TaxTMI 
TaxTMI 
TaxTMI 
2015 (5) TMI 440
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....It was the common case of all three lots of applicants that they had no notice of the proceedings that culminated in the order of January 22, 2013. Such order was made on an application under Section 535 of the Act and the relevant part of the operative portion of the order read as follows: "So far the balance area of 1030 sq. ft. is concerned no one intervened nor there is any objection by anyone. Therefore, the Official Liquidator is also directed to remove trespassers if any from the said area of 1030 sq. ft. and hand over vacant possession to the applicant. In the event, the Official Liquidator requires any police assistance for vacating the said 1030 sq. ft. area, he will seek police assistance from the concerned Police Station and the Officer-in-Charge of the concerned Police Station is directed to render all assistance to the Official Liquidator." 3. The applicant in the proceedings in the nature of disclaimer was one PDGD Investments & Trading (P) Ltd. It is such party which has opposed the present application. 4. The order of March 13, 2013 passed at the time of receiving, inter alia, the present application noticed that the minutes prepared by the official liquidator o....
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....s the lessor), claimed in such application to be the owner of the entirety of the second floor of premises No. 14 N. S. Road. The application said that the company in liquidation was a monthly tenant under the lessor in respect of a demarcated portion of 2621 sq. ft on the eastern side of the second floor of the building. The company, prior to its liquidation, was said to have obtained the tenancy from one Venkatesh Company Ltd. The lessor claimed that Venkatesh Company Ltd was a party to a scheme of arrangement sanctioned by this court on February 1, 2006 under which the demerged division of Venkatesh, including the second floor of premises No. 14 N. S. Road, was transferred to and stood vested in the lessor. The lessor asserted that it had given notice to the company in liquidation on June 4, 2007 to pay fair rent and other charges but complained that no rent of any kind had been received by the lessor from the company in liquidation after May, 2007. The lessor alleged in the application that the lessor was informed by the official liquidator's letter of February 13, 2009 that the official liquidator had not obtained possession of the said premises and that third parties were....
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....o the applicant; (e) An order of injunction restraining the respondent from dealing with and/or disposing of the said tenanted premises in any manner except for the purpose of disclaiming the said property; (f) Ad-interim orders in terms of prayers above; (g) Costs of this application be paid by the respondent; (h) Such further or other order or orders be passed and/or direction or directions be given as to this Hon'ble Court may deem fit and proper." 9. The order of January 22, 2013 on CA No. 325 of 2010 recognised the application to be one for disclaimer under Section 535 of the Act. It appears that the thrust of the submission on behalf of the lessor, as recorded in the relevant order, was that the official liquidator had no use of the said premises and the three named occupants thereat had no right, title or interest in respect thereof. The order noticed that the official liquidator had accepted that retaining the said premises by the official liquidator was onerous and it could be disclaimed, but the named occupants had sought to resist the disclaimer. The following submission attributed to the lessor is of some relevance: "... Mr. Mukherjee submitted the objection t....
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....revents even a trespasser from being dispossessed of any immovable property under his possession except by procedure established by law, even if the applicants had been impleaded in the disclaimer proceedings their eviction could not have been sought or obtained thereat. The applicants spare no occasion to remind the court that the scope of the application carried by the lessor to the company court was not as wide as the ultimate order passed in its favour. 13. The applicants refer to the provisions of the West Bengal Premises Tenancy Act, 1956 as they deem such Act to be relevant in the context of their induction into a part of the said premises. They place several provisions from the successor statute of 1997 to emphasise on the protection that an occupant at an immovable property enjoys thereunder. Section 12A of the West Bengal Premises Tenancy Act, 1997 has been invoked by the applicants to suggest that no court other than the civil court recognised therein would have the authority to receive a claim for the eviction of a person entitled to protection under the said Act from any immovable property. 14. The ultimate argument of the applicants is that in view of Section 12A of....
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....n Employees Provident Fund Commissioner (supra) two statutes of the same legislature were again considered and the Supreme Court ruled that the provisions of the later Act would prevail. It was the same observation in Ashoka Marketing Ltd. (supra) where the later special Act was seen to hold sway over the earlier general statute. 17. In Indu Bhushan Bose (supra) the matter pertained to the operation of a State rent control Act in a cantonment area and the Supreme Court agreed with the High Court that the notification by which the operation of the rent control Act had been extended to the cantonment area was ultra vires the Constitution and void. In Accountant and Secretarial Services (P.) Ltd. (supra) the Supreme Court held that Entries 6, 7 and 13 of List III of the Seventh Schedule to the Constitution governed tenancy legislation and not Entry 18 of List III. 18. In M. Karunanidhi (supra) the Supreme Court applied the pith substance test to unravel the substantial legal conundrum in that case. 19. In addition to the above judgments on the perceived conflict between Section 446 of the 1956 Act enacted by the Parliament and Section 12A of the 1997 Act of the State, the applicant....
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....y any State law. The lessor points out that it is not in dispute that the Companies Act, 1956 has been enacted by the Parliament in respect of a matter covered by List I in the Seventh Schedule. 21. The lessor emphasises that the pith and substance test, that is recognised in several Supreme Court decisions in resolving any apparent conflict of laws, does not apply to any law made by the Parliament in respect of a matter covered by the Union List qua any State law whether made under the State List or the Concurrent List. The methodology in assessing a challenge on the ground of legislative competence, the lessor asserts, would involve several considerations including the determination of the Lists and the Entries which cover the subject-matters of the apparently conflicting enactments. The lessor says that in making the assessment for such purpose, it is not necessary to look for the reference to the relevant Lists or Entries in the two apparently conflicting statutes; as neither the Parliament nor any State legislature is obliged to indicate the same. The lessor submits that the Lists and the Entries covered by the apparently conflicting enactments have to be discerned from the s....
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....ng of Article 246 (1) of the Constitution and the exclusive authority of a State legislature to make laws for such State with respect to any of the matters enumerated in the State List being subject to the legislative supremacy of the Parliament as recognised in the Article. As to the tests to be applied in determining legislative competence upon a State law being in apparent conflict with a statute enacted by the Parliament, the lessor has referred to the decision Hoechst Pharmaceuticals Ltd. v. State of Bihar [1983] 4 SCC 45. 26. The lessor has referred to a Constitution Bench judgment at Kerala State Electricity Board v. Indian Aluminum Co. Ltd. [1976] 1 SCC 466 where the essence of the "pith and substance test" was described by the Supreme Court in the following words at paragraph 5 of the report: "If in pith and substance a legislation falls within one list or the other but some portion of the subject-matter of that legislation incidentally trenches upon and might come to fall under another list, the Act as a whole would be valid notwithstanding such incidental trenching." 27. The lessor suggests that since this High Court exercises original jurisdiction and the property at....
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....e relevant application was allowed and the appellant was directed to deliver vacant possession of the relevant premises upon being declared a trespasser thereat. The primary ground urged in the appeal was that the relevant room was not the property of the company in liquidation and the official liquidator had not taken possession thereof. The Division Bench referred to an unreported judgment of another Division Bench of this court Indramoni v. Shriram Jute Mills (P.) Ltd. [Appeal No. 154 of 1976 dated December 6, 1976] and concluded that the authority under Section 446(2) of the 1956 Act was wide and proceedings thereunder for eviction would be regarded as "due process of law." 29. In Tata Steel Ltd. (supra) this court accepted that the authority available under Section 446(2) of the Companies Act was wide enough to entertain and adjudicate on a claim for eviction made in connection with a company in liquidation. However, as would appear from the judgment in East India Trading Co. (supra) and the view taken by the company court as evident therein, that notwithstanding the authority available to the company court under Section 446(2) of the 1956 Act, a claim for eviction may, ordin....
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.... a sub-tenant has no independent legal status and is not entitled to the benefits of protection against eviction." 31. In Wellman Wacoma (supra) the Division Bench considered the scope of Section 535 of the Companies Act read with Section 446 thereof. It was held that the power was wide and it is necessary to see the authority thereunder to be wide since the purpose of Section 446 of the Act was to streamline the process of winding-up. The judgment also referred to what would amount to "due process of law" in the context of the adjudication of a claim for eviction under Section 535 of the Companies Act read with Section 446 thereof. A similar view was expressed in the unreported judgment of a Division Bench in SST Media (P.) Ltd. 32. In Biswanath Poddar (supra) the Supreme Court held that any statement made in an agreement between a tenant and a sub-tenant as to the tenant having the owner's consent to sub-let the premises, would not be binding on the owner unless it was demonstrated by cogent evidence that the owner had issued a previous written consent to the tenant to create the sub-tenancy. 33. Before taking up the real issue as to the ambit of the authority available to....
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....uently made under the Concurrent List with Presidential assent, may only be a consideration relevant for the company court as to whether the jurisdiction ought to be wielded or an element of self-restraint should be exercised in dealing with the lis. That a court has the authority to adjudicate a matter may not necessarily prompt the court to take up the adjudication, if the court finds that there is an equally convenient and efficacious forum specifically designated therefor. But the existence of such alternative forum cannot be cited to suggest that the court had been robbed of its authority to adjudicate on the lis upon the creation of the alternate forum, unless the subsequent enactment specifically provides therefor and the legality of such provision is beyond question. 36. If, however, the repugnancy had occurred as a result of a provision in a subsequent State law that had received the Presidential assent being in conflict with a previous law enacted by the Parliament in respect of any matter in the Concurrent List, the provision in the State law would have prevailed. The applicants appear to perceive that a State law made in respect of a matter in the Concurrent List that ....
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....or otherwise, the company court should deal with the matter itself. But when an applicant claims that the possession of the applicant's property had been wrongfully parted with by the company in liquidation, several other considerations come into play to assess whether the jurisdiction which is available to the company court ought to be exercised to decide the whole or a part of the claim. For instance, there could be a claim before the company court that those in control of a company in liquidation had fraudulently parted with possession of the tenanted premised in favour of an alter ego after the commencement of the liquidation proceedings; or, that an encroacher had trespassed into the property in question when the official liquidator was already in possession thereof. Such matters may excite the company court to adjudicate the claim in its entirety; but the same claim with a slight twist to the facts may prompt the company court to adjudicate a part of the claim in so far as it directly pertains to the company in liquidation and allow the applicant to obtain the other reliefs before a regular forum. 40. As would be evident from the judgment in Tata Steel Ltd. (supra) the c....
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....account of the inevitable delay of the laws and the judiciary attendant thereto, but they have a right to insist on a fair procedure being followed before it is concluded that they have no right to occupy the relevant premises. The applicants point out that even the basic adjudication of the title of the lessor was not undertaken in course of CA No. 325 of 2010 and such issue was decided on the concession of the official liquidator. The applicants lament that they were deprived of a fair opportunity to assert their rights to occupy the premises by virtue of the relevant clause in their agreement with the company prior to its liquidation and the chance to produce cogent evidence in support of the substance of the clause. After all, the applicants suggest, there was a different head-lessor at the time that they were inducted at the said premises. 43. There is a considerable basis to the applicants' submission on such score. Indeed, on the prima facie satisfaction of the immense prejudice caused to the applicants by the order dated January 22, 2013, they were allowed to go back into the possession of the said premises by the ad interim order passed on the present application. The....