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TMI Blog2008 (3) TMI 476X X X X Extracts X X X X X X X X Extracts X X X X ..... have also prayed for the direction to the Official Liquidator to restrain him from taking possession of the rooms occupied by them and situated on land bearing Survey Nos. 410/1/B bearing Final Plot No. 46 of T.P. Scheme No. 12 of Ahmedabad. All applicants have filed their separate affidavits in support of Judge's Summons. 4. Mr. R.S. Sanjanwala, learned advocate along with Mr. Dilip L. Kanojiya appears for the applicants and Mr. J.S. Yadav, learned advocate appears for the Official Liquidator in all these Company Applications. 5. It is the case of the applicants in all these Company Applications that by an order dated 7-3-1993 passed in Company Petition No. 79 of 1989, Vijay Mills Limited has been ordered to be wound up by this Court. The Company in liquidation owns land bearing Survey No. 410/1/B, bearing Final Plot No. 46 of T.P. Scheme No. 12 of Ahmedabad. On the said land, Chawl was constructed by the Company in liquidation which is known as Krishna Chawl. The said Chawl was given on rent to various persons. The Chawl is in existence for the last more than 70 years and ever since it was constructed, it was given out on rent to various persons. The persons who were given the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bsequently by way of sub-tenancy or sale and in that case the list of original tenants and the present occupiers of the premises in question be furnished. The Court has also directed to make it clear as to whether all these applicants have paid rent, mesne profit or occupation charges to the Official Liquidator or to the previous Management prior to winding up till this date. The Official Liquidator was also directed to verify his own record and if the list of the original persons occupying the premises on the date when the winding up order is passed, was available, the said list be placed on record and be furnished to Mr. R.S. Sanjanwala, learned advocate for the applicants and necessary details are directed to be placed on record on or before 14-3-2008. 8. On 14-3-2008, the Official Liquidator has filed his report along with the list called for by the Court. Mr. R.S. Sanjanwala, learned advocate appearing for the applicants has also filed written submissions and various details were furnished in respect of each of the applicants. He has also furnished statements indicating the application No., name of the tenant, name of the occupant, whether the premises is occupied by the orig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is shown that the occupant or the predecessor was lawfully inducted and that the owner has accepted the rent from such person, such person shall be entitled to a protection as tenant of the premises. He has further submitted that it is settled position that merely because Company goes into liquidation and Liquidator/Official Liquidator is appointed, the rights of the Company vis-a-vis its landlord and/or its tenants do not undergo any change. Reliance is placed on the decision in the case of Smt. Nirmala R. Bafna v. Khandesh Spinning & Weaving Mills Co. Ltd. AIR 1993 SC 1380. 11. Mr. Sanjanwala has further submitted that it is settled legal position that all tenants in Gujarat would be entitled to protection under the Bombay Rent Hotel and Lodging Houses Rates Control Act, 1947. Sub-section (1) of section 12 of the Rent Act restrains the landlord from taking recovery of possession of any premises so long as the tenant pays, or is ready and willing to pay, the amount of standard rent and permitted increases, if any, and observes and performs the other conditions of the tenancy, insofar as they are consistent with the provisions of the Act. He has, therefore, submitted that any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in rightful possession and is entitled to protection under the Rent Act. While dismissing the said Company Application, this Court relied upon the judgment in the case of Textile Labour Association v. Official Liquidator of Amruta Mills [2005] 58 SCL 452 (Guj.). Against the said judgment, in the matter of Amruta Mills, O.J. Appeal Nos. 72, 73 & 74 of 2004 have been filed. By an order passed on 6-2-2004 by the Division Bench of this Court, the appeals have been admitted whereby the interim relief originally granted by the learned Company Judge on 26-11-2004 was extended. The said appeals are pending and interim relief is in force. He has, therefore, submitted that it would be in the interest of justice to admit these applications and await the outcome of the appeals or to order that these Company Applications be heard along with the O.J. Appeals. The judgment which may be delivered in the above Appeal will have a direct bearing on the subject matter of the present applications. 14. Mr. Sanjanwala has alternatively submitted that the applicants have also offered to purchase the premises at the market value. The market value may be determined by this Court after calling for the Valu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... OLR No. 55 of 2008, the Official Liquidator has stated that this Court vide order dated 14-2-2008 passed in Company Application No. 73 of 2008 directed the Official Liquidator to proceed further in respect of the notice dated 10-10-2007 issued by him to 66 occupants of Krishna Chawl of the Company and to get the said premises vacated forthwith. The Official Liquidator was also directed to take help from the concerned Police Station for implementation of the notice issued by him. The Court further observed in its order dated 14-2-2008 that the notice to the occupants of Chawl was issued by the Official Liquidator on 10-10-2007 directing the occupants to vacate the premises within 10 days, but on expiry of the said period of notice, the Official Liquidator has not taken any action and, therefore, it appears to the Court that the Official Liquidator is not giving due weightage to the orders passed or directions issued by this Court. In this regard, the Official Liquidator has stated that after issuance of notice on 10-10-2007, he has received a letter dated 19-10-2007 from the advocate of the occupants stating therein that they are not illegal occupants but they are lawful tenants of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the quarters of the Company. The Official Liquidator has further stated in his report that on 27-2-2008, he has deputed his persons at Krishna Chawl for vacating the quarters of the Company. However, a representation was made by the occupants stating that stay has been granted in O.J. Appeal No. 17 of 2008 till 3-3-2008 against eviction and hence, no further steps were taken by him. 19. The Official Liquidator has filed further report on 13-3-2008 stating that this Court has directed the Official Liquidator vide order dated 11-3-2008 to verify its own record and if the list of the original persons occupying the premises on the date when the winding up order was passed is available, the said list be placed on record and be furnished to Mr. R.S. Sanjanwala, learned advocate appearing for the applicants. Pursuant to the said order, the Official Liquidator has submitted that total 51 occupants as per List A to the report are the original occupants of the quarters on the date of winding up order and 15 occupants as per List B have come in possession of the quarters at Chawl after the date of winding up order. 13 occupants as per List C who were in possession of the quarters as on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as an employee of the tenant i.e. the company. He was to remain in the premises so long as he was the employee of the company. That is the reason, the Company issued notice to him to vacate and handover the rented premises to the landlady as he was no more an employee of the company. 22. Mr. Yadav further relied on the decision of the Hon'ble Supreme Court in the case of Sheodhari Rai v. Suraj Prasad Singh AIR 1954 SC 758, wherein it is observed that payment of rent does not necessarily establish relationship of landlord and tenant. Such payment may only prove permissive occupation not amounting to any right or title to possession. 23. Mr. Yadav further relied on the decision of Hon'ble Supreme Court in the case of D.H. Maniar v. Waman Laxman Kudav AIR 1976 SC 2340, wherein it is held that a person continuing in possession of the premises after termination, withdrawal or revocation of the license continues to occupy it as a trespasser or as a person who has no semblance of any right to continue in occupation of the premises. 24. Based on the aforesaid judgments and provisions of law, as interpreted by the Courts, Mr. Yadav has strongly urged that all these applications deserve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consent to the alleged tenancy rights of the applicants. On the contrary, the Official Liquidator issued notices of eviction and pursuant to the directions of this Court, he tried to implement the said notices. Since there being no tenancy rights of the applicants, there is no question of undergoing any change in the rights of the Company vis-a-vis the applicants. 28. Similarly, the decision in the case of Tirath Ram Gupta (supra), is relied upon by the applicants for limited purpose to contend that the law does not require a written agreement of lease and tenancy can be brought about by an oral agreement between the parties. The case before the Hon'ble Supreme Court was eviction of sub-tenant's on surrender of lease by the tenant. An agreement of lease was not in dispute. It was observed in this context that a lease is a transfer of a right to enjoy the property. It creates an interest in the property by virtue of the contract of lease which may be either oral or written. The interest created in the property can be put an end to by terminating the contract. The contract however, cannot be terminated in part. Since agreement of lease was not in dispute and that was sought to be te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er sub-section (2) of section 12 of the Act. 30. Here in the present case, applicants are not the tenants under any agreement and they are not in possession of the premises under a lease from the Company. 31. In the case of Vora Abbasbhai Alimahomed (supra), admittedly, there is relationship of landlord and tenant between the parties and the landlord called upon the tenant to deliver possession of the premises alleging that the tenant had failed to pay rent and the tenant in reply contended that he had paid rent at the agreed rate and that he was entitled to get credit for certain amount being the costs incurred by him for 'electric installation' in the premises with the consent of the landlord and that the rent stipulated was excessive. In this context, it was observed that the clause applies to a tenant who continues to remain in occupation after the contractual tenancy is determined. It does not grant a right to evict a contractual tenant without determination of the contractual tenancy. Protection from eviction is claimable by the tenant even after determination of the contractual tenancy so long as he pays or is ready and willing to pay the amount of the standard rent and pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies to a past officer or employee of a Company, if the wrongful obtaining, withholding or application of the property was done in his capacity as such Officer or employee. Thus, when an employee refuses to vacate the premises of the Company on determination of the employment or on his retirement but continues in possession even after his retirement, the employee can be held liable under section 630 of the Act. The Court further held that section 13(1)(f) of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, provides that if premises are let to a tenant for use as resident in consequence of his being in service, it is also a ground for eviction. This clause refers to an occupation by a servant as tenant, whether by way of remuneration or a part payment for services or whether paying rent or not. If the Company decides to seek possession under section 13(1) of the 1947 Bombay Act against the employee - tenant the Company has to pursue the remedies before a competent Court as provided under section 28 of the 1947 Bombay Act. The provisions of section 630 of the Companies Act, 1956, also provide a special remedy which is summary in nature against a person who ceases to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble Supreme Court has held that the respondents having remained in possession after the death of the employee as his heirs and the Company not having authorized them to remain in possession, possession of the Company's flat by the respondents, after the service of notice to vacate the premises by the company, is wrongful withholding of the property of the company. The respondents by having wrongfully withheld the possession of the company's flat and not delivered the property to the company, had committed an offence under section 630 of the Companies Act. The Court further held that the decision of the High Court that section 630 of the Companies Act being penal in nature, proceedings thereunder could not be construed as proceedings taken in due process of law, was unsustainable. The filing of a Civil suit for possession by the Company did not deprive the Company of the right to institute prosecution under the Companies Act and incidentally get an order for delivery of possession. 37. In the case of Official Liquidator of Aryodaya Spg. & Wvg. Mills Co. Ltd. v. Charansingh Dhupsingh [2004] 56 SCL 133 (Guj.), this Court has held that once it is found that a person is a trespasser, p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is in the possession of a tenant is the property of the Company, and on the appointment of the Provisional Liquidator or the Liquidator under the authority of the Court, the Liquidator is entitled to take into his hands all the properties which belongs to or which appear to belong to the Company. Section 457(1)(c) of the Act authorizes the Liquidator in a winding up to have power with the sanction of the Court 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. The Liquidator would also be entitled to do all such other things as may be necessary for winding up the affairs of the Company and distributing its assets. Section 477(6) of the Act provides that if, on his examination, any such officer or person admits that he has in his possession any property belonging to the Company, the Court may order him to deliver to the Provisional Liquidator/Liquidator, as the case may be, that property or any part thereof, at such time, in such manner and on such terms as seem just to the Court. The endeavour of a Company Judg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nly because their claim regarding tenancy rights is under consideration of the Court. The Official Liquidator is in the process of liquidating the undisputed assets of the Company and now the disputed assets are taken on hand. So at this stage, the Court will not allow the applicants to raise such contention. Even otherwise, there is no merits or substance in this contention and hence, it is rejected. Section 468 empowers the Court to make an order at any time after making a winding up order on any contributory, Trustee, Receiver, Banker, Agent, Officer or other employee of the Company, to pay, deliver, surrender or transfer forthwith or even such time as the Court directs, to the Liquidator, any money, property or books and papers in his custody or under his control, to which the Company is prima facie entitled. 42. In view of the above factual and legal position, none of the applicants of this group deserve any relief from this Court. All these applications are, therefore, rejected. The Official Liquidator is, therefore, directed to implement the notices issued by him on 24-5-2007 and 10-10-2007. Since the State Government is a party in OLR No. 55 of 2008, the concerned Police a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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