Company Court jurisdiction in winding up extends to eviction, with limitation saved by special exclusion rules.

Section 446(2) of the Companies Act, 1956 gives the Company Court wide summary jurisdiction in winding-up matters to entertain an Official Liquidator's request for eviction and recovery of company property without requiring a separate suit. Limitation was held to run from enforceability of the consent decree, not from a prior possession claim, and the special exclusion under section 458-A had to be applied, making the application timely. Occupants who defaulted in payment and ignored later deposit directions were treated as unauthorized occupants, and their reliance on municipal tax receipts or subletting did not confer lawful possession. The premises were therefore recoverable with police protection.

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Issues: (i) whether the Company Court had jurisdiction under the winding-up provisions to entertain the Official Liquidator's application for eviction and recovery of possession without requiring a separate suit; (ii) whether the application was barred by limitation under the Limitation Act, 1963, having regard to section 458-A of the Companies Act, 1956; and (iii) whether the occupants were liable to be treated as encroachers or unauthorized occupants and evicted for default under the consent decree and subsequent directions of the Court.

Issue (i): Whether the Company Court had jurisdiction under the winding-up provisions to entertain the Official Liquidator's application for eviction and recovery of possession without requiring a separate suit.

Analysis: Section 446(2) of the Companies Act, 1956 confers wide jurisdiction on the Company Court to entertain and dispose of claims, questions of law or fact, and proceedings arising in the course of winding up. The object of the provision is to avoid unnecessary litigation, protect company assets, and enable expeditious realization of assets by the Official Liquidator. Proceedings for recovery of property in the possession of persons claiming through the company fall within this summary jurisdiction.

Conclusion: The application was maintainable before the Company Court and no separate suit was necessary.

Issue (ii): Whether the application was barred by limitation under the Limitation Act, 1963, having regard to section 458-A of the Companies Act, 1956.

Analysis: The application was not one based on previous possession but on title and enforcement of the consent decree dated 18-12-1978. Article 64 of the Limitation Act, 1963 was therefore inapplicable. Article 137 of the Limitation Act, 1963 also had no application to the facts. The decree became executable on default in payment of compensation, and the running of limitation had to be computed with exclusion of the winding-up period and one further year under section 458-A of the Companies Act, 1956. On that computation, the application filed on 26-9-2001 was within time.

Conclusion: The plea of limitation failed.

Issue (iii): Whether the occupants were liable to be treated as encroachers or unauthorized occupants and evicted for default under the consent decree and subsequent directions of the Court.

Analysis: The consent decree required monthly payment of compensation and stipulated that default would entitle the plaintiff to recover vacant possession. The occupants admittedly defaulted in payment from 1986 or, at the latest, 1987, and also failed to comply with the Court's later direction requiring monthly deposits. The plea based on municipal tax receipts did not confer title or lawful possession, and the subletting arrangement could not defeat the Company's rights under the decree. The conduct of the occupants showed continuing unauthorized occupation and failure to comply with binding directions.

Conclusion: The occupants were liable to be evicted as encroachers and unauthorized occupants.

Final Conclusion: The Official Liquidator was entitled to recover possession of the premises with police protection, and the earlier directions for handing over vacant and peaceful possession were revived.

Ratio Decidendi: In winding-up proceedings, the Company Court may summarily order eviction and recovery of company property from persons claiming through the company where default under a decree is established, and limitation is computed by applying the special exclusion under section 458-A of the Companies Act, 1956.

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