M/S Markit India Services Pvt Ltd vs M/S Ishan Systems Pvt Ltd
2012 Latest Caselaw 4900 Del

$~5
*     IN THE HIGH COURT OF DELHI AT NEW DELHI


%                           Date of Judgment:22.08.2012

+ CO.PET. 267/2012 & CO. APPLS. No.1104-05/2012 & 1211/2012


M/S MARKIT INDIA SERVICES PVT LTD              ..... Petitioner
                   Through  Mr. P.C. Sen, Adv.

                   versus


M/S ISHAN SYSTEMS PVT LTD                                ..... Respondent
                  Through             None.

      CORAM:
      HON'BLE MS. JUSTICE INDERMEET KAUR

INDERMEET KAUR, J. (Oral)

1 M/s Market India Services (P) Ltd. (hereinafter referred as the

'petitioner company') seeks winding up of M/s Ishan Systems (P) Ltd.

(hereinafter referred to as the 'respondent company').

2 Contention of the petitioner is that an agreement dated 11.01.2011

had been entered into between the parties whereby the petitioner had

agreed to take on lease the 4th floor in Tower 'B' of the building of the

respondent; pursuant thereto he had paid a security amount of

Rs.1,39,15,605/- as also nine months' advance rent of Rs.1,07,15,760/-

and maintenance charges of Rs.31,99,845/-; the possession of the

premises had been handed over to the petitioner on 11.01.2011; there

was a rent free period of 60 days to carry out fit-outs of the petitioner.

3 Further submission is that on 19.04.2011 without any warning or

notice, physical possession of the property was taken over by a Receiver

appointed by the Debt Recovery Appellate Tribunal (DRAT) pursuant to

its order dated 11.04.2011 in proceedings under the Securitization and

Reconstruction of Financial Assets and Enforcement of Security Interest

Act, 2002 (SARFAESI Act); submission being that it was at this stage

that the petitioner became aware of the fact that the M/s Phoenix ARC

Pvt. Ltd. had been assigned the debt owed by the respondent company to

Vijaya Bank in respect of which proceedings had been initiated against

the respondent; Vijaya Bank had in turn assigned its debt to M/s

Phoenix ARC Pvt. Ltd.; this was known to the petitioner only on

19.04.2011.

4 Termination notice (dated 11.05.2011) was sent to the respondent

company by virtue of which the petitioner had sought refund of its

security deposit. Reply filed to this notice denied any liability. The

petitioner had moved an application seeking impleadment in the

proceedings pending before the DRAT and on 30.08.2011, the DRAT

had directed the petitioner to take back its fittings and fixtures and other

moveable lying in the aforenoted premises. Further submission of the

petitioner is that the liability of the respondent towards the petitioner (of

the security deposit which it has received) is an admitted liability;

inspite of legal notice dated 19.01.2012 issued under Sections 433 &

434 of the Companies Act, 1956, the payment of the petitioner has not

been liquidated. Reply filed by the respondent to the aforenoted legal

notice dated 19.01.2012 has set up a sham defence; the petition is liable

to be admitted.

5 The original documents relied upon by the petitioner had not been

filed. The photocopies of the said documents had been placed on record;

submission being that the original documents had been seized by the

Receiver appointed by the DRAT.

6 The lease deed relied upon by the petitioner is dated 11.01.2011;

this is admittedly an un-registered document. The reply (dated

09.02.2012) filed by the respondent company to this legal notice is

relevant.

7 The submission of the respondent was that this security amount of

Rs.1,39,15,605/- was forfeited on account of premature termination of

the contract which was done on 17.05.2011 i.e. within less than four

months of the date of the execution of the lease. Further submission in

the reply being that the proceedings initiated by Vijaya Bank and their

pendency before the DRAT was a fact well known to the petitioner even

at the time when the agreement dated 11.01.2011 had been entered into

between the parties as this finds a specific mention at internal page 17 of

the aforenoted lease agreement; clause 14.2 of the lease deed clearly

states that the lessor shall obtain a no-objection from Vijaya Bank with

which it has a subsisting loan; learned counsel for the petitioner also

fairly concedes that he was aware of the mortgage having been effected

by the lessor in favour of Vijaya Bank. As such it does not now lie in the

mouth of the petitioner to state that he first became aware of the debt

owed to Vijaya Bank only on 19.04.2011 i.e. when the Receiver seized

the property.

8 The lease deed dated 11.01.2011 is admittedly an un-registered

document. In view of Section 49 of the Registration Act read with

Section 107 of the Transfer of Property Act, an un-registered lease deed

can best be looked into only for a collateral purpose; what is a collateral

purpose depends upon the facts of each case.

9 The present lease deed has a lock-in period which is contained in

clause 10; admittedly this period of three years would expire on

11.01.2014. Clause 10 specifies that the lease may be terminated by the

lessee by giving a three months' notice in advance which right can be

exercised by the lessee only during a renewed lease term. On no other

count, the lessee is entitled to terminate the lease prematurely; learned

counsel for the petitioner is also not able to point out any other clause in

the lease deed which permits him to terminate the lease prior to the three

year lock-in period. Clause 10.3 specifically states that if the lease is

terminated by the lessee during the lock-in period, the lessee agrees to

pay to the lessor the rent for such portion of the remaining lock-in

period for which the lessor is unable despite its best efforts to secure an

alternate tenant/lessee for the premises at the same or higher rent. Clause

10.4 also reaffirms the liability of the lessee to pay to the lessor the rent

for the remaining lock-in period in case the lease is terminated during

the lock-in period. Clause 8 of the document provides that the security

deposit shall be refunded by the lessor to the lessee without interest at

the time of the expiry of the lease; it further provides that in the event

the security deposit is not refunded, the lessee will be entitled to remain

in possession of the premises without payment of rent.

10 Record shows that the payment of the security by the petitioner to

the respondent is an admitted fact but the terms of the document dated

11.01.2011 clearly stipulate that there is a lock-in period of three years

which would expire only on 11.01.2014; prior thereto, neither of the

parties could terminate the lease; in case of an eventuality where on

account of 'force majeure' (clause 20), the lease is terminated prior in

time to the lock-in period, the lessor would be entitled to rent for the

entire lock-in period including compensation; even otherwise, it is not

the case of the petitioner that it was on account of 'force majeure' that

the lease had been terminated.

11 The facts as detailed and elicited supra clearly show that the

respondent has raised a bonafide dispute about the return of the security

deposit. These disputes cannot be gone into in a winding up petition.

12 Alternate submission of the petitioner before this Court is that the

document dated 11.01.2011 cannot even be termed as a 'lease deed; this

was only an agreement entered into between the parties and the parties

had in fact agreed that they would enter into a formal lease at a later

point of time which is evident from Clause 12 which states that the

registration of this document will be carried out within the time frame

permitted by law; submission being that the parties were yet to enter into

a lease deed.

13 Be that as it may all these questions have become disputed

questions of fact.

14 Relevant would it be to also state that the petitioner has admitted

that even in the proceedings under the SARFAESI Act before the

DRAT, he had sought impleadment; he had filed an application therein

wherein in terms of the order of the DRAT dated 30.08.2011, it has been

noted that the prayer made by the petitioner was only for a return of his

belongings i.e. movables lying in the property for which an inventory

had been prepared and which were ordered to be returned to him. The

DRAT in this order has also noted that the tenant does not want to

continue with the premises and he voluntarily seeks to vacate the

premises. Relevant extract of this order is noted here-in-below:-

"There is no dispute between the parties that an inventory was prepared. Since the tenant does not want to continue to be a tenant therefore voluntarily the

premises is being vacated by the applicant/tenant.

Under these circumstances, a prayer is made that the movable and the fixtures belonging to the tenant be decided to be taken over by the tenant. To this extent there seems no dispute among the parties. Since the applicant/tenant is voluntarily relinquishing his right not only of tenancy but right and interest on all the fixtures and movables in the property are claimed, therefore, it is directed that the tenant shall be permitted to take away his belonging as per the inventory and the appellant as well as the responding shall cooperate. The receiver, as appointed, shall monitor the return of the belongings of the tenant as per the inventory in presence of the borrower and the representative of the bank.

This order disposes of all the applications filed by the tenant. "

15 In the reply filed by the respondent to the legal notice this part of

the order has been quoted; it has been pointed out by the respondent

company that the petitioner at no point of time had made any prayer for

the refund of the security deposit; this is also clear from the order of this

Court dated 09.08.2011 in W.P.(C) No.5693/2011 wherein also it had

been noted that the only claim made by the petitioner was for the return

of his fittings and fixtures which he has installed in the property prior to

the property being sealed.

16 The further fact that the proceedings by the Vijaya Bank against

the lessor were known to the petitioner is also evident from clause 14.2

(v) of the lease deed dated 11.01.2011. It definitely now does not lie in

the mouth of the petitioner to urge this argument that this fact was never

informed to him.

17 The lease deed also provides that the parties may resort to

arbitration.

18 There is no dispute that a petition for winding up is independent

of the remedy of arbitration and if the claim of the petitioner is admitted

and the defence sought to be raised by the respondent appears to be

illusory or moonshine, the Company Court can proceed with the

winding up petition. However this is not one such case. The disputes

raised by the respondent qua the lease agreement dated 11.01.2011 and

the defence that the security deposit stood forfeited for the reasons that

the lease was terminated in the intervening lock-in period as also the fact

that at no point of time either before the High Court or before the DRAT

the petitioner had ever raised any claim for the refund of the security

deposit, the question whether the petitioner is entitled to refund of the

security deposit (not being an admitted claim) cannot be gone into by

this Court. The disputes raised by the respondent company in its reply

(dated 19.02.2012) appear to be genuine and bonafide; they amount to

complex questions of fact which cannot be entertained by the Company

Judge in a winding up petition.

19 This petition is not maintainable. It is accordingly dismissed with

cost of Rs.25,000/-. Needless to state that if a civil remedy is available

to the petitioner, he is advised to take recourse to that.

INDERMEET KAUR, J AUGUST 22, 2012 A