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TMI Blog1983 (12) TMI 211X X X X Extracts X X X X X X X X Extracts X X X X ..... akers with a view to hand over the premises to them on caretaker basis. A part of the premises having an area of 1,334 square feet on the mezzanine floor in the building known as "New Kamani Chambers" is admittedly in the occupation of respondent No. 2, namely, Kamani Metals and Alloys Ltd. When the appellants found that the official liquidator was intending to part with the premises on caretaker basis, they took out a judge's summons for an order that the official liquidator should be directed to forthwith hand over to them quiet, vacant and peaceful possession of the premises described in Exs. E F and G to the affidavit in support of the judge's summons. One of the prayers made in the judge's summons was that the official liquidator should also pay a sum of Rs. 6,16,810.47, being the arrears of rent and/or consideration and electric charges payable by the company in liquidation to the appellants. The appellants also prayed for a direction that the official liquidator will not dispose of or part with possession or alienate or encumber the premises in question. In the affidavit filed by the official liquidator in reply to the affidavit filed on behalf of the appellants, it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d decision and the judge's summons should have been made absolute by the learned single judge. Having gone through the decision in Ravindra Sethna's case, ( supra ), it is clear that the arrangement of the kind which is contemplated by the official liquidator is not permissible because such an arrangement does not fall within the provisions of section 457 of the Companies Act under the relevant clause of which the liquidator has the power to carry on the business of the company in so far as it may be necessary for the beneficial winding-up of the company. The facts of the decision will show that the liquidator in that case had taken possession of the premises of the company and subsequently by the order of the High Court, the liquidator had entered into a caretaker's agreement with the licensee and given possession of the premises to him on compensation and on terms and conditions set out in the agreement. Admittedly, the business of the company had come to a standstill and no business of the company was carried on by the liquidator for the purposes of winding-up. On those facts, after referring to the provisions of section 457(1),clause ( b ), which enabled the liquidator in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpermissible use of the premises. And that is what the liquidator sought to do, and the court extended its help to the liquidator. This, in our opinion, is wholly impermissible. The learned company judge could not have authorised the liquidator to enter into such an agreement and, therefore, his order is liable to be set aside." The observations quoted above clearly show that the nature of the arrangement which is contemplated by the official liquidator for raising funds by making premises available for use to other persons on the basis of caretaker's agreement is unfair and impermissible. The facts in the instant case are in no way different. It is not the case of the official liquidator that the premises are necessary for him for the purposes of winding-up the business of the company. Indeed, the very fact that the premises have been offered by public advertisement on caretaker basis itself shows that the official liquidator does not need these premises. It is clear, therefore, that the landlord will be entitled to these premises if the official liquidator does not require them for the purposes of the winding-up of the business of the company. It has, however, been vehemently ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt No. 2 in the course of which, as the report shows, respondent No. 2 requested the official liquidator to maintain status quo and treat them either as sub-tenants or as licensees. The court gave a direction in the affirmative as sought by the official liquidator and the following undertaking was given on behalf of respondent No. 2 by the secretary of respondent No. 2. "We, Kamani Metals Alloys Ltd., who are occupying mezzanine floor in New Kamani Chambers on a monthly compensation of Rs. 2,001 exclusive of electricity charges do hereby undertake to hand over vacant possession of these premises on demand from you. We also undertake to pay to the official liquidator monthly compensation of Rs. 2,001 each month in advance exclusive of electricity charges for the use and occupation of the premises." Undoubtedly respondent No. 2 had in the affidavit claimed the status of a sub-tenant and it is also argued before us, as already pointed out, that he had been in occupation long before the order of winding-up. However, it is difficult for us to see how respondent No. 2 can now be permitted to urge that he was already in possession as sub-tenant because his present position is expr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sent premises, which are the subject-matter of those proceedings, will be a valuable asset of the company in case it is revived, we think that the interest of everybody concerned and interested in the well being of the company will be sufficiently safeguarded if we make the order that the official liquidator will hand over possession of the premises to the appellants in case an order for reviving the company and for taking the company out of liquidation is not passed on or before December31,1984. It is also contended by Mr. Chinoy, on behalf of the appellants, that the official liquidator has not been paid any rents and other dues due to them for the period prior and subsequent to the order of winding-up. Now, so far as dues for the period prior to the order of winding-up are concerned, it cannot be seriously disputed that the appellant company will have to rank as a creditor in line with the other creditors, if there be any. So far as the period subsequent to the order of winding-up is concerned, admittedly an attachment order by the sales tax authorities has been served on the official liquidator with the result that the official liquidator is prevented from paying any rent dir ..... X X X X Extracts X X X X X X X X Extracts X X X X
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