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Ram Kumar and anr. Vs. Punjab Exchange Ltd. - Court Judgment

LegalCrystal Citation
SubjectCompany
CourtDelhi High Court
Decided On
Case NumberCivil Appeal No. 15 of 1983
Judge
Reported in25(1984)DLT173
AppellantRam Kumar and anr.
RespondentPunjab Exchange Ltd.
Advocates: Satish Chander and; Daljit Singh, Advs
Excerpt:
company - assets of company - companies act, 1956 - property leased to company - company went in liquidation during pendency of appeal against eviction - leased property did not form part of asset - liquidator directed to handover possession to landlord - eviction of sub-tenancy created by company to be decided in civil proceedings. - - 1, the company would have satisfied the requirement of the order passed in r......paid to the respondent no. 1. it is in these circumstances that the respondent no. 1 moved the company judge requesting that the possession of the whole of the building be given to it. the plea being that the company having been wound up the premises should be restored because even if r.f.a. 90/1979 was to be allowed and the company was to be held to be a tenant the premises in dispute, it will not now avail it, because tenancy not being assets could not be sold and the only alternative would be to restore back the possession from whom it was taken namely respondent no. 1. of course this plea is not accepted by the official liquidator, nor by some of the contributories who have filed the present appeal. the company judge has held that unnecessary expense was being incurred by the.....
Judgment:

Rajindar Sachar, J.

(1) ADMITTED. We have heard the counsel for the parties. This is an appeal against the order of 29-8-1983 and 8-9-1983 by which review was sought of the earlier order. By the order of 29-8-1983 the Official Liquidator was directed to hand over vacant possession of certain part of the premises in occupation of the company respondent No. 2 (which is in liquidation) to respondent No. 1. With regard to the portion which are occupied by other persons liberty was given to the respondent No. 1 to take proceedings against them under law but making it very clear that there was no question of handing over the physical vacant possession of these parts to the respondent No. 1.

(2) An order of winding up of the company was passed on 23-4-1981. Appeal against that order was dismissed on 9th November, 1981 and S. L. P. filed against order was dismissed in May, 1982. The company was said to be carrying on the business of forward trading in Jaggery, which because of the ban by the Government of India could no longer be carried on. Winding up had been ordered because the company was unable to pay its debts and also as the sub-stratum of the company had vanished that it was just and equitable to wind up the company. After the company was ordered to be wound up naturally the Official Liquidator stepped ill.

(3) It appears that the premises in dispute, Kohinoor Building was in the possession of the company ; according to it on tenancy, but according to the respondent No. 1 only on license to the company.

(4) It appears that Punjab Exchange Limited had filed a suit for possession against the company before an order for winding up had been passed. That suit succeeded in the trial court where it was held that the Company had been given the premises on license. The Company thereafter filed an appeal being R.F.A. 90/1979 in this Court. Only four years have passed and naturally it is too early for a first appeal to have been heard and disposed of. In the appeal the appellate court gave stay of dispossession of the company subject to a payment of Rs. 2,000.00 per month by the company to the respondent No. 1. This order is being complied with by the Official Liquidator (after the order of winding up), who is also in physical occupation of a part of the premises, the rest being with other persons. It is common case that the Official Liquidator, as stated by his counsel, is recovering about Rs. 3.000.00 from these other occupants of various portions of the building. Out of that Rs. 2,000.00 is being paid to the respondent No. 1. It is in these circumstances that the respondent No. 1 moved the Company Judge requesting that the possession of the whole of the building be given to it. The plea being that the Company having been wound up the premises should be restored because even if R.F.A. 90/1979 was to be allowed and the company was to be held to be a tenant the premises in dispute, it will not now avail it, because tenancy not being assets could not be sold and the only alternative would be to restore back the possession from whom it was taken namely respondent No. 1. Of course this plea is not accepted by the Official Liquidator, nor by some of the contributories who have filed the present appeal. The Company Judge has held that unnecessary expense was being incurred by the Official Liquidator and since there was no business which was being carried on by the Company he saw no reason why the Official Liquidator should retain the vacant possession with himself. He, thereforee, directed that the possession of the portion with the Official Liquidator be restored to the respondent No. 1. Qua the portion occupied by the other occupants the learned Single Judge has directed and this was also so conceded by the respondent No. I that there was no question of his getting vacant possession through the instrumentality of the Company Court, though the permission was given to the respondent No. 1 to take recourse to such measures as may otherwise be independently available under the law. Against the above order the appeal has been filed by two persons who claim to be contributories of the company. Objection is taken by the counsel for the respondent No. 1, Mr. Daijit Singh to the competency of these persons to file an appeal. According to him the appeal could not have been filed by these persons because they are total strangers. We need not go into this aspect of maintainability of the appeal because we are upholding the Single Judge's order except for small variation. But we wish to clarify that this variation should not be taken to be a rejection of the plea put forth by the respondent No. 1 that the present appeal is not competent. We are, however, proceeding on the assumption that the appeal is competent and hence dealing with on the merits.

(5) So far as the learned Judge's order concerning the vacant possession of the portion which is with the Official Liquidator being handed over to the respondent is concerned the objection raised by the appellant's counsel is that in R. F. A. 90/1979 stay of dispossession has been ordered and thereforee the present order by the Company Judge could not have been passed. The first thing to notice is that at the time when this stay order was passed the company had not been ordered to be wound up. Evidently as the stay of dispossession was sought an order that the company should not be dispossessed during the pendency of the appeal was the only proper order. The problem has arisen now because the company has been wound up and the Official Liquidator is not carrying on any business. The logic of Single Judge's order is that for occupation of portion of the premises Official Liquidator is unnecessarily incurring expenses, which necessarily will also deplete whatever little assets there may be of the company. Considering that no work is being carried on by the Company and considering that winding up order has been upheld by the Supreme Court we feel that the learned Company Judge was correct in directing that the possession of the portion which is now with the Official Liquidator be given to the respondent. The result will be that as the vacant possession though of a portion is being given back by the Official Liquidator to the respondent the liability of the company to pay Rs. 2,000.00 will immediately cease. This Rs. 2,000.00 p.m. is the amount which was the agreed amount on which the company had been given possession, whether as a licensee or as a tenant by the respondent No. 1. We also clarify that by giving the possession of portion to the respondent No. 1, the company would have satisfied the requirement of the order passed in R. F. A. 90/1979 to pay Rs. 2,000.00 p.m. to the respondent No. 1. We, thereforee, direct that as soon as portion of the premises with the Official Liquidator is given to the respondent No. 1, Company's liability to pay any amount to respondent No. 1 would cease, not-withstanding that other portions of the premises are with other persons and the respondent No. 1 is not being given physical possession of those portions. The company will thus be a gainer by this arrangement, subject to the variation directed by us the Single Judge's order is upheld.

(6) As far as the rights of the other occupants is concerned Mr. Satish Chandra says that in the appeal (R. F. A. 90/1979) the plea of the company is that it was a tenant and had a legal right to further induct other occupants legally. This of course is disputed by Mr. Daijit Singh, counsel for the respondent. But neither the learned Single Judge nor our order determines the controversy, which will have to be decided in the pending first appeal or in any other appropriate proceedings. Respondent No. 1. is only being permitted to take any steps against them as he is advised in accordance with law. To that there can hardly be any objection. We, however, make it clear that till stay order given in R. F. A. 90/1979 is not modified then not withstanding any proceedings that may now be taken by the respondent no. 1 in pursuance of our order, physical possession of the other occupants of those portions will not be disturbed. They will not be liable to be evicted from their present occupation as long as the stay order in R. F. A. 90/1979 continues to operate, and thereafter also only if a proper court determines their rights and orders ejectment. Our present order is not in any manner taken to be a permission to eject or dispossess the other occupants. If subject to that the respondent wishes to take any other steps he naturally does it at his own risk but without any prejudice to the rights of the other occupants. We also wish to make it clear that though the Official Liquidator was earlier receiving the payment from other occupants the same may now be realised by the respondent no. 1. We are so directing because Mr. Daijit Singh says that the Official Liquidator was incurring expenses for collection and other commission etc. which is an unnecessary burden on the company. He has offered that if permission is given to respondent no. 1 to collect, he will deposit every month in court Rs. l,000.00 on account and without charge or claim any expenses for this labour. He also accepts the responsibility of respondent no. I to deposit an amount of Rs. 1.000.00 on account with the Company Court irrespective of the fact whether he is able to realise this amount or not. The amount so deposited will be disbursed only for purposes as directed by the Company Judge. Of course, this permission that we are giving that he may recover the amount from other occupants does not in any way indicate or accept the claim that the respondent no. 1 has a right in law to recover it because this is what is being this disputed by the appellant and others. Those matters of the rights of the parties will necessarily have to be determined in appropriate proceedings. Our permission is only an ad hoc one and to meet the practical necessity of reducing the unnecessary expenses being borne by the official liquidator on behalf of the company.

(7) Mr. Satish Chandra wanted to say that the appellants being a contributory is entitled to revive the company because he is prepared to pay the outstanding debts. Mr. Daijit Singh says that this plea is dishonest and outworn one because the appellate court and the Supreme Court had refused to countenance it when dismissing appeals against the winding up order and this plea of revival is raised only for extraneous and collateral reasons. We think this plea of the appellants is misconceived in these proceedings and must be rejected. With these observations the appeal stands disposed of as above. No costs.

(8) The above order was dictated by us in Court. Before the order could be signed, we had an occasion to see the observations given in Civil Appeal No. 2609/1983 Ravindra Ishwardas Sethna & another v. Official Liquidator, High Court, Bombay & another), decided by the Supreme Court on August 19, 1983. We are reassured to find that the observations made therein have applicability to the facts of the present appeal and supports our view of the matter as mentioned above.


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