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TMI Blog2016 (3) TMI 1029X X X X Extracts X X X X X X X X Extracts X X X X ..... fore this Court by both sides that presently revival of Prasad Mills is a live issue pending before the Gujarat High Court, a fact which cannot be ignored by this Court in deciding the above issue against the appellants. - Civil Appeal Nos. 3147-3149 of 2016 (Arising out of S.L.P.(C) Nos. 29282-29284 of 2008) - - - Dated:- 29-3-2016 - Ranjan Gogoi And Prafulla C. Pant, JJ. Civil Appeal No. 3153 of 2016 (Arising out of SLP(C) No. 29952 of 2008) Civil Appeal No. 3157 of 2016 (Arising out of SLP(C) No. 29632 of 2008) Civil Appeal No.3158 of 2016 (Arising out of SLP(C) No. 940 of 2009) Civil Appeal No. 3159 of 2016 (Arising out of SLP(C) No. 1866 of 2009) Civil Appeal No. 3160 of 2016 (Arising out of SLP(C) No. 2583 of 2009) Civil Appeal No. 3161 of 2016 (Arising out of SLP(C) No. 5880 of 2009) Civil Appeal No.3162_ of 2016 (Arising out of SLP(C) No. 7864 of 2009) Civil Appeal No. 3163 of 2016 (Arising out of SLP(C) No. 12835 of 2009) Civil Appeal No. 3164 of 2016 (Arising out of SLP(C) No. 12919 of 2009) Civil Appeal No. 3165 of 2016 (Arising out of SLP(C) No. 14276 of 2009) Civil Appeal No. 3166 of 2016 (Arising out of SLP(C) No. 14316 of 2009) Civil Appeal No. 3167 of 2016 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as urged that the official liquidator was not authorised to transfer/alienate the leased property in view of the provisions of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947, as it then existed (hereinafter referred to as the Bombay Rent Act ). While the above Company Application was pending the building, superstructure, plant and machinery of the company was sold in a public auction. It appears that on 6.2.2004 an advertisement was issued by the official liquidator for the sale of the leased property. As against the aforesaid advertisement, the appellant had filed Company Application No.33 of 2004 for a declaration that the official liquidator had no right to sell the leased property. The grounds urged were principally on the basis of lack of any such empowerment in the lease agreement and in view of the bar/restriction contained in Section 15 of the Bombay Rent Act. Another Company Application i.e. C.A. No.34 of 2004 was filed seeking permission from the Company Court to file a suit before the appropriate court for eviction of the official liquidator from the leased property. Eviction of the official liquidator was claimed, inter alia, on the ground that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the purpose for which it was let, the landlord shall not be entitled to;-- (a) the standard rent and permitted increases due for the premises, (b) recover possession of such premises merely oh the ground of non payment of standard rent and permitted increases due, during the period in which such premises remain so destroyed or unfit.] (2) No suit for recovery of possession shall be instituted by a landlord against a tenant on the ground of non payment of the standard rent or permitted increases due, until the expiration, of one month next after notice in writing of the demand of the standard rent or permitted, increases has been served upon the tenant in the manner provided in section 106 of the Transfer of Property Act, 1882 (IV of 1882). (3) (a) Where the rent is payable by the month, and there is no dispute regarding the amount of standard rent or permitted increases, if such rent or increases are in arrears for a period of six month's or more and the tenant neglects to make payment thereof until the expiration of the period of one month, after notice referred to in sub-section (2), the Court may pass a decree for eviction in any such suit for recov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it in any area the transfer of interest in premises held under such leases or class of leases and to such extent as may be specified in the notification.] [(2) The bar against sub-letting, assigning or transferring premises contained in sub-section (1) shall be deemed not to have had any effect before the commencement of the Bombay Rents, Hotel and Lodging House Rates Control (Amendment) Ordinance, 1959 (Bom. Ord. No. III of 1959), in any area in which this Act was in operation before such commencement; and accordingly, notwithstanding anything contained in any contract or in the judgement, decree or order of a Court any such sub-lease, assignment or transfer in favour of such persons as have entered into possession despite the bar as sub-lessees, assignees or transferees, and have continued in possession at the commencement of the said Ordinance, shall be deemed to be valid and effectual]. 19. - Unlawful charges by tenant (1) [Save in cases provided for under the proviso to section 15,] it shall not be lawful for the tenant or any person acting or purporting to act on behalf of the tenant to claim or receive any sum, or any consideration as a condition of the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Second Party from the rent payable, or the Second Party will give such reduced rent to First Party after adjusting the said amount, in the following years; and the First Party will have no right to any objection or dispute, and even if they raise any dispute it will be not sustainable by virtue of this agreement. (5) In case the Second Party, or their successors, attorneys. administrators, assinee or executors do not stay, or do not make use of, or do not store material, on the land; or vacate the land and give possession to the First Party, before the specified period, then the First Party is entitled to receive rent till the date of possession so given; and the First Party has no right to claim rent for the remaining period. (6) The municipal tax for the land is ₹ 500-00 per year. which will be paid by the Second Party; and the Second Party will give rent of ₹ 3501/- to First Party every year. However, the Second Party do not pay the municipal tax of ₹ 500/- and the same has to be paid by the First Party, then the Second Party, or their successors will reimburse such amount with six percent interest per hundred per year thereon. (7) The F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of fixed-term contractual lease was not involved in the case of Dhanapal Chettiar (Para 14). In fact in paragraph 15 of the judgment in Laxmidas Bapudas Darbar (supra) it was held : It has nowhere been held that by virtue of the provisions of the Rent Act the contract of term lease is completely obliterated in all respects. The effect of the Rent Act on tenancy under contract has been considered only to a limited extent, confining it to the necessity of giving notice under Section 106 of the Transfer of Property Act. In Laxmidas Bapudas Darbar (supra) another decision of this Court in Shri Lakshmi Venkateshwara Enterprises (P) Ltd. vs. Syeda Vajhiunnissa Begum (Smt.) Ors. 1994 (2) SCC 671 rendered in the context of Section 21 of the Karnataka Rent Act and, specifically, the provisions of the aforesaid Section of the Karnataka Act were considered. The non-obstante clause in Section 21 of the Karnataka Act which gives an overriding effect over any provision in any other law was specifically taken note of and eventually it was held that the effect of the non-obstante clause contained in Section 21 of the Karnataka Act on a fixed-term contractual lease would be as follows ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matter of the lease granted to him by the original lessor. 12. So far as the contention of the appellants that as the company has been wound up it no longer required the leased land for its use is concerned, the High Court, in the impugned judgment, disagreed with the aforesaid proposition as a viable and acceptable proposition of law. Furthermore, it was held that the liability/obligation to pay rent for the leased land does not constitute an onerous obligation on the company in liquidation so as to justify surrender of the leased land by the Official Liquidator or any direction to the said effect under Section 525 of the Companies Act. 13. So far as the issue with regard to default in the payment of rent is concerned, the High Court, in the light of its views with regard to the applicability of the provisions of the Transfer of Property Act, had invoked both Section 114 of the Transfer of Property Act and Section 12 (3) of the Rent Act to hold that as the secured creditors and workers have always shown their readiness and willingness to pay the rent and arrears thereof the lessors are not entitled to claim or get possession of the land leased to the company presently in w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the State Bank of India had all along been ready and willing to pay all rents due. In fact, the learned Additional Solicitor General has drawn the attention to the directions of the High Court contained in para 43 of the impugned judgment (extracted above) to contend that the same is an order passed under Section 12(3)(b) of the Rent Act which, however, could not be honoured in view of the interim order passed by this Court at the time of entertaining the special leave petitions. Insofar as the arguments advanced on behalf of the appellants with regard to Section 13(1)(e) is concerned, it is urged by the learned Additional Solicitor General that under Clause 7 of the lease deed dated 10.12.1916 subletting is admittedly permissible. In the present case, according to the learned Additional Solicitor General, there is no assignment. In this regard reliance is placed on two decisions of the Privy Council in Hans Raj vs. Bejoy Lal Sel [AIR 1930 PC 59] and Ram Kinkar Banerjee vs. Satya Charan Srimani [AIR 1939 PC 14] to contend that the law, as prevailing in India, does not recognize any substantial difference between subletting and assignment. So far as Section 13(1)(k) is concerned, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order does not mention any specific rent which has to be tendered in Court but what is encompassed therein is a direction to the official liquidator to let the State Bank of India know the precise amount that is required to be paid on account of rent and, thereafter, to pay the same to the official liquidator whereafter it has been left open for the lessors to withdraw the said amount from the official liquidator. Such an order by no stretch of reasoning would be one contemplated under Section 12(3)(b). In the aforesaid situation, the finding of the High Court that the landlord is not entitled to seek eviction on the ground of non payment of rent under Section 12 of the Bombay Rent Act cannot be said to be so inherently infirm so as to require the interference of this Court. 18. This will bring the Court to a consideration of the liability of the official liquidator to a decree of eviction on the ground contemplated under Section 13(1)(e) of the Bombay Rent Act. As already discussed in a preceding paragraph of the present order, the non obstante clause of Section 13 (1) overrides only the other provisions of the Bombay Rent Act and is also subject to the provisions of Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as already noticed, insofar as the contemplated sale/transfer/assignment of the leased property by the official liquidator is concerned. The arguments advanced on the strength of the provisions of Section 19 of the Bombay Rent Act would also stand answered on the above basis. 19. Insofar as liability under Section 13(1)(k) of the Bombay Rent Act is concerned what is to be noticed is the requirement of unjustified non-user for a period exceeding 6 months which evidently is not be attracted to the present case in view of the pendency of the liquidation proceedings. That apart, Clause 5 of the lease deed which deals with non-user of the leased land does not contemplate eviction on account of such non-user but merely entitles the lessor to receive rent for the period of such non-user of the land. 20. The mere fact that the company has been ordered to be wound up cannot be a ground to direct the official liquidator to handover possession of the land to the owners inasmuch as the company in liquidation continues to maintain its corporate existence until it stands dissolved upon completion of the liquidation proceedings in the manner contemplated by the Companies Act. In the present ..... X X X X Extracts X X X X X X X X Extracts X X X X
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