Court directs Official Liquidator to disclaim lease, relieve company from rent. Possession through legal means. Costs awarded.

The court allowed the application, directing the Official Liquidator to disclaim the leasehold interest to relieve the company from ongoing rental liability. The court specified that possession should be obtained through legal means to ensure the current occupant was not unlawfully dispossessed. Costs were awarded against the opposing parties.

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Issues Involved:
1. Leave for Applicants to Make the Application
2. Condonation of Delay
3. Disclaimer of Leasehold Interest
4. Role of the Official Liquidator
5. Objections by Intervenors
6. Objections by Banks
7. Maintainability of Application
8. Direction for Delivery of Possession

Issue-wise Analysis:

1. Leave for Applicants to Make the Application:
The applicants sought leave to make the application for an order directing the respondent-Official Liquidator to disclaim and/or give possession of a flat as per the lease agreement dated May 24, 1985.

2. Condonation of Delay:
The applicants argued that they became aware of the company's liquidation on November 28, 2002, and subsequently learned that the company had gone into liquidation by orders dated December 6, 1999, and November 26, 2001. The delay in filing the application was attributed to these discoveries and was sought to be condoned.

3. Disclaimer of Leasehold Interest:
The substantive prayer was based on the lease's expiration by efflux of time on December 31, 2000, and the stipulation in Clause IV(c) that the lease would cease if the tenant went into liquidation. The applicants argued that the leasehold interest was not saleable and should be disclaimed.

4. Role of the Official Liquidator:
The Official Liquidator, represented by counsel, argued that he had been discharged from any liability in taking possession of the company's assets by a court order dated November 26, 2001, and thus could not disclaim the property.

5. Objections by Intervenors:
The intervenor, an erstwhile Managing Director, resisted the application on several grounds, including a claim that he was residing in the flat and had made arrangements to continue residing there after the lease expired. The court found that the intervenor's actions constituted fraud as he continued to represent the company post-liquidation without disclosing its status.

6. Objections by Banks:
Allahabad Bank and ICICI Bank opposed the disclaimer, arguing that recovery proceedings were ongoing and a Receiver had been appointed. The court held that these proceedings were for debt recovery and not related to the winding-up process under the Companies Act.

7. Maintainability of Application:
The court rejected the argument that the application was not maintainable due to the Official Liquidator's discharge, stating that the discharge was limited to taking possession at the instance of secured creditors and did not absolve the Liquidator from other statutory obligations.

8. Direction for Delivery of Possession:
The court concluded that the leasehold interest was not necessary for the winding-up proceedings and directed the Official Liquidator to disclaim the leasehold interest to save the company from recurring liabilities. However, the court clarified that actual possession could only be taken through due process of law and not by direct order.

Conclusion:
The application was allowed, directing the Official Liquidator to disclaim the leasehold interest to relieve the company from ongoing rental liability. The court also specified that possession should be obtained through legal means, ensuring the current occupant was not dispossessed unlawfully. Costs were awarded against the opposing parties.

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