Punjab-Haryana High Court
M/S Gilco Auto Engineers Pvt. Ltd vs Jagdish Inder Singh on 27 April, 2012
Author: Rakesh Kumar Garg
Bench: Rakesh Kumar Garg
CR No.4087 of 2010 1
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
CR No.4087 of 2010 (O&M)
Date of decision: 27.4.2012
M/s Gilco Auto Engineers Pvt. Ltd., ......Petitioner(s)
versus
Jagdish Inder Singh .......Respondent(s)
Coram: Hon'ble Mr. Justice Rakesh Kumar Garg
****
Present: Mr. M.L.Sarin, Sr. Advocate with Ms. Hemani Sarin,
Advocate for the petitioner.
Mr. Arun Palli, Sr. Advocate with Mr. Salim Malik,
Advocate for the respondent.
Rakesh Kumar Garg, J.
This is tenant's revision petition challenging the order dated 16.11.2009 of the Rent Controller, Chandigarh whereby its eviction was ordered from the demised premises and further the order dated 3.5.2010 of the Appellate Authority dismissing the appeal against the aforesaid order of eviction.
The respondent-landlord filed the instant ejectment petition against the petitioner i.e. M/s Gilco Auto Engineers Limited, 652, Industrial Area, Phase I, Chandigarh, through its Managing Director Saral Gill seeking its ejectment from House No.123, Sector 28-A, Chandigarh (hereinafter referred to as the 'demised premises') on the ground of arrears of rent and personal necessity.
As per the averments made in the ejectment petition, the demised premises was owned by late Major General Mohinder Singh, father of the respondent. It was let out to petitioner-Company vide CR No.4087 of 2010 2 registered lease deed dated 18.5.1984 at initial rent of Rs.4500/- per month and after gradual increase, the present rate of rent came to Rs.6500/- per month at the time of the filing of the petition. It was further stated that father of the respondent-landlord died on 25.5.1992 bequeathing the demised premises in his favour. Even otherwise, the respondent being one of the legal heirs was also entitled to maintain the present petition as a co-owner. After the death of his father, the petitioner started paying rent/depositing the same in a saving bank account No.3241 with Canara Bank Sector 35, Chandigarh. The petitioner lastly deposited the rent for the months of April and May, 1998 amounting to Rs.13000/- on 23.5.1998. Thereafter, the petitioner has not paid rent since 1.6.1998 onwards. It was further pleaded that earlier the respondent was doing farming and was living with his maternal uncle at Patiala. After his marriage on 4.7.2004, he shifted to Chandigarh in the month of January 2005 and occupied the first floor of House No.73, Sector 9-A, Chandigarh consisting of one bed room, one study room, one drawing cum dining, kitchen and two toilets on a rent of Rs.10,500/- per month. The respondent has been married in a well to do family and also connected with well to do families from paternal as well as maternal side. He has two cars but has not any lawn or place either to park his cars or to accommodate his guests. He was paying rent of Rs.10,500/- per month but getting rent of Rs.6500/- per month of the demised premises. He requested the petitioner to vacate the house which he refused. Hence, the petition for ejectment of the petitioner on the grounds of arrears of rent since 1.6.1998 onwards and personal use and occupation. The respondent has further averred that he has not vacated any premises in the urban area of Chandigarh nor he was in possession of any other CR No.4087 of 2010 3 accommodation.
Upon notice, the petitioner-Company appeared and filed written statement through Sh. Saral Gill raising various preliminary objections inter alia that the petition was not maintainable. It was further averred that the respondent has not approached the Court with clean hands as he had entered into an agreement to sell with Saral Gill on 25.7.1999 and received earnest money of Rs.8,50,000/- However, he resiled from the agreement and refused to sell the property and to return the money. So an understanding was arrived at between the parties to keep the aforesaid amount as advance rent and to adjust the interest on the said amount towards the rent due that is why the respondent has not demanded any rent since 1.6.1998 but the petitioner always wanted to settle the accounts. However, the respondent always pretended not to having any fund with him. The interest amount of the aforesaid amount was Rs.8500/- per month whereas the rent settled between the parties was Rs.6500/-per month. Thus, as per understanding, the petitioner did not file any suit for specific performance and the ejectment petition was not maintainable against the petitioner in the present form. On merits, the petitioner denied the ownership for want of knowledge and submitted that the respondent had took false plea of his residence as a tenant in House No.73, Sector 9-A, Chandigarh. In fact the said house was belonging to his near relative. The respondent was having sufficient accommodation in the said house. It was also stated that the petitioner was not in arrears of rent rather it had to receive the amount from the respondent on account of settlement of accounts. Rate of rent at Rs.6500/- per month was admitted. Rest of the contentions were denied and dismissal of the petition was prayed for.
CR No.4087 of 2010 4
The respondent did not file any replication. From the pleadings of the parties, the following issues were framed:
"1. Whether the respondent is in arrears of rent w.e.f.
1.6.1998 onwards? OPP
2. Whether the petitioner requires the demised premises for his personal use and occupation? OPP
3. Whether the petition is not maintainable under the Rent Act? OPR
4. Whether the petitioner has not approached this Court with clean hands as he has concealed the fact that he entered into an agreement to sell with Saral Gill on 25.7.1998? OPR
5. Whether the petition is not maintainable in the present form? OPR
6. Relief."
It is also relevant to mention that an application under Order 6 Rule 17 CPC was filed for amending the written statement to incorporate the fact that the company is not in existence however, the said application was dismissed vide order dated 22.9.2007 which reads thus:
"Arguments on application dt. 25.7.07 moved by the defendant under Order 6 Rule 17 CPC for amendment of the written statement heard. It has been submitted that the respondent-Company has since become defunct. Vide application dt. 30.7.2005 an application for striking of its claim was submitted to the Registrar of Companies, Jalandhar along with prescribed fee. As the company is the only respondent, the present petition is not maintainable against it. This CR No.4087 of 2010 5 fact came to the notice of one respondent on 24.7.07. Hence the present application to incorporate the preliminary objection No.4 in the written statement.
In the reply filed by the petitioner it has been submitted that the lease was created against the respondent who is in possession of the demised premises. It has been denied that the company has become defunct as alleged. On 30.06.2006 the respondent Company tendered the rent to the tune of Rs.8,23,280/-. The respondent company still continued to be the tenant. The present application has been filed by Saral Gill with mala fide intention and therefore deserve dismissal.
During arguments both the ld. Counsel for the parties reiterated the facts as contained in the application/reply.
After hearing ld. Counsel for the parties, I have again perused the file. The present petition was received for assessment in this Court on 31.10.2005. After perusing through Miscellaneous proceedings, issues were framed on 26.9.2007 by the then ld. RC, Chandigarh. It was only after the present application was moved. The applicant/respondent has relied upon the application dt. 30.7.05 moved by the Company to the Registrar of Companies, Jalandhar. Meaning thereby the basis of the application is a fact which allegedly took place prior to the filing of even rent petition on 29.10.2005. Upon notice the respondent appeared and contested the proceedings playing his role. As per proviso to Order 6 Rule 17 CPC, no application for amendment shall be allowed after the trial has commenced, unless the Court comes to the conclusion that in spite of due diligence, the party could not have raised the matter before the commencement of trial.
In view of the facts discussed above the Court is CR No.4087 of 2010 6 not of the opinion that despite due diligence the party could not have raised the matter before commencement of the trial, therefore, the applicant/respondent's claim is not covered under the provisions of Order 6 Rule 17 CPC. Accordingly, the application stands rejected with costs Rs.500/-.
Now to come up on 28.11.2007 for cross-
examination of PWs. Ld. Counsel for the petitioner is directed to produce the witnesses on date fixed for the purpose of their cross-examination."
The aforesaid order of the Rent Controller was never challenged by the petitioner. Even no such argument was raised by the petitioner before the Rent Controller at the time of arguments in the main petition.
After examining the evidence and hearing counsel for the parties, the Rent Controller decided issue No.1 as infructuous, as arrears of rent having been tendered in the Court at the admitted rate of rent which was not disputed and were accepted by the counsel for the respondent- landlord vide statement of respondent's counsel dated 30.10.2006 made in the Court. Issue No.2 was decided in favour of the respondent-landlord and against the petitioner holding that need of the respondent-landlord was bona fide and he required the demised premises for his personal use and occupation. Issues No.3 and 5 were decided against the petitioner-tenant as both these issues were not pressed. However, issue No.4 was decided against the petitioner and in favour of the respondent-landlord holding that the contention of the petitioner regarding adjustment of amount towards rent was not tenable as the petitioner was bound to pay the rent till the execution of the sale deed as per clause 9 of the agreement and there was CR No.4087 of 2010 7 no document pertaining to any understanding in order to adjust the amount of earnest money towards rent. The said agreement had nothing to do with the ejectment petition filed under the provisions of Rent Act and it was for the petitioner to seek his civil remedy for relief in view the agreement Ex.R-1 and there was no concealment on the part of the landlord.
Feeling aggrieved from the order of eviction of the Rent Controller, the petitioner-Company filed an appeal before the Appellate Authority through Surinder Singh and Saral Gill. The grounds of appeal as submitted before the Appellate Authority read thus:
"1. That the respondent filed the rent petition for the eviction of the appellant from House No.123, Sector 28- A, Chandigarh on the ground of non payment of rent and personal requirement. The rate of rent is Rs.6500/- per month.
2. That the appellant is a tenant in House No.123, Sector 28-A, Chandigarh since 1984 and the premises were let out through a registered lease deed. Initially the rate of rent was Rs.4500/- per month, which was enhanced from time to time and now the rate of rent is Rs.6500/- per month.
3. That during the tenancy period, the respondent decided to sell the house and he entered into an agreement to sell with Mr. Saral Gill on 25.7.1999 for a total sale consideration of Rs.85.00 lakhs, out of Rs.8.50 lakhs were received as earnest money. The agreement to sell is Ex.R-1.
4. That due to some matrimonial problem of the respondent, he delayed the execution and registration of the sale deed and did not obtain NOC for sale from the Estate Officer as well as Income Tax Clearance certificate from the Income Tax Deptt as per clause 8 of Ex.R-1. Otherwise the last date for execution and CR No.4087 of 2010 8 registration
5. That due to execution of the agreement to sell, the respondent stopped receiving rent from the appellant and it was agreed that due to the payment of Rs.8.50 lacs, which is a very heavy amount, the respondent will not receive any rent and in lieu of charging interest on Rs.8.50 lacs, the rent shall be adjusted towards interest. The monthly interest @ 12% on Rs.8.50 lacs comes to Rs.8500/- per month, that is why it was agreed that in lieu of the interest, no rent shall be payable by the respondent. Although this settlement was oral but the learned Rent Controller has not given any weight to the arguments that why the respondent kept mum till 2005 after the execution of the agreement to sell on 25.7.1999. The petition has been filed after more than six years without any demand of rent. It is very important to mention here that till the filing of the petition, the respondent never served any notice for the cancellation of the agreement or forfeiture of the earnest money. This aspect has not been discussed in the judgment nor this aspect has been taken into consideration.
6. That while deciding the issue of personal requirement, the bonafide of the respondent is doubtful. In fact,the respondent has not taken any premises on rent, as alleged, in House No.73, Sector 9-A, Chandigarh. There are lot of contradiction in the statements of the witnesses of the respondent while appearing before the Rent Controller, which clearly proves that in fact, a fake tenancy has been created in House No.73, Sector 9-A, Chandigarh just to create a false ground of personal requirement. The landlord of the said house appeared as PW-3 has not produced any rent agreement and on the other hand, the petitioner and his brother-in-law are stating that there is a rent agreement. Even no proof of any payment of rent of CR No.4087 of 2010 9 the said house has been placed on file inspite of the fact that the same has been challenged by the appellant. In the absence of any proof of actual tenancy of House No.73, Sector 9-A, Chandigarh, there is no bonafide of the respondent and the ground of personal requirement is not made out. Hence, the petition was liable to be dismissed and the rent tendered is liable to be refunded.
7. That it was specifically pleaded that the appellant company is no more in existence and even at the time of arguments, the latest information obtained from the website of Registrar of Companies, Jallandhar was also produced, vide which it is clear that the appellant company M/s Gilco Auto Engineers Pvt. Ltd. is not in existence. However, the present appeal is being filed in its name now for the purpose of tenancy, both the brothers named in the heading of the plaint i.e. Surinder Singh Gill and Saral Gill have become the tenants of the premises. Inspite of this fact, the respondent did not amend the petition. Therefore, no eviction order can be passed against a company which is not in existence. Hence, on the grounds mentioned above, the ejectment order passed by the learned Rent Controller is liable to be set aside."
Vide judgment dated 3.5.2010, the said appeal was also dismissed by the Appellate Authority. The relevant part of the judgment reads thus:
"It is claimed that petition is not maintainable because he had entered into an agreement to sell this house to Saral Gill. That is correct. Petitioner too has admitted it in his statement. Although he has not disclosed this fact in his petition but he has not disputed his signature in the agreement to sell Ex.R-1. So, this cannot be treated to be a concealment.
It is claimed that once a landlord entered into an CR No.4087 of 2010 10 agreement to sell with the tenant, the relationship of landlord and tenant comes to an end. That is true. But simply entering into an agreement to sell is not sufficient to bind the parties in the present case. Landlord says this agreement was not acted upon because Saral Gill failed to pay Rs.20 lacs within three months after this agreement. So, they decided to apply Rs.8,50,000/- paid to him towards future rent. It has been denied by the appellant. According to it, this amount was to be kept as an advance and its interest was to be applied towards future interest.
It means they both admit that this agreement to sell between them was not acted upon and it was treated as cancelled that is why no suit for specific performance was brought. Money was also not demanded. Once they mutually rescinded this agreement neither of two can turn around and say that said agreement is still alive.
In such situation landlord can't be forced to give up his status. Hon'ble Supreme Court decided this question in case 'Shashi Kapila v. R.P. Ashwin PLR 2002 (1) VOL.CXXX 217. In that case admittedly appellant was tenant and respondent was landlord. He had entered into agreement to sell the house to appellant but it could not be materialized. Then tenant brought suit for specific performance. Same was resisted by landlord. There was clause in agreement that appellant was to pay arrears of rent till the date of compromise. In this case also appellant had claimed that interest was to be applied towards rent. It means appellant himself recognized the reversion to his pre- existing right of tenant. So, today he can not say that agreement to sell subsists and suit for ejectment under Rent Act is not maintainable. It is a different matter whether this principal amount was to be applied towards rent or its interest."CR No.4087 of 2010 11
Still not satisfied, the petitioner-Company has filed the instant revision petition before this Court challenging the impugned orders of the Authorities below. The memo of parties, describing the petitioner-Company as petitioner reads as follows:
"M/s Gilco Auto Engineers Pvt. Ltd., later known as Gilco Engineers Ltd., now dissolved, its name having been struck off pursuant to Section 560(5) of the Companies Act, 1956 from the Register of Registrar of Companies vide Notification dated 16.12.2006 published in the Gazette of India through its former Directors Mr. Surinder Singh and Mr. Saral Gill, r/o House No.123, Sector 28-A, Chandigarh.
........ Petitioner Versus Jagdish Virinder Singh s/o late Maj. Gen. Mohinder Singh, r/o House No.73, Sector 9-A, Chandigarh.
.......(Landlord)-Respondent"
Along with this petition, the petitioner has also placed on record certain documents as Annexures A-1 to A-5 which includes certificate of Registrar of Companies granting change of the name of the Company Gazette Notification dated 16.12.2006 striking off the name of the petitioner-Company from the Register of Registrar of Companies and dissolving the same under Section 560(5) of the Companies Act, agreement to sell dated 25.7.1999, registered lease deed dated 18.5.1984 between the parties and an order dated 22.9.2007 passed by the Rent Controller, Chandigarh rejecting the application of the petitioner for amendment of written statement seeking incorporation of the fact that the petitioner-Company has become defunct and since the Company was the CR No.4087 of 2010 12 only respondent before the Rent Controller, the petition was not maintainable.
It may also be relevant to notice that CM No.16812-CII of 2010 has also been filed to implead Saral Gill son of Sh.Iqbal Singh, s/o House No.123, Sector 28-A, Chandigarh on the ground that the aforesaid Saral Gill, who is former Director of petitioner-Company has become a direct tenant under the respondent-landlord and has been recognized as such under Clause 9 of the agreement to sell dated 25.7.1999. It was specifically averred in the application that aforesaid Saral Gill was in possession of the house in dispute and the impugned orders have been passed without giving him an opportunity of hearing whereas he is directly affected and aggrieved by the impugned orders and therefore, his presence is necessary in the present revision petition. The relevant averments of the said application reads as follows:
"That the applicant Mr. Saral Gill is a former Director of the abovementioned M/s Gilco Engineers Ltd. After the lease in favour of the abovenoted Company expired in 1987, the applicant became a direct tenant under the respondent, Jagdish Virinder Singh.
That the status of the applicant, as a direct tenant in the house in dispute was recognized by the landlord in Clause 9 this agreement to sell dated 25.7.1999."
The respondent-landlord filed reply to the aforesaid application for impleadment denying the averments of the applicant Saral Gill for becoming a direct tenant under the respondent or the owner of the property in dispute on the basis of agreement to sell dated 25.7.1999. The applicant Saral Gill has also filed a rejoinder to the aforesaid reply of the respondent-landlord to the application for impleadment.
On 12.7.2010, this Court passed the following order" CR No.4087 of 2010 13
"Notice of motion for 9.9.2010.
Notice Re: C.M.No.16812-CII of 2010 as well. Dispossession of the applicant-petitioner shall remain stayed."
The record of the case was also summoned.
Sh. M.L. Sarin, learned Senior Advocate appearing on behalf of the petitioner-Company as well as applicant-Saral Gill has vehemently argued that no ejectment order could have been passed against the petitioner-Company as the same had ceased to exist having been dissolved under Section 560(5) of the Companies Act vide notification dated 12.6.2006 published in the Gazette of India (Annexure A-2) attached with this petition whereby the name of the Company was struck off from the Register of Registrar of Companies. Both the Authorities below have failed to appreciate the fact that the present ejectment petition was not maintainable as it was filed against the Company which had become defunct and had ceased to exist much before the filing of the ejectment application which was filed on 31.10.2005 as it is well settled that no case can be filed against a dead person/non-existent person and as such the present ejectment application ought to have been dismissed outrightly.
Mr. Sarin has further pointed out that in the grounds of revision also it has been specifically mentioned by the petitioner-Company that the present ejectment application was not maintainable against the company as the said company was not only defunct but also had long ago ceased to be the tenant in the house in dispute and Sh. Saral Gill (applicant) was accepted as a tenant therein. It has been further argued by Sh. M.L. Sarin, Senior Advocate that the Authorities below have failed to CR No.4087 of 2010 14 appreciate the fact that there existed no relationship of landlord and tenant between the parties as the petitioner-Company has ceased to exist prior to the filing of the present ejectment application and Sh. Saral Gill who is admittedly in possession of the premises in dispute has also ceased to be the tenant once agreement to sell was executed on 25.7.1999 (Annexure A-3). It is the further case of the petitioner that the agreement to sell has never been denied and thus, the Authorities below have erred in ignoring the said document. It was also argued by Mr. Sarin that the Rent Controller had erred in law while dismissing the amendment application filed by applicant-Saral Gill. The said amendment goes to the very root of the case and the order dated 22.9.2007 of the Rent Controller rejecting the said application is totally illegal, arbitrary and erroneous. The said amendment ought to have been allowed as it was necessary for determining the real questions of controversy between the parties. Sh. Sarin, has further submitted that the possession over the premises in dispute is that of prospective buyers and was protected under section 53-A of the Transfer of Property Act and therefore, applicant-Saral Gill cannot be ejected in a petition under the Rent Act. On the basis of the aforesaid argument, Sh. Sarin, learned counsel appearing on behalf of the petitioner has prayed that the impugned orders of the Authorities below be set aside. Learned counsel appearing on behalf of the petitioner has relied upon various judgments reported as Anil Kumar versus Smt. Anguri Devi 2003(1) RCR 149, Shrikishen Dhoot and ors. vs. S.D. Kamlapurkur and Ors. 1965(35) CompCas 913 AP, Rajesh Kumar Aggarwal and others versus K.K. Modi and others 2006(4) SCC 385, Jai Parkash Gupta (D) thr.LRs versus Riyaz Ahamad & Anr. 2009(2) RCR 474, R.Kanthimathi and other versus Mrs. Beatrice Xavier 2001(3) CR No.4087 of 2010 15 PLR 587, Shrimant Shamrao Suryavanshi and another v. Pralhad Bhairoba Suryavanshi (dead) by LRs. and others AIR 2002 SC 960 and Ram Janam Singh versus State of Uttar Pradesh & Anr. JT 1994(1) SC
187. Lastly, it was argued by the learned counsel for the petitioner that admittedly Saral Gill is in possession of the tenanted premises and even if his title to the demised premises being direct tenant or prospective buyer is not accepted, he cannot be ejected in these proceedings as even a trespasser in long standing possession is entitled to defend his possession.
On the other hand, Sh. Arun Palli, learned Senior counsel appearing on behalf of the respondent-landlord has argued that admittedly the petitioner-Company, which was a legal entity, was the tenant under the respondent by virtue of lease deed dated 18.5.1984 and even the petitioner-Company has contested the ejectment petition by filing written statement on behalf of the Company wherein relationship of parties as tenant and landlord is not in dispute. Not only this, it was further averred in the written statement filed on behalf of the petitioner-Company that the respondent had entered into an agreement to sell with Saral Gill on 25.7.1999 and had received an earnest money of Rs.8,50,000/- and the landlord resiled from agreement and refused to sell the property and also refused to return the money and thereafter, an understanding was arrived at between the parties to keep the aforesaid amount as advance rent and to adjust the interest on the said amount towards the rent due and that is why no suit for specific performance was filed and in view of the aforesaid averments, the petitioner-Company cannot argue that there is no relationship of landlord-tenant between the parties or the instant petition is not maintainable against the petitioner. Even the written statement dated 27.9.2006 was filed by Saral Gill as Managing Director of the petitioner- CR No.4087 of 2010 16 Company whereas the application to struck off the name of the petitioner- Company from the Register of Registrar of Companies was filed much earlier to the aforesaid date by the petitioner-Company. However, the said fact was never brought to the notice of the Court. Even the application for amendment of the written statement was filed on 25.7.2007 whereas the fact of striking off the name of the petitioner-Company was to their knowledge much prior to the moving of the aforesaid application. Not only this, in the said application for amendment, no such plea of being a direct tenant of applicant was taken. Even the appeal before the Appellate Authority, against the order of eviction of the Rent Controller was filed by the Company alone and in those grounds of appeal also, no such plea was taken. Even the order dated 22.9.2007 rejecting the amendment application was not challenged. Moreover, the applicant has not claimed direct tenancy on the basis of the agreement to sell dated 25.7.1999 in the grounds of appeal before the Appellate Authority. What was claimed was that the appeal was being filed in the name of the Company through Surinder Singh Gill and Saral Gill who have become the tenants of the premises and no eviction order can be passed against the Company which is not in existence. Mr. Palli has further refuted the argument that applicant-Saral Gill is not entitled to protect his possession in furtherance of Section 53-A of the Transfer of Property Act on the basis of agreement to sell dated 25.7.1999 as the said question cannot arise at all in the eviction proceedings. Mr. Palli has further argued that argument raised on behalf of the applicant is contrary to the facts on record as no defence was available to the petitioner as former Director on the date of filing of the written statement. Not only this, Mr. Palli further pointed out that no such argument was also raised before the Appellate Authority and thus, the CR No.4087 of 2010 17 revision petition is liable to be dismissed. Mr. Palli has also relied upon a judgment of the Hon'ble Supreme Court in Soni Dineshbhai Manilal and others versus Jagjivan Mulchand Chokshi (2007)13 SCC 293. Mr. Palli has further placed reliance on a judgment of this Court in the case of Sukhwant Singh versus Divisional Forest Officer and others 2010 (2) RCR (Civil) 394 to contend that a trespasser cannot protect his possession against a true owner.
I have heard learned counsel for the parties and perused the impugned orders and record of the case.
It is an admitted case of the parties that the respondent is the landlord of the demised premises whereas M/s Gilco Auto Engineers Pvt. Limited was inducted as a tenant vide registered lease deed dated 18.5.1984. It is also a matter of record that the petitioner-Company contested the petition by filing written statement. In spite of the fact that the striking off the name of the Company from the Register of Registrar of Companies was to the knowledge of the petitioner yet it was not pleaded in its written statement and the written statement was filed to contest the ejectment petition on behalf of the Company by Sh. Saral Gill as Managing Director of the said Company. The averments made in the written statement can be verified only on the basis of record and as per petitioner's own version, application under Section 560 of the Companies Act was filed much earlier and this fact was not pleaded in the written statement. The appeal before the Appellate Authority was also filed on behalf of the Company. Even before this Court this revision petition has been filed on behalf of the Company through Sh. Surinder Singh and Saral Gill as its former Directors.
It is also useful to refer to Section 560 of the Companies Act CR No.4087 of 2010 18 which reads thus:
560.Power of Registrar to strike defunct company off register.- (1) Where the Registrar has reasonable cause to believe that a company is not carrying on business or in operation, he shall send to the company by post a letter inquiring whether the company is carrying on business or in operation.
(2) If the Registrar does not within one month of sending the letter receive any answer thereto, he shall, within fourteen days after the expiry of the month, send to the company by post a registered letter referring to the first letter, and stating that no answer thereto has been received and that, if an answer is not received to the second letter within one month from the date thereof, a notice will be published in the Official Gazette with a view to striking the name of the company off the register.
(3) If the Registrar either receives an answer from the company to the effect that it is carrying on business or in operation, or does not within one month after sending the second letter receive any answer, he may publish in the Official Gazette, and send to the company by registered post, a notice that, at the expiration of three months from the date of that notice, the name of the company mentioned therein will, unless cause is shown to the contrary, be struck off the register and the company will be dissolved.
(4) If, in any case where a company is being wound up, the Registrar has reasonable cause to believe either that no liquidator is acting, or that the affairs of the company have been completely wound up, and any returns required to be made by the liquidator have not been made for a period of six consecutive months, the Registrar shall publish in the Official Gazette and send to the company or the liquidator, if any, a like notice as is provided in sub- section(3).
CR No.4087 of 2010 19(5) At the expiry of the time mentioned in the notice referred to in sub-section(3) or (4), the Registrar may, unless cause to the contrary is previously shown by the company, strike its name off the register, and shall publish notice thereof in the Official Gazette; and on the publication in the Official Gazette of this notice, the company shall stand dissolved.
Provided that-
(a) The liability, if any, of every director[x x x x] the manager or other officer who was exercising any power of management, and of every member of the company, shall continue and may be enforced as if the company had not been dissolved; and
(b) nothing in this sub-section shall affect the power of the [Tribunal] to wind up a company the name of which has been struck off the register.
(6) If a company, or any member or creditor thereof, feels aggrieved by the company having been struck off the register, the [Tribunal], on an application made by the company, member or creditor before the expiry of twenty years from the publication in the Official Gazette of the notice aforesaid, may, if satisfied that the company was, at the time of the striking off, carrying on business or in operation or otherwise that it is just that the company be restored to the register, order the name of the company to be restored to the register, and the [Tribunal] may, by the order, give such directions and make such provisions as seem just for placing the company and all other persons in the same position as nearly as may be as if the name of the company had not been struck off.
(7) Upon a certified copy of the order under sub-
section (6) being delivered to the Registrar for registration, the company shall be deemed to have continued in existence as if its name had not been CR No.4087 of 2010 20 struck off.
(8) A letter or notice to be sent under this section to a company may be addressed to the company at its registered office, or if no office has been registered, to the care of some director, [x x x x] the manager or other officer of the company, or if there is no director, [x x x x] manager or officer of the company whose name and address are known to the Registrar, may be sent to each of the persons who subscribed the memorandum, addressed to him at the address mentioned in the memorandum.
(9) A notice to be sent under this section to a liquidator may be addressed to the liquidator at his last known place of business."
A perusal of the proviso(a) of sub Section (5) of Section 560 shows that even after the name of a company is struck off from the register of Registrar of Companies yet for the purpose of appropriating assets and liabilities, the proceedings can be initiated in the name of the former Directors. Not only this, in the instant case when the proceedings were initiated, the petitioner-Company was very much in existence as its name was struck off from the register of Registrar of Company on a later date i.e. 16.12.2006. Thus, in view of the provisions of proviso(a) of section 560(5), no such argument is available to the petitioner. Moreover, when the petitioner-Company had filed the written statement on 27.9.2006, it had already moved an application for striking off its name from the register of Registrar of Companies but this fact was never disclosed and the petitioner-Company continued to pursue the ejectment application. Even before the Appellate Authority while filing the appeal, it was never disclosed as to in what capacity Surinder Singh and Saral Gill filed the appeal if the Company was not in existence and how the said appeal was competent CR No.4087 of 2010 21 without leave to appeal granted by the Court. Even before this Court also this petition has been filed on behalf of the Company by Surinder Singh and Saral Gill claiming themselves as former Directors of the Company without seeking any leave of the Court. The petitioner Company cannot be allowed to approbate and reprobate. Moreover, by virtue of Proviso (a) to Section 560(5) the Company can be sued through its former director for the purpose of appropriating the assets and liabilities of the Company. Thus, the plea which has been taken now at the time of final hearing is without any help to the petitioner.
The reliance of Sh. M.L.Sarin, learned Senior Advocate on a judgment of this Court reported as Anil Kumar versus Smt. Anguri Devi 2003(1) RCR 149 to contend that upon passing of an order of striking off the name of the Company from the Register of Registrar of Companies under Section 560 (5) of the Act, the Company had ceased to exist and thus, the petition filed against the petitioner-Company was not maintainable as the same was filed by the landlord-respondent against a dead person is misconceived, as the facts are entirely different and the said judgment is not applicable in the instant case. In the aforesaid case, the tenant- Company did not exist at the time when the ejectment petition was filed and the ejectment petition was filed after 12 years of the dissolution of the said Company on the ground that the said tenant-Company had sublet the premises in dispute. A finding was recorded in the aforesaid case that the landlords have failed to prove that the tenant had sublet the premises to the alleged sub-tenants. It was further found that the landlords had also failed to prove that the tenant-Company continued to be a tenant under the landlords after it had ceased to exist and stood dissolved by virtue of notification under Section 560(5) of the Act and in view of the aforesaid CR No.4087 of 2010 22 facts, it was found that once the tenant had ceased to exist and the landlord has failed to prove that tenant-Company continued to be a tenant after it ceased to exist, there was no question of subletting the property in dispute to the alleged sub-tenant and thus, in view of the aforesaid facts, it was held that the petition for ejectment against the tenant-Company which had ceased to exist 12 years prior to the filing of the ejectment petition, was not maintainable. The judgment in the case of Shrikishen Dhoot and Ors. vs. S.D. Kamlapurkur and Ors. 1965 (35) Com.Cas 913, relied upon by the learned counsel for the petitioner is again of no help to him as in the said case, the dispute was of recovery of amount from formal Directors for holding them individually responsible for the said amount and the argument raised on behalf of such Directors was that the remedy of the plaintiff was to apply under Section 560(6) for company being restored to the register, before he could maintain the suit or to apply for its restoration and to pray for its winding up and the Court held that the proviso to sub-section (5) of Section 247 which is pari materia of Section 560(5) of the Companies Act proceeds on the basis that the Company itself is dissolved and no longer is in existence and therefore, the suit against such Directors to hold them individually responsible for the amount in dispute held to be not maintainable. At this stage, it is relevant to point out that from the language of proviso (a) of Section 560(5) of the Act, it is clearly made out that after dissolution of the Company, the liability of every Director and member of the Company shall continue and may be enforced as if the company had not been dissolved.
It is also useful to refer to a Division Bench judgment Gauhati High Court in the case of Smt. Narmada Choudhary and others v. Motor Accident Claims Tribunal, Kamrup, Gauhati and others AIR 1984 CR No.4087 of 2010 23 Gauhati 16 which reads thus:
"The purport of proviso (a), in our opinion, is entirely different. It merely continues the liability of the officers including the Directors of the company existing, if any, on the date of its dissolution it does not convert the existing liability of the company on its dissolution into that of the officers named in the proviso. The liability of such officers contemplated under the proviso is their liability qua such officers which was existing on the date of dissolution. If the named officers had no liability, independent of the liability of the company on the date of its dissolution, the proviso does not come into play. In this case there was patently no liability of the petitioners as Directors on the date of dissolution of the company in the matter of discharge of debt arising against the company as a result of the award passed against the company. The award was passed against the company which was a separate juristic entity and the petitioners could not be said to incur thereunder any liability in their capacity as Directors of the company which could be enforced in terms of the said proviso. The proposition that the company is a separate juristic entity distinct from a share-holder or Director is so firmly established that it needs no elaboration. However, in this connection Mr. Choudhury has drawn our attention to a decision reported in AIR 1955 SC 74 (Bacha F. Guzedar v. Commr. Of Income-tax) and also to the provision of Section 543 of the Companies Act. The position canvassed before us, and rightly, in our opinion, is that the liability of a Director of the company in the course of conduct of the business of the company on account of misfeasance, if any, is investigated in the course of winding up of a company as manifested by the provisions of S.543. When such liability is determined then and then only the Directors can be proceeded against individually in their personal capacity; otherwise, CR No.4087 of 2010 24 for any debt due by the company they cannot be proceeded against by any creditor of the company in their individual capacity, either before or after its dissolution."
In the present case, admittedly, the petitioner-Company was tenant and it was its obligation to make payment of rent of the demised premises to the respondent-landlord and also to hand over the vacant possession to its owner.
So far as prayer of Saral Gill for impleading him as petitioner in this revision petition is concerned, the same is also without merit. In the application, Saral Gill is claiming himself a direct tenant and in the alternative as prospective buyer in possession of the demised property on the basis of agreement dated 25.7.1999. However, in spite of the fact that ejectment petition was contested on behalf of the Company by him as Managing Director and he was in the knowledge of agreement dated 25.7.1999, he never claimed direct tenancy or ownership of suit property as an individual by making an appropriate application for impleadment before the Rent Controller and further disputing the possession of the company over the demised premises as tenant and claiming its possession as direct tenant or prospective buyer as claimed now vide this application. Admittedly, the company's name was struck off on 16.12.2006 and amendment in the written statement was moved thereafter (which was denied vide order dated 22.9.2007) yet even at that stage, applicant-Saral Gill did not claim direct tenancy on the basis of clause 9 of the alleged Agreement dated 25.7.1999.
It may also be noticed at this stage that in the written statement filed on behalf of the company, a specific plea has been taken that landlord had received an amount of Rs.8,50,000/- as earnest money in CR No.4087 of 2010 25 furtherance of agreement dated 25.7.1999 from Saral Gill but refused to sell the property and returned the money but thereafter, an understanding was arrived between the parties to keep the aforesaid amount as advance rent and to adjust the interest of said amount as rent due. This plea itself clearly washes away the defence of direct tenancy and ownership of applicant Saral Gill. Moreover, there is not an iota of evidence to prove the aforesaid assertion of the tenant. Admittedly, applicant-Saral Gill has not claimed any relief for enforcement of agreement dated 25.7.1999, therefore, he cannot protect his possession over the suit property as a prospective buyer under Section 53-A of the Transfer of Property Act.
In view of the aforesaid discussion, the application of the Saral Gill to allow him to become a party in his individual capacity is without any merit and is rejected. So far as the status of applicant-Saral Gill as direct tenant on the basis of agreement to sell dated 25.7.1999 is concerned, the same cannot be considered as there was no pleadings before the Court on the basis of which any finding can be returned in this regard. From the facts as noticed above, applicant-Saral Gill can neither claim direct tenancy nor possession as prospective buyer on the basis of agreement dated 25.7.1999 and he is in possession of the demised premises on behalf of the petitioner-Company who was inducted as a tenant of the respondent- landlord.
There is no dispute with the judgment of the Hon'ble Supreme Court in the case of Rajesh Kumar Aggarwal and others v. K.K. Modi and others 2006(4) SCC 385 to the effect that the Courts should also take notice of subsequent events while adjudicating the question of amendment in the written statement, however, in the instant case, no fault can be found in the order dated 22.9.2007 of the Rent Controller whereby amendment CR No.4087 of 2010 26 application of the petitioner-Company was rejected. As in the case in hand, the petitioner-Company was in the knowledge of the very fact that they have already applied under Section 560(5) of the Companies Act for striking off the name of the company from the Register of Registrar of Companies and in spite of said fact to their knowledge, they did not disclose the same in their written statement. Not only this, the aforesaid order dated 22.9.2007 was never challenged by the petitioner and the same has attained finality. My aforesaid view finds support in the judgment of the Hon'ble Supreme Court in Soni Dineshbhai Manilal's case (supra).
Further on the basis of the judgment of the Hon'ble Supreme Court in Jai Prakash Gupta (D) thr. Lrs. Versus Riyaz Ahamad & Anr. 2007(2) RCR 475, counsel for the petitioner has further argued that in a petition for eviction on the ground of bona fide requirement, Court at any stage of proceedings can take into consideration subsequent events and mould. It is useful to refer to para 21 of the judgment which reads thus:
"In view of the discussions made hereinabove, it is therefore, a settled proposition of law that subsequent developments of fact or law which have a material bearing on the entitlement of the parties to relief or on aspects which bear on the moulding of the relief occur, the Court, even at any stage of the proceeding, is not precluded from taking a cautious cognizance of the subsequent developments of fact and law to mould the relief. Keeping these principles in mind and considering the nature of subsequent developments as brought out by the parties during the pendency of writ petition, we are of the view that we will have to find out a solution within the scope of this exception. Therefore, the test is whether the subsequent events of fact have a material bearing on the entitlement of the parties to relief or on aspects which bear on the moudling of the relief CR No.4087 of 2010 27 awarded before consideration of such subsequent events."
Keeping in view the aforesaid statement of law, it is suffice to say that the facts of the instant case are entirely different as in the cited judgment, the relief was claimed by the LRs of the landlord for granting appropriate relief against the tenant. Keeping in view the subsequent events, the judgment of the Hon'ble Supreme Court in the case of R. Kanthimathi and other versus Mrs. Beatrice Xavier 2001(3) PLR 587 is not tenable. In the instant case, alleged agreement to sell dated 25.7.1999 was executed between Saral Gill and respondent-landlord whereas admittedly, the petitioner-Company was tenant of the respondent- landlord. Whereas in the cited case, the agreement to sell was executed between the landlord and the tenant. Not only this, the aforesaid agreement to sell has not been proved in accordance with law. The judgment in the case of Shrimant Shamrao Suryavanshi and another v. Pralhad Bhairoba Suryavanshi (dead) by LRs. and others AIR 2002 SC 960, relied upon by the petitioners to contend that the appellant was entitled to defend his possession over the property is misconceived. The question before this Court is not arising out of the dispute between the parties on the basis of agreement to sell dated 25.7.1999 but in a simple ejectment application between a landlord and a respondent. The judgment in the case of Ram Janam Singh versus State of Uttar Pradesh and Anr. JT 1990(1) SC 187 is on different facts and is not applicable in the instant cases. The said judgment pertains to a suit in a service matter.
The contention of the learned counsel for the petitioner that after the Company has become defunct and there being no plea of petitioner a direct tenant or a prospective buyer still he is entitled to protect CR No.4087 of 2010 28 his possession as a trespasser, is noticed only to be rejected as it is well settled that a trespasser cannot seek protection against a true owner. The title of the respondent-landlord with regard to the demised premises is not disputed.
It may also be noticed that no argument has been raised on behalf of the petitioner with regard to the findings of the Courts below regarding non-payment of rent and bona fide necessity of the landlord. In fact, arguments have been advanced before this Court as discussed above.
In view of the aforesaid discussion, I find no merit in this petition.
Dismissed.
April 27, 2012 (RAKESH KUMAR GARG)
ps JUDGE
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