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TMI Blog1969 (9) TMI 65X X X X Extracts X X X X X X X X Extracts X X X X ..... he provisions of this Act, no person shall claim or receive any rent in excess of the standard rent, notwithstanding any agreement to the contrary. (2)No person shall, in consideration of the grant, renewal or continuance of a tenancy or sub-tenancy of any premises, ( a )claim or receive the payment of any sum as premium or pugree or claim or receive any consideration whatsoever, in cash or in kind, in addition to the rent; or ( b )except with the previous permission of the Controller claim or receive the payment of any sum exceeding the month's rent of such premises as rent in advance. (3)It shall not be lawful for the tenant or any other person acting or purporting to act on behalf of the tenant or a sub-tenant to claim or receive any payment in consideration of the relinquishment, transfer or assignment of his tenancy or sub-tenancy, as the case may be, of any premises " There are, however, some exceptions provided in sub-section (4) of section 5 which it is not necessary to read as they have no bearing on the point which we have to decide. Section 14 controls the eviction of tenants. Under that section one of the grounds, on which a decree for eviction can be passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ( c ) to sell the immovable and movable property and actionable claims of the company by public auction or private contract, with power to transfer the whole thereof to any person or body corporate, or to sell the same in parcels." This section groups under separate heads powers which the liquidator may exercise with or without the sanction of the court. This section was the sheet-anchor of the learned counsel for the official liquidator. According to him, since the power to sanction sale vests in the court, such a sale must be treated as a sale by the court, or by operation of law, rendering the provisions of the Rent Act restrictive of assignments inapplicable. On behalf of the official liquidator reliance was also placed on section 467 of the Companies Act. It was said that under the said provision, the court is bound to "cause the assets of the company to be collected and applied in discharge of its liabilities" and this provision lent further support to the proposition that a sale made through the court is in discharge of law. In the matter of the West Hopetown Tea Company Ltd. [1890] ILR 12 All. 192, 197, the liquidator applied under section 144 of the Companies Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iting of the landlords. The penalty imposed by section 48, clause (2), pertains to such a violation by the tenant of the said provision, namely, the tenant himself making the transfer without the consent in writing of the landlord. There is no warrant whatever for extending the prohibition against transfers by the tenant to a situation as in the present case, where there was an involuntary transfer of the tenancy rights by a court-auction." In Krishna Das Nandy's case ( supra ) Great Indian Motor Works Ltd. held the suit premises as monthly tenant. The said company was ordered to be wound up and the court directed sale of the property and assets of the company including tenancy rights. The question arose whether it was a transfer by the tenant thereby depriving the tenant of the protection of section 12 against eviction. It was held : "In a compulsory winding up, the company is put into liquidation against its will by force of law and the order of the court and the sale is made by the liquidator, acting under the control of the court and with its sanction. That is the dictate of law. The sale, therefore, is really by the court, acting through the liquidator and the company ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , and the lease contained a covenant on the part of the bank, its successors and assigns, that they would not "assign the said demised premises or any part thereof without the previous consent in writing of the lessor first obtained.". The company was ordered to be wound up and the liquidator proceeded to make necessary arrangements for the sale of the lease. He took out a summons in the winding up for a declaration, inter alia, notwithstanding the covenant restrictive of assignment by the company, the liquidator was entitled to assign the premises without the consent of the landlord. P.O. Lawrence J. held that the liquidator in selling the property was acting in invitum for the benefit of creditors, that a voluntary assignment and not an assignment in invitum was contemplated by the restrictive covenant in question, and that the liquidator was at liberty to sell and assign the term granted by the lease. The Court of Appeal, however, held that the covenant in the lease was binding on the liquidator in winding up. Lord Sterndale observed : "But here, as I say, the act would be the act of the company acting through its liquidator who is carrying on its business for the purpos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of. the court. That however is only the manner prescribed for the exercise of that power. But it does not have the effect of making it as the act of the court or a sale by operation of law. In my opinion, whether the power is to be exercised with or without the sanction of the court makes no difference for the purpose of deciding whether or not the sale is by the company. In that situation, the interdict against receiving money in consideration of the assignment of tenancy rights placed by section 5 will operate fully even when the liquidator assigns it with the sanction of the court. There is no provision in the Companies Act that the liquidator shall sell properties of the company free of all restrictive covenants or legal disability and if law places a restriction on assignment by every tenant including a company I see no reason why it should not apply to assignment when the company has to act through its liquidator. It was strenuously argued on behalf of the liquidator that sub-section (3) of section 16 of the Rent Act applies only to a voluntary act of the tenant and not to a sale by the liquidator which the learned counsel for the liquidator described as a forced sale. I r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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