Rent control exemption for large companies upheld; later capital reduction could not defeat the landlord's accrued eviction right.

The Maharashtra Rent Control Act exemption for public limited companies with paid-up share capital of one crore rupees or more was upheld as valid, and the tenant-company was outside the Act because its share capital exceeded that threshold on the date of termination and suit. A later unilateral reduction of capital, not lawfully approved, could not defeat the landlord's accrued right to eviction, and pendency of proceedings under the Sick Industrial Companies Act, 1985 did not bar the eviction action. No equitable interference was warranted under Article 136 because the tenant remained in substantial arrears.

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Issues: (i) Whether Section 3(1)(b) of the Maharashtra Rent Control Act, 1999 was constitutionally valid and whether the tenant-company was outside the protection of the Act because its paid-up share capital was one crore rupees or more; (ii) whether a later unilateral reduction of share capital and the pendency of proceedings under the Sick Industrial Companies Act, 1985 barred eviction or altered the landlord's accrued right; (iii) whether discretionary relief under Article 136 of the Constitution of India should be granted.

Issue (i): Whether Section 3(1)(b) of the Maharashtra Rent Control Act, 1999 was constitutionally valid and whether the tenant-company was outside the protection of the Act because its paid-up share capital was one crore rupees or more.

Analysis: The exemption under Section 3(1)(b) applied to public limited companies having paid-up share capital of one crore rupees or more. The challenge to the classification had already been rejected in earlier proceedings and the provision was held to be a valid legislative policy based on an intelligible distinction. On the facts, the tenant-company's paid-up share capital exceeded one crore rupees when the tenancy was terminated and when the suit was filed, so the Rent Act did not apply.

Conclusion: The provision was valid and the tenant-company fell within the exemption under the Rent Act.

Issue (ii): Whether a later unilateral reduction of share capital and the pendency of proceedings under the Sick Industrial Companies Act, 1985 barred eviction or altered the landlord's accrued right.

Analysis: The Court treated the paid-up share capital as a jurisdictional fact, but found that the fact existed on the relevant date. A subsequent unilateral resolution to reduce capital, not approved by the BIFR, could not defeat the landlord's accrued right after valid termination of tenancy. The pendency of proceedings under the Sick Industrial Companies Act, 1985 did not bar eviction proceedings, and the statutory suspension under Section 22 did not operate as a prohibition against such action.

Conclusion: The later reduction of share capital and the SICA proceedings did not prevent the eviction decree.

Issue (iii): Whether discretionary relief under Article 136 of the Constitution of India should be granted.

Analysis: The tenant had remained in substantial arrears and had not shown any equitable basis for interference. The long non-payment of rent or mesne profits weighed against the grant of discretionary relief.

Conclusion: No equitable relief was warranted under Article 136.

Final Conclusion: The eviction decree was upheld because the Rent Act exemption applied on the relevant date, the later reduction of capital did not unsettle the accrued right of the landlord, and no equitable ground justified interference.

Ratio Decidendi: Where the tenant-company's paid-up share capital exceeded the statutory threshold on the date of termination and suit, the premises fell outside the Rent Act, and a later unilateral reduction of capital without lawful approval could not defeat the landlord's accrued right to eviction.

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