Gujarat High Court

M/S Shri Jagdish Oil Mills Ltd vs Official Liquidator Of M/S ... on 19 August, 2023

Bench: Biren Vaishnav

                                                                                   NEUTRAL CITATION




    C/OJA/10/2019                               CAV JUDGMENT DATED: 19/08/2023

                                                                                    undefined




            IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
                       R/O.J.APPEAL NO. 10 of 2019
               In R/COMPANY APPLICATION NO. 399 of 2011
                                  With
         CIVIL APPLICATION (FOR INTERIM RELIEF) NO. 1 of 2019
                      In R/O.J.APPEAL NO. 10 of 2019

FOR APPROVAL AND SIGNATURE:


HONOURABLE MR. JUSTICE BIREN VAISHNAV

and
HONOURABLE MR. JUSTICE DEVAN M. DESAI

==========================================================

1 Whether Reporters of Local Papers may be allowed to see the judgment ?

2 To be referred to the Reporter or not ?

3 Whether their Lordships wish to see the fair copy of the judgment ?

4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ?

========================================================== M/S SHRI JAGDISH OIL MILLS LTD Versus OFFICIAL LIQUIDATOR OF M/S MAHARANA MILLS CO LTD (IN LIQN.) ========================================================== Appearance:

for the Opponent(s) No. 3,4,6

MS MIRELLA M CARDOZO(3281) for the Opponent(s) No. 7

========================================================== CORAM:HONOURABLE MR. JUSTICE BIREN VAISHNAV and HONOURABLE MR. JUSTICE DEVAN M. DESAI

Date : 19/08/2023

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

CAV JUDGMENT (PER : HONOURABLE MR. JUSTICE BIREN VAISHNAV)

1 This appeal is filed by the original respondent No.1

challenging the final judgement and order dated

24.12.2018 passed by the learned Single Judge in

Company Application No. 399 of 2011. By the judgement

under challenge, the learned Single Judge allowed the

Company Application and directed the appellant to vacate

the land bearing City Survey No. 5105 admeasuring

20529.0353 sq.mtrs i.e. 24551 sq.yards situated at

Porbandar.

2 Facts in brief are as under:

2.1 The company, namely, M/s. Maharana Mills Co.Ltd.,

was ordered to be wound up by an order dated

22.12.1989 passed by this Court in Company Petition No.

138 of 1989. Several proceedings by company

applications were part of the litigation and the Official

Liquidator on 20.04.2005 informed the appellant that the

land in question had been leased to it for a period of 25

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

years by the company in liquidation. OLR No. 70 of 2005

was filed, wherein, apart from other prayers, it was

prayed for to direct the appellant to hand over vacant and

peaceful possession of the land to the Official Liquidator

in view of the fact that the lease deed already expired

way back in the year 1982. The appellant had in such

proceedings claimed rights as a statutory tenant. The

Official Liquidator Report was disposed of by an order

dated 07.08.2009.

2.2 An application was filed against the appellant for a

direction to vacate the land on the ground that the period

of 25 years of lease from the year 1957 had expired in

1982 but the possession was still with the lessee -

appellant. An intimation was sent to the appellant on

10.05.2005.

2.3 The appellant company by an order of 17.05.2005

refused to hand over possession on the ground that even

after the expiry of the lease period, it had become a

statutory tenant as it was ready and willing to pay arrears

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

of monthly rent. Alternatively, it was contended that by

virtue of adverse possession, except for the first time in

the year 2005, no claim for taking back possession was

made, the claim, therefore, was barred by time.

2.4 The learned Single Judge, after recording the

contentions of the Official Liquidator and that of the

appellant and the workers, opined that the contentions of

the appellant were misconceived. Interpreting the lease

deed, the learned Single Judge in light of the order

passed by this Court in O.L.R No. 139 of 2010, dated

10.08.2011, observed that the occupation of the land was

unauthorized. To the contention raised by the appellant

with regard to it being a statutory tenant and also that

the claim was barred by limitation, the learned Single

Judge, reading the conditions in the lease deed, namely,

Condition Nos. 8 and 10, observed that the appellant had

specifically agreed that on expiry of the lease deed, the

possession of the land would be handed over to the

liquidator / company in liquidation. The right of the

official liquidator, therefore, could not have been

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

extinguished.

2.5 Invoking the provisions of Sec.108(q) of The

Transfer of Properties Act, 1882, the learned Single Judge

observed that in accordance with the principle of

Sec.111(A) of The Transfer of Properties Act, the only

option left with the appellant was to surrender the

possession. The plea of the appellant that he became a

statutory tenant by virtue of the provisions of Sec.5(11)

(b) of the Rent Act, was also negated.

3 Mr.Ayaan Patel, learned counsel appearing for the

appellant, made the following submissions:

3.1 Mr.Patel, learned counsel, would submit that the

rent note between the parties was executed for a period

of 25 years in the year 1957 which expired in 1982. The

company was wound up by an order dated 22.12.1989.

Even after the company was so wound up, the claim for

eviction was for the first time made by the company

applicant only on 10.05.2005.

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

3.2 Mr.Ayaan Patel, learned counsel, would invite the

Court's attention to the letter of the Official Liquidator

dated 10.05.2005. Reading the letter, he would submit

that the stand of the Official Liquidator was that the

appellant was in illegal possession, and therefore, being

in unauthorized possession of land in question, the

appellant was called upon to hand over possession.

3.3 Relying on an order passed by this Court dated

07.08.2009 in OLR No. 70 of 2005, Mr.Patel, learned

counsel, would contend that the Court at that point of

time, while considering the question of as to whether the

owner can seek eviction of the appellant or whether the

appellant can maintain possession as a statutory tenant

upon compliance of the terms and conditions, left it open

to be decided at an appropriate time.

3.4 Mr.Patel, learned counsel, would invite the Court's

attention to a letter of the State Bank of Saurashtra,

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

wherein, it was pointed out that the appellant was in

possession and the bank needed to know since how long

the appellant was in possession. The appellant had at that

point of time, pointed out to the bank that lease had

expired on 17.12.1982. He would also invite the Court's

attention to the letter written by the company in

liquidation to the appellant, wherein, it was admitted that

the land was still in possession of the appellant.

3.5 Mr.Ayaan Patel, learned counsel, would submit that

even after the expiry of the rent note, the possession was

with the appellant and reading Article 67 of the

Limitation Act, Mr.Patel, would submit that the period of

12 years considering a period of two years under the

liquidation proceedings, the limitation would expire on

09.12.1996, whereas, for the first time, a claim of

possession was made by letters dated 20.04.2005 and

10.05.2005, which was beyond the period of limitation

and therefore, the claim was hopelessly time barred.

3.6 Mr.Patel, learned counsel, would invite the Court's

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

attention to the prayers made in OLR No. 70 of 2005 and

submit that once the claim was given up, no fresh cause

of action for eviction was maintainable. Mr.Patel, learned

counsel, would submit that merely because the company

goes into liquidation, the law of landlord and tenant

would not change. Once a written note was executed for a

period of 25 years, which expired in the year 1982, and

that the company-appellant herein was willing to pay the

rent in accordance with the provisions of Sec.5(11)(b) of

the Rent Act, the appellant would be protected by virtue

of it being a statutory tenant. Mr.Patel, would further

submit that the section envisages that if any person, who

remains in possession after the determination of the lease

with, or without the assent of the landlord, would

continue to be a "tenant". Relying on Sec.12 of the

Bombay Rent Act, Mr.Patel, learned counsel, would

submit that no ejectment by a landlord can be done nor

such a landlord is entitled to recovery of possession so

long as the tenant pays or is ready and willing to pay the

amount of standard rent and permit increases, which as is

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

evident from the intention of the appellant was always so.

3.7 Mr. Patel, learned counsel, would submit that the

appellant had also acquired rights by way of prescription

and adverse possession since it has been in open,

uninterrupted and continuous adverse possession of the

property and that determination of the contractual lease

of 19.12.1992 would indicate that the appellant was in

adverse possession for more than 12 years. Even

therefore, the application was barred under Article 65 of

the Limitation Act. In support of his submissions,

Mr.Patel, learned counsel, would rely on the following

decisions:

(I) Nirmala R. Bafna & Ors vs. Khandesh

Spinning & Weaving Mills Co. Ltd & Anrs.,

reported in 1992 (2) SCC 322. He would rely on

para 18 of the decision in support of his submission

that merely because a company goes into liquidation

and a liquidator is appointed, the rights of the

company vis-a-vis its landlord and / or its tenants do

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

not undergo any change.

(ii) Jabal C. Lashkari & Ors., vs. Official

Liquidator & Ors., reported in 2016 (12) SCC 44.

This judgement is relied upon by the learned

advocate in support of his submission that the tenant

gets protection of Sec.12 of the Rent Act if he is

regularly paying rent and even if the tenant has

continued to be in possession for a fairly long time

without actual payment, it will not deprive the

tenant of protection under the Rent Act. Para 18 of

the decision was pressed into service.

(iii) Mr.Patel, learned counsel, relied on a decision

in the case of Pennar Paterson Limited vs. L.P.

Polymers Ltd & Ors., reported in (2005) 128

Company Cases 852 of the Andhra Pradesh High

Court. Para 10 of the judgement was relied upon by

the learned advocate to submit that in accordance

with Sec.458(A) of the Companies Act, if benefit of

exclusion of certain time in computing period of

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

limitation is given, then also the claim of the

company in liquidation for possession is time barred.

(iv) A decision in the case of Tribhuvan Shankar

vs. Amrutlal reported in 2014 (2) SCC 788 was

relied upon. Mr.Patel, learned counsel, would rely

upon this decision to explain the concept of adverse

possession. Mr.Patel, learned counsel, would submit

that the concept of adverse possession

fundamentally contemplates a hostile possession by

which there is a denial of title to the true owner.

4 Ms.Parinda Davawala, learned counsel for the

Official Liquidator, would make the following

submissions:

4.1 Extensively reading the order of the learned Single

Judge, Ms.Davawala, learned counsel, would submit that

each and every contention raised by the appellant herein

has been answered. She would read extensively the CAV

Judgement, the relevant paragraphs thereof and submit

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

that the learned Single Judge, after having discussed the

position of facts and law and referring to the relevant

clause of the lease deed, rightly came to the conclusion

that the appellant was not entitled to any reliefs.

4.2 Ms.Davawala, learned Counsel, would submit that

the contention of the appellant that the company is an

active one is also misconceived, inasmuch as, the

electricity connections have been discontinued with effect

from 01.05.1996. She would further submit that merely

because an amount of Rs.5 lakhs was deposited in the

interregnum would not tantamount to the appellant's

intention to show readiness and willingness to pay rent so

as to earn the protection of a statutory tenant under the

provisions of the Rent Act. She would further submit that

merely because House Tax etc., were paid by the

appellant, would not work in favour of the appellant.

5 Mr. Siraj Gori, learned counsel for the respondent

No.2, made the following submissions:

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

5.1 Mr.Gori, learned counsel, would submit that the

contention of the appellant that he would get protection

of statutory tenancy is misconceived. The clause in the

lease deed itself indicated that there was no provision in

the registered sale deed for renewal of lease on the

expiry of the period of the sale deed.

5.2 Mr.Gori, learned counsel, would further submit that

at no point of time, the plea of adverse possession was

raised. Even while dealing with OLR No. 139 of 2010, this

Court on 10.08.2011, had declared that the appellant is in

unauthorized occupation of the land in question, which

was not challenged. The said order had attained finality.

5.3 Mr.Gori, learned counsel would further submit that

the company in liquidation had, by way of a letter dated

13.11.1986, asked the appellant to hand over the

possession of the property specifically mentioning that his

possession was neither statutory nor legal had it asked

the appellant to vacate the land in question.

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

5.4 Mr.Gori, learned counsel, would further submit that

the appellant had no business operations going on for

more than 25 years and it is also a matter of record that

the electricity connection of the said entity has been

disconnected. He would, therefore, submit that

appropriate orders deserve to be passed asking the

appellant to hand over vacant possession so that the same

can be put to sale by official liquidator and in turn the

poor workers represented by the respondent - Union may

get their dues. He would further submit that as per the

report of the Chartered Accountant submitted on

01.08.2005, as many as 2908 workers were employed and

the outstanding dues of those workers worked out to an

amount of Rs.37,59,75,624/- and Rs.44,10,44,272/- with

interest.

5.5 Mr.Gori, learned counsel, would rely on the

following decisions:

(I) Larsen & Turbo Ltd. Club House Road,

Madrar Vs. Trustees of Dharmamurthy Rao

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

Bahadur Calavala Cunnan, Chetty's Charities by

Its Trustees., reported in 1988 (4) SCC 260.

(ii) C.Altert Morris Vs. K.Chandrasekaran,

reported in 2006 (1) SCC 228.

(iii) Leelabai Gajanan Pansare Vs. Oriental

Insurance Company Limited., reported in 2008

(9) SCC 720.

(iv) Ravindra Ishwardas Sethna Vs. Official

Liquidator, High Court, Bombay., reported in

1984 (Suppl) SCC 605.

(v) Ramkumar Sukhchandan Gupta Vs. O.L Of

The Navjivan Mills Company., reported in 2008

(3) GLR 2291.

6 Having considered the submissions made by the

learned counsels for the respective parties and having

extensively examined the order of the learned Single

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

Judge in context of the submissions and the documents on

record, we answer the submissions accordingly:

6.1 The case of the appellant before the learned Single

Judge that since the lease period was over in the year

1982, specifically on 19.12.1982, the lease, therefore,

stood terminated by efflux of time and the appellant,

therefore, having continued in possession of the land, the

claim of the liquidator was time barred is misconceived.

6.2 For the very first time, the liquidator had by a letter

dated 13.11.1986, asked the appellant company to hand

over possession of the property. A similar request was

also made on 10.09.1987.

6.3 The lease deed is on record. Clause 7 of the lease

deed when read together with Clause 8 and 10 thereof,

clearly provide that on expiry of the term of 25 years, any

structure raised by the lessee on the land in question,

including machineries and construction will have to be

removed and the possession be handed back to the lessor.

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

A clear stipulation is made in Clause 10 thereof that there

will be no extension to the period of lease on its expiry of

25 years. This brings us to the conclusion of the

appellant's contention that being in continuous

possession post the expiry, he acquired the protection of

statutory tenant. Perusal of the order of the learned

Single Judge indicates that having conjointly examined

the submissions with regard to having acquired the

protection as a statutory tenant together with the plea of

adverse possession, the learned Single Judge observed as

under:

"7.8.From the aforesaid facts as well as basic facts narrated herein above, it clearly transpires that lease has expired long back on 18.12.1982 and that the respondent no.1 is in possession of the land in question without any authority. That on the basis of documents which are referred to herein above, the contention raised by the respondent no.1 that company when it was not wound up has not demanded the possession, is factually incorrect. The facts also prove beyond doubt that even respondent no.1 company is not working concern and has ceased its operation permanently since 1.5.1996 when even electricity connection came to be disconnected by the PGVCL.

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

7.9. As discussed herein above, clause 8 and 10 of the registered leased deed dated 28.01.1966 clearly postulates that the lease was for a fixed period of 25 years and same expired on 18.12.1982 and that respondent no.1 was to give back the possession and that there was no renewal or extension clause inter alia provided in it. Though, the contention of statutory tenant and adverse possession as well as limitation are raised before this Court the conduct of the respondent no.1 clearly spells out that no such claim was raised when the company was in working condition and not wound up and on the contrary at that stage also the negotiations for purchase of land in question took place between the respondent no.1 and the company. As can be seen from the record of this application itself on an attempt being made by the Official Liquidator to dispose of the properties of the company in liquidation, the respondent no.1 gave its offer and therefore, on the basis of facts and conduct of the respondent no.1 it is matter of fact that the respondent no.1 is not a going concern and no industry is being run and is in possession of the land in question even after the lease has expired. Learned counsel for the respondent no.1 has claimed that by virtue of adverse possession the respondent no.1 has become the owner of the land in question and that the present application filed by the Official Liquidator on 21.07.2011 is beyond the time prescribed for in Article 65 of the Limitation Act. The said plea is taken during the course of hearing of this

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

application. However, the respondent no.1 has not been able to bring any evidence on record to show that in fact when the possession became adverse. As the record indicates that when company which was not wound up and was still in working condition did demand back possession from the respondent no.1. Till 22.02.2007, respondent no.1 was declared sick unit under SICA and in facts of this case, it cannot be said that the possession of the respondent no.1 was hostile to the real owner in facts of this case. As held by the Hon'ble Apex Court in the case of Ram Nagina Rai (Supra) by mere denial of other's title the possession would not make his possession adverse so as to give himself the benefit of the statute of limitation. Ratio laid down by the Hon'ble Supreme Court in the case of Ram Nagina Rai (Supra) would squarely apply to the case on hand and it cannot be said that the possession is adverse in any manner.

7.10. It would be appropriate to refer to the judgment relied upon by the Shri Gori, learned advocate for the respondent no.2 workers union in the case of Larsen and Turbro Limited Club House Road, Madras (supra) C. Albert Morris(supra), Leelaben Gajanan Pansare (supra), Ravindra Ishwardas Sethna (supra) and Ramjumar Sukhchandan Gupta (supra). In case on hand also except bare contention being raised, it cannot be said that the possession of the respondent no.1 is adverse possession and as held by the Hon'ble Supreme Court in the said case only because respondent no.1 has continued in possession, it will not

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

acquire adverse possession by simply remaining in possession and in facts of this case, it cannot be said that respondent no.1 possession become adverse to the interest of the real owner and therefore, contention that by virtue of adverse possession, respondent no.1 is in possession and by applicability of Article 65 of the Limitation Act, the present application filed in 2011 is barred by limitation, deserves to be negatived outright. In facts of this, it cannot be said that the possession of the respondent no.1 is adverse to the applicant i.e. Official Liquidator and therefore, it cannot be said that the present application is barred by Article 65 of the Limitation Act.

8.0. Considering second contention raised by the respondent no.1 to the effect that application is barred by limitation by virtue of Article 67 of the Limitation Act, it deserves to be noted that the lease period came to an end on 19.12.1982 and when company was in working condition did demand back the possession from the respondent no.1, which is already discussed herein above, more particularly, by communication dated 11.11.1986 and 18.09.1987. The winding up order came to be passed on 22.12.1989.

8.1. Section 456(2) of the Companies Act, reads as under:

"456. Custody of company's property.--


                (1)   xxxx

                (2)All the property and effects                       of the
                company shall be   deemed   to                        be  in





                                                                                   NEUTRAL CITATION




C/OJA/10/2019                                  CAV JUDGMENT DATED: 19/08/2023

                                                                                   undefined




                the custody of the Court as from                             the
                date of the order for the winding                             up
                of the company."

8.2. Thus, on the date of winding up i.e. 22.12.1989 by virtue of Section 456(2) of the Companies Act, all assets of the company in liquidation including the land in question vested in custody of this Court and the possession of the respondent no.1 is unauthorized and illegal and as held by this Court in order

of 2010, thus the respondent no.1 is nothing else than the trespasser and the said finding is not challenged by the respondent no.1. As discussed herein above, by condition nos. 8 and 10 of the lease deed, the respondent no.1 had specifically agreed that on expiry of the lease period, the possession of the land in question would be handed over to M/s.

Maharana Mills Company Limited i.e. company in liquidation and even though demanded, respondent no.1 has failed to give back the possession and in such circumstances the land in question having been in deemed custody of this Court, as can be seen from the order of winding up of the company, it cannot be said that the present application filed on 21.07.2011 would be barred by Article 67 r/w Section 27 of the Limitation Act and it cannot be said that right of Official Liquidator stands extinguished. As discussed herein above, respondent no.1 company was declared to be Sick company from 1996 till 2007 and even considering said vital fact, it cannot be said that present application is time barred and Article 67 of

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

the Limitation would not be attracted in the present case.

8.3. Even applying provision of Section 108(q) of the Transfer of Property Act on determination of lease,, the respondent no.1 as lessee is bound to put lessor i.e. company in liquidation into possession of the property. It is also matter of record that the company in liquidation when it was in working condition did demand the possession and the Official Liquidator also raised the similar demand and thus the possession of the respondent no.1 is without any authority and illegal and therefore, the respondent no.1 has no right to remain in physical and actual possession of the land in question. Applying the principle of Section 111(A) of the Transfer of Property Act also the lease in question was for a specific period of 25 years without there being any renewal clause and therefore, on determination only option left with the respondent no.1 as a lessee was to return back the possession and therefore, in facts of this case, it cannot be said that the present application is barred by limitation as provided under Article 67 of the Limitation Act.

8.4. It is not the case of the applicant that the present application is filed for a direction directing the respondent no.1 to vacate the land in question only because the company i.e. M/s. Maharana Mills Company Limited is ordered to be wound up but it is the case of the Official Liquidator that the lease is determined way back in the year 1982 and the

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

respondent no.1 is in unauthorized and illegal possession of the land in question and therefore, the ratio laid down by the Hon'ble Supreme Court in the case of Smt. Nirmala R Bafna and Ors (supra) would not apply to the facts of the present case. It is also not the case of the respondent no.1 that lease period is yet to expire and therefore, the contention that the present application is barred by limitation, deserves to be negatived outright. In facts of this case, the contention raised by the respondent no.1 that he became the statutory tenant by virtue of provisions of Section 5(11)(b) of the Rent Act and that he is not trespassers to remain tenant by sufferance also is not well founded. Reliance placed on the judgment of the Hon'ble Peshawar High Court in the case of Ishar Dass s/o Murli Ram vs, Qazi Mohd. s/o Qazi Abdus Somad

with respect would not be applicable to the present case. The Hon'ble Peshawar High Court has decided the issue before it totally in a different context has come to the conclusion that even after determination the relationship of landlord and tenant continues. However, facts of this case are totally different and the said judgment would not be applicable. Moreover, the contention raised by learned counsel for the respondent no.1 that the respondent no.1 was ready and willing to pay the rent and is ready and willing to perform and observe other terms and conditions of the tenancy is contrary to the record. The record clearly establish and even letter of the company in liquidation when it was in operation in

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

the year 1987 clearly shows and even the letter of the respondent no.1 shows that the rent was paid only till expiry of 25 years of lease period and therefore, the very contention that the respondent no.1 has become a tenant by sufferance, deserves to be negatived. Moreover, payment of Rs.400/ per month rent was not only condition prescribed in the lease deed. Even if it is presumed that the provision of the Bombay Rent Act applies, the fact remains that as per condition no.7 and 8 and even condition no.10 the land was leased by M/s. Maharana Mills Company Limited company in liquidation for a specific purpose. It is also provided in the lease deed that two quarters were of the ownership of the company in liquidation and was given on lease and that to be used for the staff members of the respondent no.1 whereas the records clearly establish that much before winding up order, the activities of the respondent no.1 has already come to standing halt and except holding the land, the respondent no.1 has not done anything. It is not the case of the respondent no.1 that today industry in working condition and under such circumstances its right should be protected. As discussed herein above, even the respondent no.1 was declared to be sick unit under SICA in the year 1996 and remained under the umbrella of Section 20 of the SICA till 2007. Thus, record of this application clearly established that readiness and willingness to pay rent is only on paper. The conduct of the respondent no.1 is otherwise and therefore, it cannot be said that the respondent no.1 has complied with the

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

requirement of Section 12(1) of the Rent Act. Even considering the judgment of the Hon'ble Supreme Court in the case of Anand Nivas (supra) would be of no assistance to the respondent no.1. It is matter of fact that Rs.5 lakhs were deposited by virtue of order passed by this Court on 29.08.2005 which cannot be termed as payment towards rent and such contention is taken for the first time by respondent no.1 in this application. Similarly, even though it is contended that respondent no.1 is ready and willing to perform and observe other terms and conditions of the lease, as discussed herein above, the fact remains that the respondent no.1 is a closed unit and completely closed unit since 1996 without any electricity power and only exists on paper. Therefore, even considering the provision of the Rent Act, it cannot be said that the respondent no.1 is capable to carry out other condition of tenancy and merely payment of house tax and other legal taxes would not absolve the respondent no.1 from the fact that no rent is paid after the date of determination of the lease."

6.4 We have independently examined Clause 8 to 10 of

the lease deed and found that in accordance with the

provisions of Sec.108(q) of the Transfer of Properties Act

and Sec.111(a) thereof, it is apparent that on the

determination of the lease, the lessee is bound to put the

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

lessor into possession of the property. The lease of

immovable property in accordance with Sec.111

determines by efflux of time limited thereby. Sec. 108 and

Sec.111(a) read as under:

"108. Rights and liabilities of lessor and lessee.-

XXX XXX XXX

(q) on the determination of the lease, the lessee is bound to put the lessor into possession of the property.

XXX XXX XXX

111 Determination of Lease:-

(a) by efflux of time limited thereby."

6.5 As far as the contention of the appellant with regard

to acquiring the protection under Sec. 5(11)(b) r/w. Sec.

12 of the Act is concerned, it is apparent that such a

submission falls on the face of it as recorded by the

learned Single Judge in para 7.4 of the order, where an

extract of the order dated 10.08.2011 passed by this

Court is reproduced in OLR 139 of 2010. A categorical

finding of fact was recorded by the Company Court that

the appellant was under unauthorized occupation. Para

7.4 of the order of the learned Single Judge reads as

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

under:

"7.4.Furthermore, it is necessary to refer to the order dated 10.08.2011 passed by this Court (Coram: Hon'ble Mr. Justice K.M. Thakar) in OLR No. 139 of 2010. In para 3 this Court has observed thus:

                  "3.      So        as      to       enable       the
                  Official     Liquidator      to ascertain as to

whether the lease in respect of land described at lot No.B on page 2 of the report dated 1 st December 2010 has come to an end, and since, other connected matter is to come up for hearing on 30th August 2011, for the present, the proceedings of present application/ report are adjourned to 30th August 2011. In the meanwhile the Official Liquidator may consider the matter and explore other suggestions or possibilities for getting the possession of the part of the land which is presently under unauthorized occupation by the establishment viz. Jagdish Oil Mill..."

6.6 It is in light of these facts that considering the

decision in the case of Albert Morris(supra) and

Larsen & Turbo (supra), the learned Single Judge

opined that the lease have not been terminated and there

was no readiness and willingess to pay rent and in fact,

the same was not paid, which warranted taking over of

NEUTRAL CITATION

C/OJA/10/2019 CAV JUDGMENT DATED: 19/08/2023

undefined

the possession of the appellant's land. Paragraphs 7.8 to

7.10 which have been reproduced hereinabove indicate

that the learned Single Judge in the opinion of this Court