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MANU/SC/0067/1996 : AIR1996SC264 . The facts of the case were that an open space, was in the possession of Esso company pursuant to a lease dated 17.7.1969 granted by the appellant. Esso company was merged into respondent corporation on 14.3.197. The appellant filed eviction petition under section 21(1)(f) of the Karnataka Rent Control on the ground of sub-letting, assignment parting with possession . The courts below dismissed the application on the ground that the Esso company had not sub-set the demised premises but by virtue of statutory provisions under the Esso Act, the respondent-corporation stood transposed as a tenant which is an involuntary act pursuant to section 7 of the Act and notwithstanding the specific embargo created under Section 21(1)(f) of the Act, it cannot be construed to be a case of sub- letting. The High Court also reached the same conclusion. In appeal Supreme Court upheld the order of the High Court and took note of section 5(1) of the Esso Act and observed that pre-existing tenancy rights held by Esso company with the appellant initially stood transferred and vested in the Central Government, and thereafter, by operation of section 7 of the Esso Act; the said rights in turn stood transposed and vested in the government company as if the government company initially became the tenant of the appellant- landlord. On the Esso Act coming into force, by operation of sections 5 and 7 of that Act, the respondent corporation became statutory tenant and thereby it cannot be construed to be an assignment of tenancy rights, which the appellant landlord had entered into with the Esso company. The ratio of Parasram Harnand Rao (supra) was distinguished with the observation that in that case the Official Liquidator had sold the tenancy rights in favor of the respondents and though the same was made in favor of the respondent through court, it amounted to transfer of an interest by the tenant.

10. It will thus be seen that consistent view of the Supreme court has been that take over of a company by the Central Government under a statute stands on a different footing then merger of two companies under the provisions of companies Act. Vesting of tenancy rights in the Central Government or a Government company by virtue of the provisions of the statute was upheld by the apex court in the case of HPCL case (supra) and this decision was cited with approval in the case of Singer India Ltd. (Supra). Whereas in cases of later category i.e transfer of tenancy rights under an scheme of amalgamation under provisions of company Act has been consistently held to be sub letting, assignment or parting with possession, in cases falling in the former category viz. where tenancy rights of one company are taken over by the Government and are conferred on some other government company under a statute have never been held to tantamount to sub letting, assignment or parting with possession. The case in hand falls in this category. As already noticed leasehold rights on PNB have been conferred by clause 4 (2) of the notification dated 4.9.93 issued under section 9 of the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1980 which scheme is legislative in character. It cannot fall in the category of any voluntary or involuntary transfer of interest by the tenant. Therefore, it does not amount to sub-letting assignment or parting with possession of tenancy rights by the tenant. The impugned order passed by the learned Tribunal Therefore does not call for any interference." 7 In the case of Allahabad Bank (supra) the facts were identical; this was a merger between a private bank with a Government bank; private bank being the United Indian Bank and the Government bank being the PNB. In this context, the Division Bench of this Court has noted as under:-