Post-petition tenancy does not defeat the liquidator's right to possession and realization of company assets.

Tenancy created after presentation of a winding up petition is vulnerable to being treated as a void transfer or act of insolvency and does not defeat the liquidator's statutory custody and control or his power to realize company assets; accordingly a post-petition tenant may not resist eviction by the Official Liquidator. Applications to review or recall earlier orders declaring otherwise were rejected because the tenancy arose post-petition and was not shown to be in the ordinary course of business. Offers by the tenant or low opportunistic bids were held unsuitable; possession must be delivered to the Official Liquidator for realization.

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Issues: (i) Whether a person in possession as tenant of company property after presentation of a winding up petition can resist eviction by the Official Liquidator; (ii) Whether orders dated 27-8-1999, 12-5-2000 and 25-8-2000 are liable to be reviewed or recalled in favour of declaring the applicant a lawful tenant; (iii) Whether the tenant's offer to purchase or other applications concerning sale of the property should be accepted.

Issue (i): Whether a tenant who entered into tenancy after the presentation of the company petition can lawfully resist eviction and prevent the Official Liquidator from taking possession or selling the property.

Analysis: Section 456 vests custody and control of company property in the liquidator upon winding up; section 457 empowers sale of company assets with Court sanction; section 477(6) permits the Court to order delivery of company property from persons found in possession; sections 531 and 531A render certain transfers or dispositions in proximity to winding up void as fraudulent preferences. The tenancy was created after the company petition was filed. Transfers or rights created after institution of the petition are not protected where they are not in the ordinary course of business and fall within the statutory provisions rendering such acts void against the liquidator. The statutory framework distinguishes the statutory status and powers of an Official Liquidator from a receiver appointed under Order XL, Rule 1, C.P.C., and places the liquidator in a superior statutory position to take possession and realize assets for distribution.

Conclusion: Tenant cannot lawfully resist eviction; the Official Liquidator is entitled to take possession and realize the property for winding up purposes.

Issue (ii): Whether the earlier orders dated 27-8-1999, 12-5-2000 and 25-8-2000 should be reviewed or recalled to declare the applicant a lawful tenant.

Analysis: The lease was created after presentation of the company petition and is therefore susceptible to being treated as an act of insolvency or a void transfer under sections 531/531A. The applicant has not shown sufficient cause to disturb the earlier orders; the factual and legal position that the tenancy was created post-petition and not in the ordinary course of business supports denial of review.

Conclusion: The review applications are rejected and the earlier orders are not recalled; no declaration of lawful tenancy is granted to the applicant.

Issue (iii): Whether the tenant's offer to purchase the property or other third-party offers for sale should be accepted.

Analysis: Continued occupation by a tenant reduces marketability and realizable value; offers must conform to the law and market value; a low offer inconsistent with the property's value is unsuitable. The applicant did not make a timely acceptable offer despite opportunities to do so.

Conclusion: The tenant's offer to purchase is rejected and opportunistic offers inconsistent with market value are not accepted; possession must be delivered to the Official Liquidator by the date specified.

Final Conclusion: The Official Liquidator's statutory right to custody, control and realization of company property created by sections 456, 457 and related provisions prevails over tenancy rights created after presentation of the winding up petition; the tenant's applications are dismissed and possession is ordered delivered to the Official Liquidator.

Ratio Decidendi: Where a tenancy or transfer in respect of company property is created after presentation of a winding up petition and not in the ordinary course of the company's business, such transfer may be void as against the liquidator and the liquidator is entitled under sections 456, 457 and 477(6) of the Companies Act, 1956 to take possession and realize the assets for the purposes of winding up.

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