w w w . L a w y e r S e r v i c e s . i n



Anilkumar Vaikuthlal Patel v/s O.L. of A'bad Jubili Spinning & Mfg. Mills Co. & Others


Company & Directors' Information:- K K P SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1993PTC004731

Company & Directors' Information:- N R U SPINNING MILLS LIMITED [Active] CIN = U17111TZ1994PLC005591

Company & Directors' Information:- R G SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ2004PTC011274

Company & Directors' Information:- J P P MILLS PRIVATE LIMITED [Active] CIN = U17111TZ2003PTC010491

Company & Directors' Information:- P K P N SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1981PTC001034

Company & Directors' Information:- K R V SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1990PTC002716

Company & Directors' Information:- V R SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1979PTC000836

Company & Directors' Information:- K A S SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17111TZ1990PTC002955

Company & Directors' Information:- V M D MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1994PTC004822

Company & Directors' Information:- P S G SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1994PTC005234

Company & Directors' Information:- A R C MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1994PTC004845

Company & Directors' Information:- C P SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1994PTC005257

Company & Directors' Information:- S AND Y MILLS LIMITED [Not available for efiling] CIN = U17111TZ1994PLC005460

Company & Directors' Information:- D C MILLS PRIVATE LIMITED [Active] CIN = U25199KL1996PTC009988

Company & Directors' Information:- N S C SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ2004PTC011093

Company & Directors' Information:- R A MILLS PRIVATE LIMITED [Active] CIN = U17111TZ2006PTC013248

Company & Directors' Information:- K T SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1990PTC002678

Company & Directors' Information:- J G SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1991PTC011033

Company & Directors' Information:- S P SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1979PTC000862

Company & Directors' Information:- J G SPINNING MILLS PRIVATE LIMITED [Not available for efiling] CIN = U18101WB1991PTC050845

Company & Directors' Information:- M B S SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1994PTC005005

Company & Directors' Information:- R D SPINNING MILLS LIMITED [Active] CIN = U17115PB1989PLC009763

Company & Directors' Information:- J M MILLS PRIVATE LIMITED [Active] CIN = U17111TZ2006PTC013113

Company & Directors' Information:- T K S SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1988PTC002117

Company & Directors' Information:- K P M SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1995PTC006011

Company & Directors' Information:- M T A MILLS PRIVATE LIMITED [Active] CIN = U17115TZ1989PTC003048

Company & Directors' Information:- J. C. SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17121TG2011PTC073799

Company & Directors' Information:- P A MILLS INDIA LTD. [Not available for efiling] CIN = U17111TN1990PLC019762

Company & Directors' Information:- R R R SPINNING MILLS INDIA PRIVATE LIMITED [Active] CIN = U17111TZ1990PTC002745

Company & Directors' Information:- K N M MILLS PRIVATE LIMITED [Active] CIN = U17115TZ1990PTC002702

Company & Directors' Information:- G P M SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17110PB2005PTC028070

Company & Directors' Information:- R R SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17111TZ1980PTC000984

Company & Directors' Information:- B B S M SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17111TZ1990PTC002914

Company & Directors' Information:- J R K MFG PRIVATE LIMITED [Active] CIN = U18204WB2015PTC205141

Company & Directors' Information:- P A SPINNING MILLS PVT. LTD. [Not available for efiling] CIN = U17111TN1989PTC018288

Company & Directors' Information:- V M MILLS PRIVATE LIMITED [Active] CIN = U17111TZ2005PTC011763

Company & Directors' Information:- M K G SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17115TZ1990PTC002952

Company & Directors' Information:- PATEL MILLS COMPANY LIMITED [Under Liquidation] CIN = L17119GJ1925PLC000063

Company & Directors' Information:- M S SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17219PB1995PTC017064

Company & Directors' Information:- N G SPINNING MILLS PVT LTD [Active] CIN = U21010GJ1981PTC004505

Company & Directors' Information:- A A K. SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17111TZ1995PTC005766

Company & Directors' Information:- S. S. MILLS PRIVATE LIMITED [Active] CIN = U24231GJ1988PTC010885

Company & Directors' Information:- G M MILLS PRIVATE LIMITED [Active] CIN = U51900MH1999PTC122189

Company & Directors' Information:- G P G SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17111TN1987PTC014844

Company & Directors' Information:- E A P SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17111TZ2005PTC011782

Company & Directors' Information:- N S K SPINNING MILLS PRIVATE LIMITED [Under Process of Striking Off] CIN = U17111TZ1994PTC004816

Company & Directors' Information:- R B MILLS PVT LTD [Active] CIN = U15141AS1949PTC001939

Company & Directors' Information:- R. A. SPINNING MILLS PVT LTD [Strike Off] CIN = U17115PB1988PTC008852

Company & Directors' Information:- K P K SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17111TZ1961PTC000431

Company & Directors' Information:- H K SPINNING MILLS PVT LTD [Active] CIN = U17111PB1986PTC006672

Company & Directors' Information:- A V S SPINNING MILLS INDIA PRIVATE LIMITED [Strike Off] CIN = U17111TZ2004PTC011275

Company & Directors' Information:- K S SPINNING MILLS PRIVATE LIMITED [Active] CIN = U17299HR2021PTC092277

Company & Directors' Information:- O P K SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17120DL1988PTC032165

Company & Directors' Information:- P N M SPINNING MILLS PVT LTD [Strike Off] CIN = U17111TN1981PTC008870

Company & Directors' Information:- J K K SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17111TZ1981PTC001085

Company & Directors' Information:- R K SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17100KA1995PTC018864

Company & Directors' Information:- B T MILLS PRIVATE LIMITED [Active] CIN = U18101MH1997PTC109479

Company & Directors' Information:- T R MILLS PRIVATE LIMITED [Active] CIN = U17111KA1954PTC000799

Company & Directors' Information:- J K MILLS LTD [Strike Off] CIN = U17200WB1946PLC013603

Company & Directors' Information:- G M MILLS PRIVATE LIMITED [Amalgamated] CIN = U18101MH2003PTC138487

Company & Directors' Information:- J K R SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17111TZ1995PTC006781

Company & Directors' Information:- PATEL SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17111GJ1999PTC036175

Company & Directors' Information:- P. D. R. SPINNING MILLS PRIVATE LIMITED [Strike Off] CIN = U17112AP2006PTC052124

Company & Directors' Information:- PATEL MILLS COMPANY LIMITED [Not available for efiling] CIN = U99999MH1925PTC001215

    R. O.J. Appeal No. 1 of 2003 In R. Company Application No. 16 of 1999 with Civil Application (OJ) Nos. 1 to 4 of 2016 [Original Civil Application (OJ) No. 358 of 2016]

    Decided On, 26 March 2020

    At, High Court of Gujarat At Ahmedabad

    By, THE HONOURABLE MS. JUSTICE HARSHA DEVANI & THE HONOURABLE MR. JUSTICE A.S. SUPEHIA

    For the Appellant: Megha Jani with M.I. Hava (348), Chanakya Bhavsar (6316), Advocates. For the Opponents: Kamal Trivedi, Advocate General with Jeet J. Bhatt with R.C. Mishra Official Liquidator (6154), Pranav G. Desai (290), Advocate.



Judgment Text


Cav Judgment:

Harsha Devani, J.

1. These matters were earlier heard by this Bench and vide order dated 4.4.2017, the court had posted the matter for dictation of judgment on 17.4.2017. On 16.2.2018, this court passed the following order:-

"1. This matter had been heard at length in March/April,2017 and after arguments were concluded, the matter was posted for dictation of judgment on 17.4.2017. On that day it was not possible to dictate the judgment in view of the regular board as well as the fact that simultaneously, while this matter was being heard, the court was also hearing voluminous criminal appeals in one of the biggest riot cases arising out of the massacres that took place in the aftermath of the burning of a coach of the Sabarmati Express, during the second session on a day to day basis, in view thereof, it was not possible to deliver the judgment in this case. The summer vacation commenced on 6th May, 2017 and with effect from 5th June, 2017 there was a change in the roster whereupon the criminal appeals were heard for the whole day. Considering the volume of the evidence involved in the matter, the hearing continued till mid August and since the facts were fresh in the mind of the court, the first priority was to complete the judgment in that case. In October, 2017 there was a change in the roster and the bench was assigned taxation matters and unfortunately, one of the members of the bench was incapacitated due to ill health for a considerable period from October, 2017 to January, 2018 and hence, it was not possible to complete the dictation of the judgment in the matter. On 14th February, 2018, one Mr. Amar N. Barot, General Secretary of the Textile Labour Association made a mention before the court that the judgment in the case may either be dictated or the matter may be released and sent to the regular bench.

2. It may be noted that the record of this appeal is also quite voluminous and as referred to earlier, the hearing went on for several days. The court has minutely recorded the submissions of the learned counsel for the parties and the learned counsel for the parties have also submitted written submissions and hence, despite the delay, there was no difficulty on the part of the court in dictating the judgment. The matters were posted for dictation of judgment today, that is, on 16th February, 2018.

3. When the matters were called out for dictation, Mr. D.S. Vasavada, learned advocate for the Textile Labour Association, expressed reservations about the court dictating the judgment and vehemently submitted that the matter be released and be sent before the regular bench. The reason put forth for making such request is that in the intervening period, that is, from the time when the matter was heard, till the matter came to be listed for dictation, several workers have passed away and further that several matters have been remanded by the Supreme Court and in view of the pendency of this matter, the learned advocate for the appellants has been requesting the concerned Benches not to take up the matter on the ground that similar issues are involved in this case. Though there was strong objection to such request by Mr. M.I. Hava, learned advocate for the appellant, the learned advocate for the Textile Labour Association was insistent that the matter be released. What was more perturbing was that the learned counsel for the Official Liquidator also quite vocally supported such request. It may be noted that except for the two grounds stated hereinabove, the learned counsel have not voiced any other objection to the court proceeding further and delivering the judgment in this case.

4. On the other hand, Mr. M. I. Hava, learned advocate for the appellant, strongly objected to the request made by the learned counsel for the respondents and submitted that when the court has heard the matter at length and is ready to proceed with the dictation of the judgment, such request should not be accepted. It has further been submitted that no written application has been filed on affidavit giving details about the number of workers who have passed away nor has any request been made by the learned counsel for the respondents in the interregnum and that the request made by the learned counsel for the respondents is not a bona fide one, inasmuch as, even if another Bench takes up the matter for hearing, it is not likely to be decided at an early date.

5. Having considered the request of the learned advocates for the respondents, viz. the Textile Workers Union and the Official Liquidator, the court is of the view that it cannot be disputed that there has been some delay in dictating the judgment after the matter was heard in the month of April, 2017. Considering the first ground put forth by the learned counsel for the respondents, it is difficult to understand as to how not proceeding with the judgment would in any way serve the interest of the workers inasmuch as the regular Bench would have to rehear the matter and decide the same which would again consume some time. Insofar as the second ground, namely because of the pendency of this matter, the other cases which have been remanded by the Supreme Court are not being decided, is concerned, it may be pertinent to note that the Supreme Court while remanding the matters has observed thus:

"24. Though we have affirmed the order dated 17- 10- 2008 of the Gujarat High Court passed in Jabal C. Lashkari v. Official Liquidator and dismissed the civil appeals arising out of SLPs (C) Nos. 29282-84 of 2008 (Jabal C. Lashkari v. Official Liquidator), our decision to affirm the said judgment of the High Court is based on a consideration of the specific clauses in the lease deed between the parties to the case. What would be the effect of the principles of law underlying the present order vis-a-vis the specific clauses of the lease deed between the parties in the other cases is a question that has to be considered by the High Court in each of the cases. That apart, whether the order dated 17-7- 2006 passed in State of Gujarat v. Official Liquidator has attained finality in law and forecloses the question raised and further whether constructions have been raised on such land by the State Government for the benefit of the general public, as has been submitted to dissuade us from interfering with the order of the High Court, are questions that would require a full and complete consideration by the High Court on the materials available. To enable the said exercise to be duly performed, we set aside the orders of the High Court impugned in each of the aforesaid civil appeals and remit all the matters to the High Court for a fresh consideration in accordance with the observations and principles of law contained in the present order."

Thus, each case that has been remanded has to be decided by the High Court by considering the specific clauses of the lease deed between the parties in the respective cases, which certainly would not be identically worded. Moreover, the facts involved in this case are peculiar to it, inasmuch as after the initial lease deed came to be executed, there has been two subsequent transfers by the concerned lessees, one by a registered deed and another (in favour of the company in liquidation) by an unregistered deed. Therefore, the pendency of this judgment would have no effect on the other matters which are pending before the court as each matter has to be decided on the basis of the recitals contained in the individual lease deeds. The learned counsel for the appellants therefore, does not appear to be justified in seeking adjournments in other cases on the ground of pendency of this case. Thus, no valid ground has been made out for releasing the matter at the stage of judgment. However, considering the manner and the vehemence with which the request for releasing the matter is concerned, it appears that there is more to it than meets the eye, and indirectly, the learned counsel as well as his client Mr. Amar N. Barot, General Secretary appear to have expressed lack of faith in this Bench. Under these circumstances, the court would be reluctant to proceed further and impose a judgment on parties who have reservations about justice being done in the matter and therefore, deems it fit to release the matter.

6. In view of the above, despite having heard the matter at length, instead of proceeding with the dictation of the judgment, with regret the court is constrained to release the matter. Let the appeal be listed before the regular Bench.

7. At this stage, Mr. M.I. Hava, learned counsel for the appellant, requested the court to stay the operation of this order for a period of two weeks to enable the appellant to approach the higher forum. Considering the nature of the order that has been passed, the request is declined."

2. The applicant herein challenged the said order before the Supreme Court in Civil Appeal No.9939 of 2018, wherein the following order came to be passed on 25.9.2018 :-

"1. Leave granted.

2. We have heard the learned counsels for the parties.

3. Having considered the matter we are of the view that the Hon'ble Judges who have passed the impugned order and recused themselves from hearing should hear and decide the matter at the earliest. We order accordingly.

4. We are told at the Bar that the Hon'ble Judges have already heard the matter and the same has been reserved for pronouncement.

5. If the Hon'ble Judges feel the necessity of further hearing, such further hearing will also be undertaken. We further record that in the facts of the case we do not consider it necessary or prudent to record our reasons for the view taken.

6. Consequently, and in the light of the above, the order of the High Court is set aside and the appeal is allowed in the above terms."

3. Since a considerable time had elapsed since the matter was earlier heard, the Bench was required to hear the matter once again, accordingly the learned counsel for the respective parties were heard at length once again.

4. This case has a chequered history. The applicants herein filed a Judges' Summons being Company Application No.16 of 1999 in Company Petition No.139 of 1988, wherein the applicant sought the following reliefs:-

"(A) to direct the Official Liquidator of the Ahmedabad Jubilee Spinning and Manufacturing Mills Company Limited (in liquidation) to handover peaceful and vacant possession of the lands bearing survey No.53 admeasuring 4 acres 16 gunthas and survey No.55 admeasuring 0 acres 15 gunthas of village Dariapur - Kazipur of Town Planning Scheme No.14 bearing final plot No.41 District and Sub district Ahmedabad to the applicant;

(B) to direct the Official Liquidator to pay the arrears of rent/ mesne profits, arrears of land revenue, municipal taxes, etc. that may be found to be due in accordance with the lease deed dated 11/03/1911 read with the sale deed dated 11/03/1964;

(C) to restrain by an order and injunction application the Official Liquidator, his agents/ assignees from transferring selling, alienating or dealing with in any manner whatsoever the lands bearing survey No.53 admeasuring 4 acres 16 gunthas and survey No.55 admeasuring 0 acres 15 gunthas of Town Planning Scheme No.41 bearing final plot No.41 District and Sub district Ahmedabad;

(D) to provide for the cost of this Application;

(E) to grant such other and further reliefs as this Hon'ble Court may deem fit and proper in the facts and circumstances of the case."

5. In support of the Judges' Summon, the applicant filed an affidavit dated 26.1.1999, wherein it was inter alia submitted that the applicant is the owner of the lands bearing Survey No.53 admeasuring 4 acres and 16 gunthas and Survey No.55 admeasuring 0 acres and 15 gunthas of village Dariapur Kazipur of Town Planning Scheme No.14 bearing Final Plot No.41 District and Sub district Ahmedabad (hereinafter referred to as the "subject property"). It is further averred that the subject property was for the first time leased to Ahmedabad Jubilee Spinning and Manufacturing Mills Company Limited (hereinafter referred to as "the Ahmedabad Manufacturing Company") by Surajben Patel, widow of Motilal Maganlal and Smt. Rukhmaniben Patel, daughter of Shri Motilal Maganlal Patel (hereinafter referred to as "the lessors") pursuant to a registered lease deed dated 4.8.1911. It is further averred that Rukhmaniben Patel, one of the two lessors, by her last Will and testament dated 22.4.1937 provided therein with respect to the property in paragraph 2 thereof that Shri Vaikunthlal Narandas (the son of the younger brother of her husband) on her death would become the owner of the property. The said Will was registered on 2.4.1937. Rukhmaniben Patel passed away on 28.12.1956 and Surajben predeceased Rukhmaniben. As per will dated 17.4.1937, the property came in the hands of Vaikunthlal Narandas Patel who transferred the property by way of a registered sale deed dated 21.1.1958 in favour of Smt. Kamlaben Patel, daughter of Jamnadas Haribhai together with all the rights of the lessors under the registered lease deed dated 4.8.1911 and its rights thereunder and also the Will dated 17.4.1937. Smt. Kamlaben Patel by a further registered deed dated 11.3.1964, transferred the subject property by sale thereof in favour of the lessors under the registered lease deed dated 4.8.1911 and her rights under the registered deed dated 21.1.1958. As the applicant Smt. Sadgunaben Vaikunthlal Patel became old and weak in health, a power of attorney dated 29.6.1998 came to be executed in favour of Shri Anilkumar Vaikunthlal Patel, who is the son of Smt. Sadgunaben Vaikunthlal Patel. Thereafter the power of attorney, Smt. Anilkumar Vaikunthlal Patel, upon inquiry, learnt that the company had committed various breaches and violated the terms and conditions of the lease deed dated 4.8.1911 and had failed to pay the rent/mesne profit/ land revenue, etc. since 1989-90 to the applicant Smt. Sadgunaben Vaikunthlal Patel, who, therefore, became entitled to recover the possession of the property. It is further averred that the applicant (power of attorney Shri Anilkumar Vaikunthlal Patel) further learnt that the company had closed down its manufacturing activities and was unable to run its business and ultimately, by an order dated 5.9.1989 passed in Company Petition No.139 of 1988, this court ordered the company to be wound up and the first respondent was appointed as liquidator of the company and has taken over the possession of the company including the subject property. It is further averred that to the knowledge of the applicant the first respondent has sold the movables of the company and that the company cannot now carry on its activities in any manner whatsoever.

5.1 It is further averred that in respect of the subject property, the first respondent - Official Liquidator of the Ahmedabad Jubilee Spinning & Manufacturing Mills Company Limited ( in Liquidation), was in the process of commencing sale thereof by inviting offers, etc. It is the case of the applicant that the first respondent does not require in any manner the subject property for the purpose of winding up the company and that if the first respondent is permitted to sell, alienate, transfer or otherwise deal with the property and/ or is permitted to create third party interest therein, the applicant's right to the property would be severely jeopardised and the applicant would suffer grave and irreparable loss which cannot be compensated in terms of money.

5.2 It is further averred that the first respondent, after taking over the possession of the subject property pursuant to the orders of this court has failed and neglected to pay the amount of nominal rent of Rs.500/- per annum as contemplated under the lease deed dated 4.8.1911. Moreover, to the knowledge of the applicant, the company or the first respondent has not made payment towards local taxes, cesses, etc. required to be paid under the original lease deed dated 4.8.1911 read with the subsequent registered transfer deeds. Along with the application, the applicant has also annexed the documents referred to hereinabove.

6. Company Application No.16 of 1999 came to be decided by a common judgment and order dated 30.7.2002 passed by the learned Company Judge, whereby it was held as follows:-

"40. To summarise:

[a] Leasehold interest is an intangible asset, which is valuable in nature though the valuation may differ from case to case depending upon the unexpired period of lease.

[b] Such an asset is transferable subject to the same terms and conditions as may be stipulated in the lease deed.

[c] Once there is a contract which has not been determined, the relationship of the parties to the contract continues to subsist till the period for which the contract is in existence subject to an express condition to the contrary.

[d] There is a distinction between the point of time when an order of winding up is made and at the point of time when an order of dissolution is made, the company continues to exist between the two terminii.

[e] A condition in the lease deed permitting a lessee to give back the possession as and when the lessee chooses to do so cannot be converted into an obligation entitling the lessor to seek possession.

[f] A condition in the lease deed by way of requirement to pay rent, per se, does not create an onerous covenant, once readiness and willingness is shown by the lessee, or on its behalf, to discharge such obligation.

41. In light of what is stated hereinbefore, it is not possible to accept the case of the applicants. The possession of the land in question cannot be directed to be handed over to the applicant landlords for the various reasons stated hereinbefore. The applications are therefore rejected. There shall be no order as to costs."

7. Being aggrieved, the applicant preferred appeal being O.J. Appeal No.1 of 2003 under section 483 of the Companies Act, 1956 (hereinafter referred to as "the Companies Act") before a Division Bench of this court. By a judgment and order dated 23.10.2008, the Division Bench, following its earlier judgment dated 17.10.2008 passed in O.J. Appeals No.65 to 67 of 2006 dismissed the appeal, subject to the clarification that the secured creditors will provide necessary finance for payment of rent by the Official Liquidator to the lessors of the property in question, in case, the Official Liquidator is not having the adequate funds for payment of such rent to the lessors.

8. The applicant challenged the above order of the Division Bench before the Supreme Court, which by a common judgment and order dated 29.3.2016 passed in the case of Jabal C. Lashkari and others v. Official Liquidator and others, inter alia held thus:-

"20. The mere fact that the company has been ordered to be wound up cannot be a ground to direct the official liquidator to handover possession of the land to the owners inasmuch as the company in liquidation continues to maintain its corporate existence until it stand dissolved upon completion of the liquidation proceedings in the manner contemplated by the Companies Act. In the present case it has been repeatedly submitted before this Court by both sides that presently revival of Prasad Mills is a live issue pending before the Gujarat High Court, a fact which cannot be ignored by this Court in deciding the above issue against the appellant.

21. For the aforesaid reasons we affirm the order of the High Court dated 17.10.2008 in O.J. Appeal Nos. 65 of 2006, 66 of 2006 and 67 of 2006 and dismiss the civil appeals arising out of SLP(C) Nos.29282-29284 of 2008 wherein the said order is under challenge.

22. The other civil appeals, which have been heard analogously, can be divided into two categories. The first is where the order dated 17.10.2008 passed in O.J. Appeal No.65 of 2006 [Jabal C. Lashkari & Ors. v. Official Liquidator & Ors.] impugned in civil appeals arising out of SLP(C) Nos.29282-29284 of 2008 has been followed. In the other group are the cases where the said order has been followed and also an additional ground has been cited namely that in view of the order dated 17.07.2006 passed in Company Application No.250 of 2006 a direction has been issued to handover possession of the leased premises to the State Government; hence the question of putting the property to sale does not arise.

23. Though we have affirmed the order dated 17.10.2008 of the Gujarat High Court passed in O.J. Appeal Nos.65 of 2006, 66 of 2006 and 67 of 2006 and dismissed the civil appeal arising out of SLP(C) Nos.29282-29284 of 2008 [Jabal C. Lashkari & Ors. v. Official Liquidator & Ors.] our decision to affirm the said judgment of the High Court is based on a consideration of the specific clauses in the lease deed between the parties to the case. What would be the effect of the principles of law underlying the present order vis--vis the specific clauses of the lease deed between the parties in the other cases is a question that has to be considered by the High Court in each of the cases. That apart whether the order dated 17.07.2006 passed in Company Application No.250 of 2006 has attained finality in law and forecloses the question raised and further whether constructions have been raised on such land by the State Government for the benefit of the general public, as has been submitted to dissuade us from interfering with the order of the High Court, are questions that would require a full and complete consideration by the High Court on the materials available. To enable the said exercise to be duly performed, we set aside the order of the High Court impugned in each of the aforesaid civil appeals and remit all the matters to the High Court for a fresh consideration in accordance with the observations and principles of law contained in the present order."

9. Thus, what is set aside by the Supreme Court is the order of the High Court impugned in each of the civil appeals and matters are remitted to the High Court for a fresh consideration in accordance with the observations and principles of law contained in the said order. The appeals against the order passed by the learned Company Judge, therefore, do not survive. Ideally, therefore, this matter should have been heard and decided by the learned Company Judge in view of the fact that the Supreme Court had set aside the decision of the High Court and remanded the matter for fresh consideration in accordance with law. What was subject matter of appeal before the Supreme Court were the orders passed by the Division Bench of the High Court affirming the order passed by the learned Company Judge. Therefore, in effect and substance, the order passed by the learned Company Judge also stands set aside. Consequently, the applications have to be heard afresh. However, a coordinate Bench had passed the following order on 1.8.2016:-

"1. Shri Vasavada, learned Counsel appearing on behalf of the workmen urged in the morning at the time of mentioning that in this group of matters, the original proceedings date back to 1989 and 1999 and the workmen have not received complete fruits of the litigation. He, therefore, urged for priority in the matters as the Supreme Court has remanded the matter only on limited aspect.

2. Shri Desai also joins the request for atleast fixing the matters on some date on which the matters may go ahead so that all the concerned Counsel those who are appearing in the matter or would be appearing in the matter may have adequate notice of the date on which the matters are to be taken up.

3. Learned Counsel Shri Hawa, who appears in OJ Appeal No.60 of 2003 and OJ Appeal No.1 of 2003 urged that in fact, these matters should have been relegated to the learned Company Judge as the Supreme Court has ordered that the matters be decided afresh. In support of his submission, he relies upon order of this Court in LPA No.1142 of 2004 dated 15.01.2007.

4. We are of considered view that Shri Hawa's submission cannot be accepted by this Court in view of unequivocal order of the Supreme Court in which the matters are remanded and the challenge in the Supreme Court was arising from the order passed by the appellate Bench in OJ Appeals. In that view of the matter, the order of remand need to be understood as if it is remanded to the Court in the proceedings of OJ Appeals only. Hence, we are unable to accept the submission advanced on behalf learned Counsel Shri Hawa.

5. In view of the plight narrated on behalf of the workmen, we are also unable to adjourn the matters for longer period as prayed for by Shri Hawa on behalf of his clients. We are, however, of the view that let these matters be fixed on a date, of which other Advocates appearing may have knowledge. Hence, we are keeping these matters on 09.08.2016 at 02.30 pm. Copy of this order be placed in each of the matters so that by all concerned, appropriate note of the fact be taken that the matters are going to be peremptorily heard on 09.08.2016 at 02.30 pm.

6. For time being, all the matters be placed and in the matters which are not urgent, we may pass appropriate orders for separating the same.

7. Office is directed to list the matters in a separate Board at 02.30 pm."

9. Subsequently, the applicant herein as heir and legal representative of the original applicant Smt. Sadgunaben Vaikunthlal Patel filed a Judges Summons being O.J. Civil Application No.358 of 2016 in Company Application No.16 of 1999 seeking the following reliefs:-

"(A) To delete the Official Liquidator of the Ahmedabad Jubilee Spinning and Manufacturing Company Limited and in place thereof to substitute the name of the Official Liquidator of the Ahmedabad Jubilee Mills Limited (in liquidation).

(B) To implead the Official Liquidator of Ahmedabad Manufacturing and Calico Printing Company Limited (in liquidation) as party in the proceedings herein.

(C) To direct the O.L. Of Ahmedabad Jubilee Mills Ltd. to handover peaceful and vacant possession of the lands bearing Survey No.53 admeasuring 4 Acres 16 Gunthas and Survey No.55 admeasuring 0 Acres 16 Gunthas of Village Dariapur-Kazipur of Town Planning Scheme No.14 bearing Final Plot No.41, Dist. and Sub-Dist. Ahmedabad to the Applicant.

(D) To direct the O.L. Of Ahmedabad Jubilee Mills Ltd. to pay the arrears of rent/mesne profits, arrears of land revenue, municipal taxes amounting to Rs.14.11 Crore etc. that may be found to be due;

(E) To provide for the cost of this Application.

(F) To pass such other order or orders as in the interest of justice this Hon'ble courts may deem fit and proper."

10. In support of the Judges' summons, the applicant filed an affidavit wherein he has stated that his grandmother Smt. Sadgunaben Vaikunthlal Patel had filed Company Application No.16 of 1999 and has further referred to the prayers made in the said application. It is further stated that by registered lease deed dated 4.8.1911 executed by his predecessor-in-title in favour of Ahmedabad Jubilee Spinning and Manufacturing Company Limited, land bearing Survey No.53 admeasuring 4 acres 35 gunthas and Survey No.55 admeasuring 0.15 gunthas of T.P. Scheme No.14 (Shahibaug), Final Plot No.41, Moje- Dariapur-Kazipur, City Ahmedabad was leased on the terms and conditions contained therein. By virtue of interim orders, the Company Judge had directed the Official Liquidator to file a report in response to the Application No.16/99 and 58/99 vis-- vis the stand taken by the secured creditors of both the companies. Pursuant to the said direction, no affidavit was filed by any of the secured creditors of both the companies.

However, from the statement of affairs filed by ex-Directors of Ahmedabad Jubilee Mills Limited on 17.11.1990, it was noticed that there were only three secured creditors, namely, Bank of India, State Bank of India and Punjab National Bank and the subject property of the applicant was not charged, mortgaged or in any manner secured by the said Ahmedabad Jubilee Mills Ltd.

10.1 It is further averred that from the report submitted by the Official Liquidator in Company Application No.16 of 1999, it was noticed that there was some discrepancy in the name of the company and, therefore, upon a proper search being taken, it was found that by a registered sale deed of movable assets and assignment of leasehold rights dated 29.3.1941, executed by Ahmedabad Jubilee Spinning and Manufacturing Company Limited, all assets, plants, machinery, all movable and immovable properties including leasehold rights in the subject property were assigned, sold and transferred for the consideration stated therein in favour of Ahmedabad Manufacturing and Calico Printing Company Limited (hereinafter referred to as "Calico Limited.").

10.2 It is stated that in view thereof, Calico Limited became the assignee of the leasehold rights of the subject property. Calico Limited went in liquidation, and by an order of this court dated 15.7.1998 passed in Company Application No. 157 of 1995, the Official Liquidator of this court was appointed as liquidator of Calico Limited. Therefore, it had become necessary to join the Official Liquidator of Ahmedabad Manufacturing and Calico Printing Company Limited as party respondent in these proceedings so that the orders that may be passed in these proceedings can be effectively executed and implemented.

10.3 As regards prayer for substituting the Official Liquidator of Ahmedabad Jubilee Mills Limited in place of Ahmedabad Jubilee Spinning and Manufacturing Company Limited, it was submitted that Ahmedabad Manufacturing after selling its assets to Calico Limited had become a defunct company and dissolved. The Official Liquidator had pointed out that no company known as Ahmedabad Jubilee Spinning and Manufacturing Company Limited is in existence. It is further averred that there was some litigation by secured creditors of Calico Limited in respect of ownership of movable and immovable properties of the companies as is evident from the judgment of this court in the matter of Civil Application No.302 of 1999 filed by ICICI Limited against the Official Liquidator of Ahmedabad Manufacturing and Calico Printing Company Limited reported in 2001 JX GUJ 92. It was further noticed that on 28.12.1982, a company known as Gaurav Chemtax Industries Limited (hereinafter also referred to as "Gaurav Chemtex") was incorporated and it was a wholly owned subsidiary of Calico Limited. It is further averred that it appears that Calico Limited by an unregistered agreement dated 24.6.1983 entered into with Gaurav Chemtex Industries Limited, transferred the undertaking, business and operation of its Division known as "Jubilee Mill Unit" to Gaurav Chemtex Industries and subsequently, it was renamed as Ahmedabad Jubilee Mills Limited. It is pointed out that ICICI Bank preferred an appeal against the said judgment which came to be withdrawn. It is further averred that the Ahmedabad Jubilee Mills Limited being in possession of the subject property became tenant of the applicant under the provisions of the Gujarat Rent Act. The yearly rent of Rs.500/- was paid till 1995 by Calico Limited for and on behalf of the tenant. The tenant, that is, Ahmedabad Jubilee Mills Limited closed its operation in 1987 by the order dated 5.9.1989 of this court passed in Company Petition No.139 of 1988, whereby it was ordered to be wound up and the Official Liquidator of this court was appointed as a liquidator of the said company.

10.4 That on 30.7.2002 Judges' Summons filed by the petitioner for arrears of rent and taking possession of the leased premises was rejected by this court by a common judgment in the group matter of Fakirchand Ambalal v. O.L. Of Amruta Mills Ltd., 2002 (3) GLH 367, and that being aggrieved by the common judgment, the applicant filed O.J. Appeal No. 1 of 2003 on 21.8.2002.

10.5 It is further averred that the Official Liquidator of Ahmedabad Jubilee Mills Limited, pursuant to the order dated 8.6.2004 of this court in Company Application No.257 of 2004 in Company Petition No.139 of 1988, issued an advertisement in the newspaper inviting offers for sale of the applicant's land along with other parcels of lands. On 6.12.2004, the applicant issued notice through its advocate to the Official Liquidator stating that the applicant is the legal heir of the original owner of the subject property and the Official Liquidator is only in de- facto possession of the subject property and not entitled to sell the subject property. On 25.1.2005, by an order of the High Court, the buildings and staff quarters were auctioned by the Official Liquidator and thereupon the building and superstructure on the leasehold land were demolished.

10.6 In the meanwhile, judgment dated 17.10.2008 in the matter of Jabal C. Lashkari was delivered by the Division Bench and following the said decision, O.J. Appeal No.1 of 2003 also came to be dismissed. That against the said order, the applicants preferred S.L.P No.29632 of 2008 before the Supreme Court which by its order dated 16.12.2008 restrained the official liquidator from creating any third party rights. Thereafter, by a judgment and order dated 29.3.2016, the Supreme Court set aside the judgment of this court and remitted the matter for fresh consideration in accordance with law.

10.7 That in view of the aforesaid facts and circumstances, it has become necessary to correct the description in the title by substituting the name of Official Liquidator, Ahmedabad Jubilee Mills Limited (hereinafter referred to as "Jubilee Mills") for Ahmedabad Jubilee Spinning and Manufacturing Mills Company Limited.

10.8 As regards prayer for payment of rent, it is submitted that since 1995 till date, no rent has been paid despite direction given by the High Court by its judgment dated 23.10.2008 and arrears have mounted to Rs.10,500/-. Moreover, the Official Liquidator has not paid municipal taxes and land revenue which has now mounted to Rs.14.11 crores in terms of the AMC bill for the year 2015-16. The applicant has also annexed all the documents referred to in the application along therewith.

11. Thus, in effect and substance, the reliefs prayed for in Company Application No.16 of 1999 and Company Application No.358 of 2016 are more or less similar whereby the applicant seeks a direction to the Official Liquidator to hand over peaceful and vacant possession of the property in question and also seeks a direction to the Official Liquidator to pay the arrears of rent, mesne profits, arrears of land revenue, municipal taxes that may be found due.

12. Ms. Megha Jani, learned counsel with Mr. M. I. Hava, learned advocate for the applicant, submitted that initially, a lease was executed on 4th August 1911 by the lessor in favour of Ahmedabad Manufacturing Company. By an agreement dated 29.03.1941, the rights under the said lease deed came to be transferred in favour of Calico Limited, which by an unregistered agreement dated 24.06.1983, has transferred the leasehold rights in favour of the Jubilee Mills. It was submitted that the Official Liquidator of Jubilee Mills claims to be the lessee of the subject property under the assignment deed of 1983 between Calico Limited and Gaurav Chemtax, which is an unregistered document. It was submitted that the lease of 1911 is a yearly tenancy inasmuch as it contemplates payment of rent annually. It was submitted that under section 107 of the Transfer of Property Act, 1882 (hereinafter referred to as "the Transfer of Property Act"), a lease of immovable property from year to year can be made only by a registered instrument. Furthermore, such lease deed is also required to be registered under the provisions of section 17(1)(d) of the Registration Act, 1982 (hereinafter referred to as "the Registration Act"). It was submitted that the assignment deed of 1983 being an unregistered document, no rights flow from such document, which, though required to be registered, is not registered.

Therefore, to the extent, the agreement seeks to sublet the leasehold rights, it is not valid because it is unregistered. In support of such submission, the learned counsel placed reliance upon the decision of the Supreme Court in Anthony v. K. C. Ittoop & Sons, (2000) 6 SCC 394, wherein, it has been held thus:

"8. The lease deed relied on by the plaintiff was intended to be operative for a period of five years. It is an unregistered instrument. Hence such an instrument cannot create a lease on account of three-pronged statutory inhibitions. The first interdict is contained in the first paragraph of Section 107 of the Transfer of Property Act, 1882 (for short "the TP Act") which reads thus:

"107. A lease of immovable property from year to year, or for any term exceeding one year, or reserving an yearly rent, can be made only by a registered instrument."

(emphasis supplied)

9. The second inhibition can be discerned from Section 17(1) of the Registration Act 1908 and it reads thus: (only the material portion) "17. Documents of which registration is compulsory.--(1) The following documents shall be registered, if the property to which they relate is situate in a district in which, and if they have been executed on or after the date on which, Act XVI of 1864, or the Indian Registration Act, 1866, or the Indian Registration Act, 1871, or the Indian Registration Act, 1877, or this Act came or comes into force, namely:

(a)-(c) * * *

(d) leases of immovable property from year to year, or for any term exceeding one year, or reserving an yearly rent;"

10. The third interdict is contained in Section 49 of the Registration Act which speaks about the fatal consequence of non-compliance of Section 17 thereof.

Section 49 reads thus:

"49. Effect of non-registration of documents required to be registered.--No document required by Section 17 or by any provision of the Transfer of Property Act, 1882, to be registered shall--

(a) affect any immovable property comprised therein, or

(b) confer any power to adopt, or

(c) be received as evidence of any transaction affecting such property or conferring such power, unless it has been registered.

Provided that an unregistered document affecting immovable property and required by this Act, or the Transfer of Property Act, 1882, to be registered may be received as evidence of a contract in a suit for specific performance under Chapter II of the Specific Relief Act, 1877, or as evidence of part performance of a contract for the purposes of Section 53-A of the Transfer of Property Act, 1882, or as evidence of any collateral transaction not required to be effected by registered instrument."

No endeavour was made by the counsel to obviate thesaid interdict with the help of the exemptions contained in the proviso.

11. The resultant position is insurmountable that so far as the instrument of lease is concerned there is no scope for holding that the appellant is a lessee by virtue of the said instrument. The Court is disabled from using the instrument as evidence and hence it goes out of consideration in this case, hook, line and sinker (vide Shantabai v. State of Bombay, AIR 1958 SC 532, Satish Chand Makhan v. Govardhan Das Byas, (1984) 1 SCC 369 and Bajaj Auto Ltd. v. Behari Lal Kohli, (1989) 4 SCC 39.

12. But the above finding does not exhaust the scope of the issue whether the appellant is a lessee of the building. A lease of immovable property is defined in Section 105 of the TP Act. A transfer of a right to enjoy a property in consideration of a price paid or promised to be rendered periodically or on specified occasions is the basic fabric for a valid lease. The provision says that such a transfer can be made expressly or by implication. Once there is such a transfer of right to enjoy the property a lease stands created. What is mentioned in the three paragraphs of the first part of Section 107 of the TP Act are only the different modes of how leases are created. The first para has been extracted above and it deals with the mode of creating the particular kinds of leases mentioned therein. The third para can be read along with the above as it contains a condition to be complied with if the parties choose to create a lease as per a registered instrument mentioned therein. All other leases, if created, necessarily fall within the ambit of the second para. Thus, dehors the instrument parties can create a lease as envisaged in the second para of Section 107 which reads thus:

"All other leases of immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession."

13. When lease is a transfer of a right to enjoy the property and such transfer can be made expressly or by implication, the mere fact that an unregistered instrument came into existence would not stand in the way of the court to determine whether there was in fact a lease otherwise than through such deed.

14. When it is admitted by both sides that the appellant was inducted into the possession of the building by the owner thereof and that the appellant was paying monthly rent or had agreed to pay rent in respect of the building, the legal character of the appellant's possession has to be attributed to a jural relationship between the parties. Such a jural relationship, on the fact-situation of this case, cannot be placed anything different from that of lessor and lessee falling within the purview of the second para of Section 107 of the TP Act extracted above. From the pleadings of the parties there is no possibility for holding that the nature of possession of the appellant in respect of the building is anything other than as a lessee."

12.1 It was submitted that as the lease is not registered, the provisions of the Transfer of Property Act would not apply and the Official Liquidator is required to be treated as a statutory tenant and the provisions of the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947 (hereinafter referred to as "the Rent Act") would apply.

12.2 Reference was made to the decision of the Supreme Court in Bajaj Auto Ltd. v. Behari Lal Kohli, (1989) 4 SCC 39, wherein, the Court held thus:

"5. It has been strenuously contended by the learned counsel for the appellant that as, (i) the United Automobiles is a distributor of the product manufactured by the appellant on the basis of commission, (ii) it pays the same amount to the appellant as the rent of the premises payable by the appellant to the respondent, and (iii) is entitled to be in possession only as long as it continues to be a distributor, it should be held to be an "associate concern" within the meaning of the aforementioned term of the lease. In reply to the respondent's contention that the term cannot be taken into consideration as the deed is not a registered one, it was urged that the appellant, in view of the provisions of Section 49 of the Registration Act, is entitled to rely upon the term for "collateral purpose". The argument is that the document may not be admissible for the purpose of proving the existence of a lease or the terms thereof, but as the aforementioned clause does not come within that category, inasmuch as, it merely amounts to a written permission to the appellant to create a sub-lease, it cannot be excluded from consideration on the ground of non-registration.

6. There is no dispute that the appellant has put M/s United Automobiles in possession of the premises and has thus parted with the possession within the meaning of Section 14(1) proviso (b) of the Act. The appellant company has a separate legal entity and has nothing to do with M/s United Automobiles except that the latter is the dealer-distributor of some of its manufactured articles. M/s United Automobiles is not a licensee and is not in possession of the premises on behalf of the appellant. The monetary benefit available to the dealer is confined to the commission it receives on the sale of every vehicle; and does not include the right of enjoyment of the premises. The dealer pays a fixed sum as rent to the appellant and the rent is not related or dependent on the sale of any vehicle. The fact that this amount is same as what is paid by the appellant to the respondent does not appear to be material. The irresistible conclusion is that the appellant has created a sub-lease in favour of its dealer. The question now is whether the clause in the lease mentioned above amounts to the respondent's consent in writing.

7. The contention of the learned counsel for the respondent that the aforesaid clause cannot be looked into for want of registration or the lease deed appears to be correct. Reliance has been placed on the observations of Fazl Ali, J., in Sachindra Mohan Ghose v. Ramjash Agarwalla, (1988) 1 SCC 70, that if a decree purporting to create a lease is inadmissible in evidence for want of registration, none of the terms of the lease can be admitted in evidence and that to use a document for the purpose of proving an important clause in the lease is not using it as a collateral purpose.

8. The learned counsel for the appellant attempted to meet the point by saying that so far the consent of the landlord permitting sub-letting is concerned, it does not require registration and the clause, therefore, must be excepted from the requirement of registration and consequent exclusion from evidence. We do not see any force in this argument. The question whether a lessee is entitled to create a sub-lease or not is undoubtedly a term of the transaction of lease, and if it is incorporated in the document it cannot be disassociated from the lease and considered separately in isolation. If a document is inadmissible for non-registration, all its terms are inadmissible including the one dealing with landlord's permission to his tenant to sub-let. It follows that the appellant cannot, in the present circumstances, be allowed to rely upon the clause in his unregistered lease deed.

9. There is still another reason to hold that the aforesaid clause cannot come to the aid of the appellant. A perusal of its language would show that it contains the respondent's consent in general terms without reference to M/s United Automobiles. As a matter of fact M/s United Automobiles came to be inducted as a sub-tenant much later. Can such a general permission be treated to be the consent as required by Section 14(1) proviso (b) of the Act? It was held by this Court in Shalimar Tar Products v. S.C. Sharma that Sections 14(1) proviso (b) and 16(2) and (3) of the Delhi Rent Control Act, 1958 enjoin the tenant to obtain consent of the landlord in writing to the specific sub-letting and any other interpretation of the provisions will defeat the object of the statute and is, therefore, impermissible. Since it is not suggested that the consent of the respondent was obtained specifically with reference to the sub-letting in favour of M/s United Automobiles, the clause in the lease deed, which has been relied on cannot save the appellant, even if it be assumed in its favour that the clause is admissible and the sub-lessee is appellant's associate concern. The appeal, therefore, fails and is dismissed with costs."

12.3 It was submitted that in terms of the above decision, if a document is inadmissible for non-registration, all its terms are inadmissible, including the one dealing with landlord's permission to his tenant to sublet. Therefore, even if there is a tenant landlord relationship, the terms of the lease deed of 1911 are not available to the Official Liquidator.

12.4 Reliance was also placed upon the decision of the Supreme Court in Samir Mukherjee v. Davinder K. Bajaj, (2001) 5 SCC 259, wherein, the court held thus:

"4. To appreciate the respective contentions that have been put forward by the learned counsel for the parties we extract below Sections 106 and 107 of the Act:

"106. Duration of certain leases in absence of written contract or local usage.--In the absence of a contract or local law or usage to the contrary, a lease of immovable property for agricultural or manufacturing purposes shall be deemed to be a lease from year to year, terminable, on the part of either lessor or lessee, by six months' notice expiring with the end of a year of the tenancy; and a lease of immovable property for any other purpose shall be deemed to be a lease from month to month, terminable, on the part of either lessor or lessee, by fifteen days' notice expiring with the end of a month of tenancy.

Every notice under this section must be in writing signed by or on behalf of the person giving it and either be sent by post to the party who is intended to be bound by it or be tendered or delivered personally to such partly, or to one of his family or servants, at his residence, or (if such tender or delivery is not practicable) affixed to a conspicuous part of the property.

107. Leases how made.--A lease of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent, can be made only by a registered instrument.

All other leases of immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession.

Where a lease of immovable property is made by a registered instrument, such instrument or, where there are more instruments than one, each such instrument shall be executed by both the lessor and the lessee;

Provided that the State Government may, from time to time, by notification in the Official Gazette, direct that leases of immovable property, other than leases from year to year, or for any term exceeding one year, or reserving a yearly rent, or any class of such leases, may be made by unregistered instrument or by oral agreement without delivery of possession."

5. Section 106 lays down a rule of construction which is to apply when the parties have not specifically agreed upon as to whether the lease is yearly or monthly. On a plain reading of this section it is clear that the legislature has classified leases into two categories according to their purposes and this section would be attracted to construe the duration of a valid lease in the absence of a contract or local law or usage to the contrary. Where the parties by a contract have indicated the duration of a lease, this section would not apply. What this section does is to prescribe the duration of the period of different kinds of leases by legal fiction -- leases for agricultural or manufacturing purposes shall be deemed to be lease from year to year and all other leases shall be deemed to be from month to month. Existence of a valid lease is a prerequisite to invoke the rule of construction embodied in Section 106 of the Transfer of Property Act.

6. Section 107 prescribes the procedure for execution of a lease between the parties. Under the first para of this section a lease of immovable property from year to year or for any term exceeding one year or reserving a yearly rent can be made only by a registered instrument and remaining classes of leases are governed by the second para, that is to say all other leases of immovable property can be made either by a registered instrument or by an oral agreement accompanied by delivery of possession.

7. In the case in hand we are concerned with an oral lease which is hit by the first para of Section 107 of the Transfer of Property Act. Under Section 107 parties have an option to enter into a lease in respect of an immovable property either for a term less than a year or from year to year, for any term exceeding one year or reserving a yearly rent. If they decide upon having a lease in respect of any immovable property from year to year or for any term exceeding one year, or reserving a yearly rent, such a lease has to be only by a registered instrument. In the absence of a registered instrument no valid lease from year to year or for a term exceeding one year or reserving a yearly rent can be created. If the lease is not a valid lease within the meaning of the opening words of Section 106 the rule of construction embodied therein would not be attracted. The above is the legal position on a harmonious reading of both the sections.

8. In Ram Kumar Das, AIR 1952 SC 23, Section 106 was considered by a Bench of four Judges of this Court.

This Court held that this Section 106 lays down the rule of construction which is to be applied when there is no period agreed upon between the parties and in such cases duration has to be determined by reference to the object for the purpose for which tenancy is created. It was also held that the rule of construction embodied in this section applies not only to express leases of uncertain duration but also to leases implied by law which may be inferred from possession and acceptance of rent and other circumstances. It was further held that it is not disputed that a contract to the contrary as contemplated by Section 106 of the Transfer of Property Act need not be an express contract; it may be implied, but it certainly should be a valid contract. On the facts of the case, the Court held (at AIR p. 27, para 13) that "the difficulty in applying this rule to the present case arises from the fact that a tenancy from year to year or reserving an yearly rent can be made only by registered instrument, as laid down in Section 107 of the Transfer of Property Act".

(emphasis supplied)

9. In a recent decision of this Court in Janki Devi Bhagat Trust, (1995) 5 SCC 314, this Court held that under Section 107 of the Transfer of Property Act a lease of immovable property from year to year or for a term exceeding one year can be made only by a registered instrument and any lease of this kind would be void unless it is so created.

10. In the present case though the appellant has claimed that it was a lease for manufacturing purpose, admittedly there was no registered written lease. Therefore, the rule of construction as envisaged in Section 106 would not be applicable as the statutory requirement of Section 107 of the Act has not been satisfied. The plea of the appellant that 15 days' notice terminating the present tenancy is bad in law would not be sustainable.

12.5 Reference was made to the decision of the Supreme Court in K. B. Saha & Sons (P) Ltd. v. Development Consultant Ltd., (2008) 8 SCC 564, wherein, the Supreme Court culled out the following principles:

"34. From the principles laid down in the various decisions of this Court and the High Courts, as referred to hereinabove, it is evident that:

1. A document required to be registered, if unregistered is not admissible into evidence under Section 49 of the Registration Act.

2. Such unregistered document can however be used as an evidence of collateral purpose as provided in the proviso to Section 49 of the Registration Act.

3. A collateral transaction must be independent of, or divisible from, the transaction to effect which the law required registration.

4. A collateral transaction must be a transaction not itself required to be effected by a registered document, that is, a transaction creating, etc. any right, title or interest in immovable property of the value of one hundred rupees and upwards.

5. If a document is inadmissible in evidence for want of registration, none of its terms can be admitted in evidence and that to use a document for the purpose of proving an important clause would not be using it as a collateral purpose."

12.6 It was submitted that the agreement of 1983 is the agreement on the basis of which Jubilee Mills claims leasehold rights. Such document is inadmissible in evidence for want of registration, and hence, none of its terms can be admitted in evidence and that use of the document for the purpose of proving an important clause would not be using it as a collateral purpose.

12.7 Reliance was placed upon the decision of the Supreme Court in Park Street Properties (P) Ltd. v. Dipak Kumar Singh, (2016) 9 SCC 268, wherein, the Court held thus:

"10. The learned Senior Counsel Mr Sundaram further places reliance on the decision of this Court in K.B. Saha & Sons (P) Ltd. v. Development Consultant Ltd., (2008) 8 SCC 564, wherein it was held as under:

"34. From the principles laid down in the various decisions of this Court and the High Courts, as referred to hereinabove, it is evident that:

1. A document required to be registered, if unregistered, is not admissible into evidence under Section 49 of the Registration Act.

2. Such unregistered document can however be used as an evidence of collateral purpose as provided in the proviso to Section 49 of the Registration Act.

3. A collateral transaction must be independent of, or divisible from, the transaction to effect which the law required registration.

4. A collateral transaction must be a transaction not itself required to be effected by a registered document, that is, a transaction creating, etc. any right, title or interest in immovable property of the value of one hundred rupees and upwards.

5. If a document is inadmissible in evidence for want of registration, none of its terms can be admitted in evidence and that to use a document for the purpose of proving an important clause would not be using it as a collateral purpose.

35. In our view, the particular clause in the lease agreement in question cannot be called a collateral purpose. As noted earlier, it is the case of the appellant that the suit premises were let out only for the particular named officer of the respondent and accordingly, after the same was vacated by the said officer, the respondent was not entitled to allot it to any other employee and was therefore, liable to be evicted, which, in our view, was an important term forming part of the lease agreement. Therefore, such a clause, namely, Clause 9 of the lease agreement in this case, cannot be looked into even for collateral purposes to come to a conclusion that the respondent was liable to be evicted because of violation of Clause 9 of the lease agreement. That being the position, we are unable to hold that Clause 9 of the lease agreement, which is admittedly unregistered, can be looked into for the purpose of evicting the respondent from the suit premises only because the respondent was not entitled to induct any other person other than the named officer in the same."

16. At the outset, it would be useful to refer to the statutory provisions at play in the instant case, which are Sections 106 and 107 of the Act, which read as under:

"106.Duration of certain leases in absence of written contract or local usage.--In the absence of a contract or local law or usage to the contrary, a lease of immovable property for agricultural or manufacturing purposes shall be deemed to be a lease from year to year, terminable, on the part of either lessor or lessee, by six months' notice expiring with the end of a year of tenancy; and a lease of immovable property for any other purpose shall be deemed to be a lease from month to month, terminable, on the part of either lessor or lessee, by fifteen days' notice expiring with the end of a month of tenancy.

Every notice under this section must be in writing signed by or on behalf of the person giving it and either be sent by post to the party who is intended to be bound by it or be tendered or delivered personally to such party, or to one of his family or servants, at his residence, or (if such tender or delivery is not practicable) affixed to a conspicuous part of the property.

107. Leases how made.--A lease of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent, can be made only by a registered instrument.

All other leases of immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession.

Where a lease of immovable property is made by a registered instrument, such instrument or, where there are more instruments than one, each such instrument shall be executed by both the lessor and the lessee:

Provided that the State Government may, from time to time, by notification in the Official Gazette, direct that leases of immovable property, other than leases from year to year, or for any term exceeding one year, or reserving a yearly rent, or any class of such leases, may be made by unregistered instrument or by oral agreement without delivery of possession."

(emphasis supplied)

17. A perusal of Section 106 of the Act makes it clear that it creates a deemed monthly tenancy in those cases where there is no express contract to the contrary, which is terminable at a notice period of 15 days. The section also lays down the requirements of a valid notice to terminate the tenancy, such as that it must be in writing, signed by the person sending it and be duly delivered. Admittedly, the validity of the notice itself is not under challenge. The main contention advanced on behalf of the respondents is that the impugned judgment and order is valid in light of the second part of Section 107 of the Act, which requires that lease for a term exceeding one year can only be made by way of a registered instrument.

18. At this stage, it will also be useful to examine Clause 6 of the agreement dated 7-8-2006, which reads as under:

"6. Default.-- In the event of any default on the part of the tenants in making payment of the rent for 3 consecutive months or in the event of any breach of any of the terms and conditions herein contained and on the part of the tenants to be performed and observed and the landlord shall be entitled to serve a notice on call upon the tenants to make payment of the rent and to remedy for the breach of any of the remaining terms and conditions herein contained and if within a period of 30 days, the tenants shall fail to remedy the breach, the landlord shall be entitled to determine or terminate the tenancy."

(emphasis supplied)

Thus, in terms of Clause 6 of the agreement, the landlord was entitled to terminate the tenancy in case there was a breach of the terms of the agreement or in case of non-payment of rent for three consecutive months and the tenants failed to remedy the same within a period of thirty days of the receipt of the notice. The abovesaid clause of the agreement is clearly contrary to the provisions of Section 106 of the Act. While Section 106 of the Act does contain the phrase "in the absence of a contract to the contrary", it is a well-settled position of law, as pointed out by the learned Senior Counsel appearing on behalf of the appellant that the same must be a valid contract.

19. It is also a well-settled position of law that in the absence of a registered instrument, the courts are not precluded from determining the factum of tenancy from the other evidence on record as well as the conduct of the parties. A three-Judge Bench of this Court in Anthony v. K.C. Ittoop & Sons, (2000) 6 SCC 394, held as under:

"12. ... A lease of immovable property is defined in Section 105 of the TP Act. A transfer of a right to enjoy a property in consideration of a price paid or promised to be rendered periodically or on specified occasions is the basic fabric for a valid lease. The provision says that such a transfer can be made expressly or by implication. Once there is such a transfer of right to enjoy the property, a lease stands created. What is mentioned in the three paragraphs of the first part of Section 107 of the TP Act are only the different modes of how leases are created. The first paragraph has been extracted above and it deals with the mode of creating the particular kinds of leases mentioned therein. The third paragraph can be read along with the above as it contains a condition to be complied with if the parties choose to create a lease as per a registered instrument mentioned therein. All other leases, if created, necessarily fall within the ambit of the second paragraph. Thus, dehors the instrument parties can create a lease as envisaged in the second paragraph of Section 107 which reads thus. ...

13. When lease is a transfer of a right to enjoy the property and such transfer can be made expressly or by implication, the mere fact that an unregistered instrument came into existence would not stand in the way of the court to determine whether there was in fact a lease otherwise than through such deed.

* * *

16. Taking a different view would be contrary to the reality when parties clearly intended to create a lease though the document which they executed had not gone into the processes of registration. That lacuna had affected the validity of the document, but what had happened between the parties in respect of the property became a reality. Non-registration of the document had caused only two consequences. One is that no lease exceeding one year was created. Second is that the instrument became useless so far as creation of the lease is concerned. Nonetheless the presumption that a lease not exceeding one year stood created by conduct of parties remains unrebutted."

(emphasis supplied)

Thus, in the absence of registration of a document, what is deemed to be created is a month-to-month tenancy, the termination of which is governed by Section 106 of the Act.

20. Thus, the question of remanding the matter back to the trial court to consider it afresh in view of the fact that the same has been admitted in evidence, as the High Court has done in the impugned judgment and order, does not arise at all. While the agreement dated 7-8- 2006 can be admitted in evidence and even relied upon by the parties to prove the factum of the tenancy, the terms of the same cannot be used to derogate from the statutory provision of Section 106 of the Act, which creates a fiction of tenancy in the absence of a registered instrument creating the same. If the argument advanced on behalf of the respondents is taken to its logical conclusion, this lease can never be terminated, save in cases of breach by the tenant. Accepting this argument would mean that in a situation where the tenant does not default on rent payment for three consecutive months, or does not commit a breach of the terms of the lease, it is not open to the lessor to terminate the lease even after giving a notice. This interpretation of Clause 6 of the agreement cannot be permitted as the same is wholly contrary to the express provisions of the law. The phrase "contract to the contrary" in Section 106 of the Act cannot be read to mean that the parties are free to contract out of the express provisions of the law, thereby defeating its very intent. As is evident from the cases relied upon by the learned Senior Counsel appearing on behalf of the appellant, the relevant portions of which have been extracted supra, the contract between the parties must be in relation to a valid contract for the statutory right under Section 106 of the Act available to a lessor to terminate the tenancy at a notice of 15 days to not be applicable."

12.8 Reliance was placed upon the decision of the Supreme Court in Garware Wall Ropes Limited v. Coastal Marine Constructions and Engineering Limited, (2019) 9 SCC 209, wherein the court held that when an arbitration clause is contained "in a contract", it is significant that the agreement only becomes a contract if it is enforceable in law. Under the Stamp Act, an agreement does not become a contract, namely, that it is not enforceable in law, unless it is duly stamped. Therefore, even a plain reading of section 11(6-A), when read with section 7(2) of the 1996 Act and section 2(h) of the Contract Act, would make it clear that an arbitration clause in an agreement would not exist when it is not enforceable by law.

12.9 Reliance was also placed upon the decision of the Supreme Court in Suraj Lamp & Industries (P) Ltd. (2) v. State of Haryana, (2012) 1 SCC 656: wherein, it has been held that a lease can be validly transferred only under a registered assignment of lease.

12.10 It was accordingly contended that the sub-lease, assignment, transfer in favour of Gaurav Chemtex / Jubilee Mills is unlawful because: (i) it violates provisions of the Registration Act as well as the Transfer of Property Act because it is not registered; (ii) it also violates the provisions of the Rent Act because Calico Limited itself was a sub-lessee and the original lessee was Ahmedabad Manufacturing Company which assigned it to Calico Limited in 1941. Therefore, the status of Calico Limited was that of a sub-lessee and a sub- lessee cannot further sub-let under the provisions of the Rent Act.

12.11 It was submitted that there is no privity of contract between the lessors and Jubilee Mills. The Official Liquidator of Jubilee Mills claims to sell leasehold rights on account of assignments relying on the original lease deed of 1911. It was submitted that considering the fact that the so-called assignment deed of 1983 is unregistered, the Official Liquidator does not step into the shoes of the original lessee viz., Ahmedabad Manufacturing Company or Calico Limited. It was submitted that there is no contract between the lessors and Jubilee Mills and the terms of lease deed of 1911 are not available to Jubilee Mills, who claims to be an assignee on the basis of an unregistered document. Therefore, the Official Liquidator of Jubilee Mills can only claim protection qua his possession as a statutory tenant under the provisions of the Rent Act.

12.12 The attention of the court was invited to the provisions of sub-section (11) of section 5 of the Rent Act, which defines 'tenant' to mean any person by whom or on whose account rent is payable for any premises and includes -

(a) such sub-tenants and other persons as have derived title under a tenant before the commencement of the Bombay Rents Hotel and Lodging House Rates Control Amendment Ordinance, 1959. It was submitted that the Rent Act prohibits sublease unless it is as per section 15 of the Rent Act, that is, unless it is so provided in the contract. Therefore, in the present case, it is not open to the Official Liquidator of Jubilee Mills to rely on the terms of the contract of 04.08.1911 for the simple reason that he claims assignment of tenancy rights on the basis of an unregistered agreement which cannot be read in evidence.

12.13 It was submitted that sub-section (1) of section 15 of the Rent Act provides that notwithstanding anything contained in any law, but subject to any contract to the contrary, it shall not be lawful after the coming into operation of the Act for any tenant to sub-let the whole or any part of the premises let to him or to assign or transfer in any other manner his interest therein. Therefore, sub-section (1) of section 15 of the Bombay Rent Act ousts the operation of any other law. It was submitted that while the prohibition against sub-letting in sub-section (1) of section 15 of the Rent Act is subject to a contract to the contrary, in the present case, while the original lease deed of 1911 permits sub-letting, the Official Liquidator of Jubilee Mills cannot fall back upon the clauses of the said agreement as he is claiming tenancy on the basis of an unregistered document.

12.14 Next, it was submitted that the transfer/assignment of 1983 in favour of the Jubilee Mills is in breach of the provisions of the Urban Land (Ceiling and Regulation) Act, 1976 (hereinafter referred to as "the ULC Act"), section 6(h) of the Transfer of Property Act, section 17 read with section 49 of the Registration Act, section 107 of the Transfer of Property Act and in breach of the Contract Act, 1872, being opposed to law and public policy, and hence, the same is unlawful as contemplated under section 13(1)(e) of the Rent Act and is, therefore, the Official Liquidator of Jubilee Mills is liable to be evicted from the subject property.

12.15 Referring to the terms of the lease of 1911, it was submitted that the terms and conditions thereof contemplate transfer of leasehold rights only as a going concern. In this regard the attention of the court was drawn to clauses 6 and 2 thereof read with the recitals of the lease deed.

12.16 It was pointed out that the sub-lease in favour of the Gaurav Chemtex/Jubilee Mills is by Calico Limited, which itself was a sub-lessee. It was submitted that sub-section (2) of section 15 of the Rent Act protects only sub-lease or assignment or transfer by assignees or transferees. It does not protect any further lease or transfer by a sub-lessee. In other words, a sub-lessee cannot sub-let. In support of such submission, reliance was placed upon the decision of the Bombay High Court in N. M. Nayak v. Chhotalal, AIR 1968 Bombay 51, wherein, the court held thus:

"(31) Much argument was advanced on the construction of section 15(1) of the Act. It may be recalled that Hegde was the lessee under the landlords. He assigned the business to one Salian on July 22, 1954 and the latter assigned the same to the petitioner on February 22, 1965. The landlords then terminated the tenancy on May 26, 1965. It was contended that Salian was a tenant within the meaning of section 15(11) (a) and (aa) and if so, under section 15(1) he had a right to assign the business to the petitioner. According to Mr. Singhvi the word "tenant" in section 15(1) must have the same meaning as given to it by section 15(11) . It is argued that if the word "tenant" in section 15 is construed as a contractual tenant, then difficulty would also arise in the application of section 13 (e) of the Act, for then that section also must be limited to such a tenant and any other person cannot be evicted.

(32) Even if this meaning were given to the word "tenant" in section 15(1) the contention must fail for the reasons mentioned earlier. It is under the proviso to section 15(1) read with the relevant notification of the Government that the right of assignment the business arises, and not otherwise. Since the proviso itself is intended to except such leases or class of leases any may be specified, unless what is assigned is a lease by the lessee, the assignment must be held to be bad. Apart from that the notification itself is limited in scope as stated above.

(33) The expression 'tenant' employed in this sub- section means the contractual tenant and not the statutory tenant. See Anand Nivas Private, Ltd., v. Anandji Kalyanji's Pedhi,. Therefore the Legislature did not intend to extend any protection to the tenants of the sub-tenants or to assignees or transferees of the sub- tenants or to the sub-tenants, assignees or transferees of the assignees or transferees by introducing the proviso to that sub-section authorising the Government to issue notification granting sub-leases.

(34) Similar contention was raised in and rejected. Mr. Justice Shah says (in para 34):

"The argument that by restricting the operation of section 13(1)(e) to contractual tenants sub-letting by statutory tenants would be protected is without force. Section 12 and 13(1) have to be read together. Clause (e) of section 13(1) entitles a landlord to obtain possession where a contractual tenant has during premises or assigned or transferred his interest therein. Where a statutory tenant has purported to sublet the premises, or has purported to assign or transfer his interest therein, and in pursuance of such a transaction parted with possession he would forthwith forfeit the protection which the statute accords to him by section 12(1)"

(35) In a case like the present so far as the first tenant is concerned if his sub-letting or assignment is contrary to the Act, he would be evicted. If the assignee of an assignee of the lease is not a tenant, as we have held that he is not, he is not protected and must be evicted. So far as the first tenant and his assignee are concerned, there is nothing to protect as they are not in possession. At best, Salian was a "tenant" but as he assigned to the petitioner he cannot be protected.

(36) It was argued that if section 15(1) cannot apply an assignee of a tenant has an estate or interest in the property and therefore he would be entitled to assign it to another under the Transfer of Property Act and therefore the petitioner cannot be evicted. The contention overlooks the very provisions of section 15(1) of the Act which operates "notwithstanding anything contained in any law". The effect is that the Transfer of Property Act must stand abrogated in view of the restrictions regarding assignment and sub-letting contained in section15 (1) read with the proviso. The rights of the lessee to assign the lease or sub-let would therefore be only such as is permitted by section 15(1) and its proviso. This was decided in Chimanlal Ganpatdas v. Subashchandra Premsukh Hati C.R. A. No. 157 of 1955 D/-8-2-1956 (Bom) by Shah J., and we respectfully agree with the same."

"(40) The last contention urged by Mr. Singhvi was that even if we hold that the assignment in favour of the petitioner was unlawful, the petitioner is entitled to claim immunity by virtue of sections 15(2) of the Rent Act, Section 15(2) of the Rent Act provides:

"15(2) The prohibition against the sub-letting of the whole or any part of the premises which have been let to any tenant, and against the assignment or transfer in any other manner of the interest of the tenant therefore contained in sub-section (1) shall, subject to the provisions of this sub-section, be deemed to have had no effect before the commencement of the Bombay Rents, Hotel and Lodging House Rates Control (Amendment) Ordinance, 1959 in any area in which this Act was in operation before which this Act was in operation before such commencement; and accordingly, notwithstanding anything contained in any contract or in the judgment decree or order of a Court, any such sub-lease, assignment or transfer in favour or any such purported sub-lease, assignment or transfer in favour of any person who has entered into possession despite the prohibition in sub- section (1) as a purported sub-lessee, assignee or transferee and has continued in possession at the commencement of the said Ordinance, shall be deemed to be valid and effectual for all purposes and any tenant who has sub-let any premises or part thereof, assigned or transferred any interest therein., shall not be liable to eviction under clause (e) of sub-section (1) of section 13".

Sub-section (2) partially nullifies the bar against sub-letting, assignment or transfer imposed by sub- section (1) or by any contract or judgment with retrospective effect, provided the sub-lessee, transferee or assignee has entered into possession prior to the commencement of the Bombay Rent Ordinance III of 1959, i.e., prior to May 21, 1959 and has continued to remain in such possession of such date. The protection sought to be afforded by this sub-section extends to sub-lessee, assignee or transferee and does not extend to sub-lessee of sub-lessee or assignee or transferee or to assignee of sub-lessee or assignee or transferee. As observed earlier, in Anand Nivas Pvt. Ltd., case, the Supreme Court has held that section 15(1) applies to a contractual tenant or lessee. The transferee of a lessee is not a contractual tenant. The Legislature whilst introducing sub-section (2) intended to validate the sub-letting transfer and assignment by tenants and not further sub-letting or further derivative transfer or assignment by such sub- lessees, transferees or assignees. In our opinion the protection intended to be conferred by the Ordinance can be availed of by only those persons who can be described as sub-lessees, assignees or transferees from the contractual tenant. Our attention was invited to the judgment of Mr. Justice Chandrachud in Balkrishna Maruti v. Saidanna Sayanna, where similar observations as to construction of section 15(2) of the Rent Act have been made. We, therefore, hold that the Court below was right in holding that the petitioner was not entitled to claim any protection by virtue of section 15(2) of the Rent Act."

12.17 The learned counsel further placed reliance upon the decision of the Supreme Court in Jaisingh Morarji v. Sovani (P) Ltd., (1973) 1 SCC 197, wherein, the court held thus:

"14. The matter does not rest there because of the second limb of sub-section (2) of Section 15 of the Act. It is provided there that any such sub-lease, assignment or transfer or any such purported sub-lease, assignment or transfer in favour of any person who has entered into possession before 1959 and has continued to be in possession shall be deemed to be valid and effective.

Therefore, the sub-letting before 1959 by a tenant is valid under sub-section (2) provided such sub-lessee entered into possession and continued in possession at the commencement of the Ordinance. Such sub-letting is rendered valid notwithstanding anything contained in any contract or any decreeor order of Court. The Act as a corollary also introduced the measure that any tenant who has sub-let shall not be liable to eviction under Section 13(1)(a) of the Act.

15. The proviso and the explanation to Section 15(1) of the Act protect transfer of interest in notified leases or class of leases to assignees or transferees as well as subsequent assignees or transferees. Section 15(2) of the Act protects only sub-lease or assignment or transfer by the tenant but does not protect subsequent assignments or transfers by assignees or transferees.

16. The entire question in the present appeal is whether the Private Company is a sub-lessee protected under Section 15(2) of the Act.

17. The answer to the question is whether the respondent Private Company was a sub-tenant prior to 1959 and continued in possession at the commencement of the Ordinance in 1959. Ochhavlal in the present case gave the sub-lease to Sovani before the Ordinance. It is an indisputable feature in the present case that Sovani did not continue in possession at the commencement of the Ordinance of 1959. Sovani became a Director of the Private Company. It is the Private Company which claims to be a sublessee. The Private Company was in the first place not a sub-lessee of the tenant but a subsequent assignee from the sub-lessee. Secondly Sovani who was the sub-lessee was not in possession on the date of the Ordinance on May 21, 1959. It was the Private Company which was in possession. Therefore, the Private Company is not within the protection of Section 15(2) of the Act.

18. Section 108 of the Transfer of Property Act provides that a lessee may transfer absolutely by way of mortgage or sub-lease the whole or any part of his interest in the property, and any transferee of such interest or part may again transfer it. This provision contained in Section 108(j) of the Transfer of Property Act notices the distinction between the sub-lease by a lessee and transfer by such sub-lessee of his interest by a subsequent transfer. Section 15 of the Bombay Act dealt with only sub-letting by the tenant. That sub-letting by the tenant is no longer unlawful provided the conditions in Section 15(2) are fulfilled. It is only the sub-lease by the tenant which is mentioned in sub-section (1) and rendered valid in sub-section (2) of Section 15 of the Act. The Bombay Rent Act does not in Section 15(2) protect any further lease or transfer by the sub-lessee.

19. The Bombay High Court in a Bench decision in N.M. Nayak v. Chhotalal Hariram rightly held that Section 15(2) of the Act validated only sub-letting, transfer and assignment by tenants and no further sub-letting or further derivative transfer or assignment by such sub- lessees, transferees or assignees.

20. The word "tenant" in Section 15 of the Bombay Act means the contractual tenant. In Anand Nivas (P) Ltd. v. Anandji this Court said that the expression "tenant" in Section 15(1) of the Act means the contractual tenant and not the statutory tenant. The legislature by the Ordinance of 1959 intended to confer protection on sub- tenants of contractual tenants. The Ordinance did not confer any protection on further transfer or further sub- letting by sub-lessees of the contractual tenants."

(Emphasis supplied)

12.18 Reliance was also placed upon the decision of the Supreme Court in Shantibai v. Dinkar Balkrishna Vaidya, (1994) 4 SCC 85, wherein the court held thus:

"14. These sub-lessees (defendants 2 and 3) assigned their rights in favour of defendants 6, 7 and 8 and others who are the appellants. How can they claim protection as sub-lessees? The important point to note here is that the original lessor (sic lessee) Gore, defendants 2 and 3 sub- lessees are no longer before us. They have not filed the appeal. In these circumstances, the principle applicable to this case is as stated in Jai Singh Morarji case that a sub-tenant cannot create further sub-tenancy. Therefore, we are totally unable to see any scope for application of Section 15 of the Act. The parties are afforded liberty to contract out of the section. Even then it is only a sub- tenant who could claim protection. If in law, they are not sub-tenants of the original lessor, this section is totally inapplicable.

15. Again for the application of Section 14, there must be a lawful sub-tenancy. That is not so here. The occupants were not lawfully inducted into possession as sub-tenants either prior to 1959 or 1973. Therefore, we are unable to accept the contention urged by Mr U.R. Lalit and Mr S.K. Dholakia, learned counsel. Hence, that section is also inapplicable.

12.19 It was submitted that the Official Liquidator cannot further transfer or assign or sub-let the subject property as he is definitely a sub-tenant and, therefore, any further assignment on his part would amount to unlawful assignment. It was submitted that even under section 15 of the Rent Act, assuming that there was a valid agreement, the Official Liquidator cannot further sub-let the subject property.

12.20 Reference was made to section 19 of the Rent Act to submit that irrespective of the nature of the tenancy, whether contractual or statutory whatsoever, section 19 of the Rent Act imposes a blanket ban on the tenant or any other person in occupation from taking "any consideration" whether in cash or kind as a condition precedent to transfer or assignment of the rights of the tenant in the premises. It was urged that section 19 forms a part of the public policy enunciated by the legislature, whereby, the purpose of the section was to ensure that no tenant or any other person in occupation of any premises is able to charge any consideration (popularly known as "Pagdi" in Mumbai) for transfer or assignment of his rights in the premises so as to stop the exploitation. It was submitted that the section further provides for a blanket ban on charging of consideration except for where the premises are assigned as a going concern as provided under the proviso to section 15 and the notification thereunder.

12.21 It was further submitted that the notification, unlike the word "Tenant" which is defined under the Rent Act, uses the word "lessee", which is defined under the Transfer of Property Act and which only includes direct lessee under the contract and not a sub-tenant or a sub-lessee or his transferees. Hence, the benefit of the notification is conferred by law only to contractual lessees who are in occupation of the premises.

12.22 It was submitted that since no person, including the tenant can charge any consideration for further transfer or assignment, there is no value which can be attached to such property and that in the absence of such value, the Official Liquidator is not going to transfer or assign the premises free of cost. It was submitted that under section 18 of the Rent Act, there is a ban imposed on the landlord from charging any consideration or premium for letting the property which is again the intention of the legislature in line with the object of the Rent Act. It was submitted that the provisions of the Rent Act impose a ban on landlord and the provisions of section 19 impose the ban on tenants; thereby, there is a balancing act undertaken by the legislature to implement the public policy as reflected in these two sections. It was submitted that in view of the aforesaid, neither the landlord can charge any amount or premium for letting nor the tenant can charge any consideration for the transfer or assignment of its rights. It was contended that therefore, the Official Liquidator cannot transfer the leasehold rights because: (i) he is a statutory tenant as transfer in his favour is by an unregistered document; (ii) the Official Liquidator is a sub-tenant and cannot further sub-lease; (iii) sub-lease assignment or transfer for a premium is prohibited and punishable under the Bombay Rent Act; and (iv) Tenancy rights of a statutory tenant is not an asset of a company in liquidation. In support of such submission, learned counsel placed reliance upon the decision of the Delhi High Court in Official Liquidator of M/s Globe Associate (P) Ltd. (In Liqn) v. H.P. Sharma, ILR (1971) 1 Delhi, wherein, the court held thus:

"1) This case has come up before us on a reference made by. one of us on an application filed by the Official Liquidator on 22-10-1969 under Section 457(1)(c) of the Companies Act. 1956 for permission to sell tenancy rights of certain premises viz., basement portion of a building at 4/9 Asaf Ali Road, New Delhi which was being held by a company of which the Official Liquidator was the Liquidator appointed by this Court on 7-3-1969 in Company petition No. 78 of 1968, on a monthly rental of Rs. 300.00 (2) It is not disputed that the tenancy held by the company viz. Globe Associates Private Limited (now in liquidation) and which will hereafter be referred to as the "tenant company", was a monthly tenancy and had not been determined by the land-lord, Shri H. P. Sharma, who will hereafter be referred to as the respondent. The tenancy was not for a fixed period and was, therefore, subject to the provisions of the Delhi Rent Control Act, 59 of 1958." The said Act will hereafter be referred 'to as the Rent Act."

"(3) The case of the Official Liquidator who will hereafter be referred to as the applicant, is that the tenant- company is not doing any business nor are the premises otherwise required by him for the beneficial winding up of the company. The said tenancy rights are, however. valuable and are also transferable and are likely to fetch to the company huge amounts if they are ordered to be auctioned or sold by private contract or otherwise, as may be determined by this Court. The application also states that the tenancy rights are still subsisting.

Permission for sale of such tenancy has, therefore, been sought by the applicant."

"(21) One of the points that emerges from the above discussion is whether the sale by the liquidator is a sale by the Court or by operation of law. The contention urged by the learned counsel for the applicant is that under Section 456(1) as soon as an order of winding up is made the liquidator is required to take into his custody or under his control any property, effects or actionable claim to which the company is, or appears to be, entitled. Under sub-section (2) the property and effects of the company shall be deemed to be in the custody of the Court as from the date of the order for the winding up of the company. The property, therefore, vests in the Court and if under Section 457(1)(c) the Liquidator is required to sell that property, with the sanction of the Court, the transfer is by operation of law. The Official Liquidator acts on behalf of the Court and not on behalf of the company. The action is, therefore, the action of the Court.

(22) There are two fallacies in this argument. Firstly, when a company is being wound up its property does not vest in the Court. Secondly, when the property is ordered by the court to be sold the sale is not by operation of law."

"(40) It seems to us that the decision does not which the point with which we are concerned in this case. It is true that under Section 14(1) (b) of the Rent Act it is open to a landlord to permit the lessee to sublet, assign or otherwise part with possession of whole or any part of the premises on or after the 9th day of June 1952 after obtaining his consent in writing. But so long as that consent in writing is not given, Section 16(2) states that the premises could not be lawfully sublet. If the tenant has sublet the premises without obtaining the consent in writing of the landlord the tenant becomes liable to be evicted under Section 48(2) and he also becomes liable to be punished with fine which may extend to Rs. 1,000.00. Sub-section 3 of Section 5 renders the tenant or any person acting or purporting to act on his behalf or a sub-tenant claiming or receiving any payment in consideration of the relinquishments, transfer or assignment of his tenancy or sub-tenancy, guilty of an offence and makes its contravention punishable with simple imprisonment for a term which may extend to six months or with fine which may extend to a sum which exceeds the amount or value of un-lawful charge claimed or received under the said sub-section by Rs. 5,000.00 or with both.

(41) If the Official Liquidator, therefore, acting on behalf of the company sublets these premises, Section 1 of the Rent Act would render those premises as not have been lawfully sub-let and therefore made the sub-tenant or the transferee liable to be evicted there from. The action of the Liquidator would also render the company liable to fine under Section 48(2); but if while doing so, the Official Liquidator receives money in consideration of the transfer, or assignment of his tenancy .or sub-tenancy and that is an unlawful charge under S. 5(3) of the Act, the company or the Liquidator, as the case may be, would become liable to punishment under S. 48(1)(b)."

12.23 Reliance was also placed upon the decision of the Supreme Court in Singer India Ltd. v. Chander Mohan Chadha, (2004) 7 SCC 1, wherein the court held thus:

"5. Before adverting to the contentions raised at the Bar, it will be convenient to reproduce Section 14(1)(b) of the Act, which reads as under:

"14. Protection of tenant against eviction.--(1) Notwithstanding anything to the contrary contained in any other law or contract, no order or decree for the recovery of possession of any premises shall be made by any court or Controller in favour of the landlord against a tenant:

Provided that the Controller may, on an application made to him in the prescribed manner, make an order for the recovery of possession of the premises on one or more of the following grounds only, namely--

(a) * * *

(b) that the tenant has, on or after the 9th day of June, 1952, sub-let, assigned or otherwise parted with the possession of the whole or any part of the premises without obtaining the consent in writing of the landlord;"

There is no ambiguity in the section and it clearly says that if, without obtaining the consent in writing of the landlord the tenant has, on or after 9-6-1952 (i) sub-let, or (ii) assigned, or (iii) otherwise parted with the possession of the whole or any part of the premises, he would be liable for eviction. The applicability of the section depends upon occurrence of a factual situation, namely, sub-letting or assignment or otherwise parting with possession of the whole or any part of the premises by the tenant. Whether it is a voluntary act of the tenant or otherwise and also the reasons for doing so are wholly irrelevant and can have no bearing. This view finds support from an earlier decision rendered in Parasram Harnand Rao v. Shanti Parsad Narinder Kumar Jain, (1980) 3 SCC 565, wherein Section 14(1)(b) of the Delhi Rent Control Act came up for consideration. The tenant in the premises was Laxmi Bank, which was ordered to be wound up and in that winding-up proceeding, the Court appointed an official liquidator who sold the tenancy rights in favour of S.N. Jain on 16-2-1961. The sale was confirmed by the High Court and, as a result thereof, S.N. Jain took possession of the premises. Thereafter, the landlord filed a petition for eviction of Laxmi Bank. The High Court held that as the transfer in favour of S.N. Jain by the official liquidator was confirmed by the Court, he acquired the status of the tenant by operation of law and, therefore, the transfer of the tenancy rights was an involuntary transfer and the provision of Section 14(1)(b) of the Act would not be attracted. Reversing the judgment, this Court held that the official liquidator had merely stepped into the shoes of Laxmi Bank which was the original tenant and even if the official liquidator had transferred the tenancy interest to S.N. Jain under the orders of the Court, it was on behalf of the original tenant. It was further held that the sale was a voluntary sale, which clearly was within the mischief of the section, and assuming that the sale by the official liquidator was an involuntary sale, it undoubtedly became an assignment as provided by Section 14(1)(b) of the Act. The Court further held that the language of Section 14(1)

(b) is wide enough not only to include any sub-lease but even an assignment or any other mode by which possession of the tenanted premises is parted with and the provision does not exclude even an involuntary sale."

12.24 Reference was made to the decision of the Delhi High Court in Devinder Kumar Bajaj v. Pure Drinks (New Delhi) Pvt. Ltd., 2001 (57) DRJ 773, wherein the court held thus:

"1. This is an application filed by the Defendant under Section 442 of the Companies Act for the stay of proceedings. It is predicated on the fact that a winding up petition had been admitted and citation has also been issued. The winding up petition, however, was filed on 30th January, 1997. Even if this contention of the Defendant was otherwise well-founded it ought to have approached the Court with expedition, and certainly within a period of three years of the relevant event. This has not been done and accordingly the application can be dismissed on this short point. However, my attention has also been drawn to a decision of the Hon'ble Supreme Court in The Official Liquidator v. Dharti Dhan (P) Ltd., AIR 1977 SC 740, in which it has been observed that the passing of orders staying proceedings should not be carried out in a mechanical manner. The Apex Court specifically enjoined that if it appears to the Court that the application had been filed with the intention of the delaying the proceedings, it should not be permitted. Learned counsel has also relied on Basumati Mahajan v. Foremost Industries India Ltd., 1995 (34) DRJ 732, where, following the previous decisions including Smt. Nirmala R. Bafna/Kershi Shivax Cambatta and Ors. v. Khandesh Spinning & Weaving Mills Co. Ltd. and Anr./official Liquidator and Ors., AIR 1993 SC 1380, Hon'ble Justice K. Ramamoorthy had held that Sections 442 and 446 would not be attracted where the tenancy rights of a company involved in liquidation were concerned. He has also relied on Hansa Industries Pvt. Ltd. and Ors. v. Kidarsons Industries P. Ltd. an Ors., 1998 III AD (Delhi) 27, to the effect that since subletting is not permissible, even in view of the Rent Control legislation, tenancy rights would not be assets of a company which required protection even in the currency of the winding up proceedings.

Learned counsel for the Plaintiff had submitted that where, as in the present case, no statutory protection was available to the company viz-a-viz the tenancy, there would be no question of the tenancy constituting an asset of the company."

12.25 Reliance was placed upon the decision of the Supreme Court in Shree Chamundi Mopeds Ltd. v. Church of South India Trust Assn., (1992) 3 SCC 1, wherein, the court held thus:

"13. We are also unable to agree with the contention of the learned counsel for the appellant-company that the leasehold interest of the appellant-company in premises leased out to it is property for the purpose of Section 22(1). It is no doubt true that leasehold interest of the lessee in the premises leased out to him is property which can be transferred and the said interest can also be attached and sold by way of execution in satisfaction of a decree against a lessee. In that sense, it can be said that the leasehold interest of a company is its property.

But the question is whether the same is true in respect of the interest of a company which is in occupation of the premises as a statutory tenant by virtue of the protection conferred by the relevant rent law because in the instant case on the date of reference to the Board the proceedings for eviction of the appellant-company were pending and the appellant-company was in occupation of the premises only as a statutory tenant governed by the provisions of the Karnataka Rent Control Act. In Gian Devi Anand v. Jeevan Kumar, (1985) 2 SCC 683, this court has laid down that the termination of a contractual tenancy does not bring about a change in the status and legal position of the tenant unless there are contrary provision in the relevant Rent Act and the tenant, notwithstanding the termination of tenancy, does enjoy an estate or interest in the tenanted premises. It is further laid down that this interest or estate which the tenant continues to enjoy despite termination of the contractual tenancy creates a heritable interest in the absence of any provision to the contrary. This Court has also held that the legislature which by the Rent Act seeks to confer the benefit on the tenants and to afford protection against eviction, is perfectly competent to make appropriate provision regulating the nature of protection and the manner and extent of enjoyment of such tenancy rights after the termination of contractual tenancy of the tenant including the rights and the nature of protection of the heirs on the death of the tenant.

15. From these provisions, it would appear that except in cases covered by the two provisos to sub-section (1) of Section 23, there is a prohibition for a tenant to sublet whole or any part of the premises let to him or to assign or transfer in any other manner his interest therein. This prohibition is, however, subject to a contract to the contrary. A tenant who sublets or assigns or transfers the premises in contravention of this prohibition loses the protection of law and can be evicted by the landlord under Section 21(1)(f). In the case of a statutory tenant, the relationship is not governed by contract. The prohibition against assignment and transfer is, therefore, absolute and the interest of a statutory tenant can neither be assigned nor transferred. This means that the interest of the statutory tenant in the premises in his occupation, as governed by the Karnataka Rent Control Act is a limited interest which enables the surviving spouse or any son or daughter or father or mother of a deceased tenant who had been living with the tenant in the premises as a member of the tenant's family up to the death of the tenant and a person continuing in possession after the termination of the tenancy in his favour, to inherit the interest of the tenant on his death. The said interest of the tenant is, however, not assignable or transferable and, therefore, the interest of a company which is continuing in occupation of the premises as a statutory tenant by virtue of the protection conferred by the Karnataka Rent Control Act, cannot be regarded as property of the company for the purpose of sub-section (1) of Section 22 of the Act and for that reason also the provisions of Section 22(1) were not attracted to the eviction proceedings instituted by the respondents against the appellant-company. The provisions of Section 22(1) did not, therefore, bar the prosecution of the said proceedings by the respondents and the order dated September 30, 1989 passed by the XII Additional Small Causes Judge, Bangalore allowing the eviction petition cannot be held to have been passed in contravention of the provisions of Section 22(1) of the Act. Civil Appeal No. 2553 of 1991 also, therefore, fails and is liable to be dismissed.

12.26 Reliance was also placed upon the decision of the Supreme Court in Ravindra Ishwardas Sethna v. Official Liquidator, (1983) 4 SCC 269, wherein, the court held thus:

"9. The Company was a tenant or a lessee of the premises of which the appellants are the landlords. The date of the commencement of the lease is not made available to us, but it is also not claimed on behalf of the Liquidator that there was lease of long duration. If so, the Company was a statutory tenant under the Rent Act. The statutory tenancy confers the right to be in possession but if the tenant does not any more require use of the premises, the provisions of the Rent Act and especially Sections 13 and 15 completely prohibit giving the possession of the premises on licence or on sub-lease. The learned Company Judge therefore spelt out a third way of parting with the possession by the Liquidator, namely, that he may give the premises to the second respondent under a caretaker's agreement. This caretaker's agreement appears to us to be an euphemism for collecting compensation which is nothing else but the charge for use and occupation of the premises exclusively by the second respondent. Whether it is sub-lease or licence does not call for decision. For the purpose of the present proceedings it is enough for us to say that the Company and its Liquidator no more needs the premises for its own use. The Liquidator does not need the use of the premises for carrying on the winding-up activities of the Company because he sought direction for parting with possession. We are not impressed by the learned Judge saying that there is some third mode of parting with possession of the premises exclusively in favour of the second respondent, namely, caretaker's agreement which appears to us to be a facade to wriggle out of the provisions of the Rent Act.

The Rent Act is no doubt enacted for protecting the tenants, and indisputably its provisions must receive such interpretation as to advance the protection and thwart the action of the landlord in rendering tenants destitutes. But this does not imply that the court should lend its aid to flout the provisions of the Rent Act so as to earn money by unfair and impermissible use of the premises. And that is what the Liquidator sought to do and the Court extended its help to the Liquidator. This, in our opinion, is wholly impermissible. The learned Company Judge could not have authorised the Liquidator to enter into such an agreement and therefore his order is liable to be set aside.

10. In the appeal before the Division Bench, this aspect was not at all examined because it is stated that this aspect was not canvassed before the Bench hearing the appeal. The point we have examined goes to the root of the matter and, therefore, we consider it immaterial whether the point was examined at the hearing of the appeal.

11. The learned Company Judge could not have permitted holding on to possession of the premises, not needed for efficiently carrying on winding-up proceedings. The only course open to him was to direct the Liquidator to surrender possession to landlords and save recurring liability to pay rent. Before we part with this judgment, we must take note of one submission that was made on behalf of the respondent. It was said that the creditors and members of the Company in liquidation have suffered huge losses and if the Liquidator would have been permitted to enter into an agreement with the second respondent, it would fetch a steady income which would have gone towards mitigating the hardships of the creditors and members of the Company. The accounts of the Company in liquidation were not brought to our notice nor can we permit violation of law howsoever laudable the object of such act may be. However, we must record a statement made on behalf of the appellants when the aforementioned argument was being examined by us. It was said that the second respondent was to pay Rs 2500 per month as compensation under the directions of the Court. That would have fetched the Liquidator an income of Rs 30,000 per year and deducting the costs, expenses and taxes, the Liquidator may have been able to realise at least Rs 25,000 per year. The learned counsel for the appellants submitted that adopting a multiplier of six, assuming that roughly six years was the period for which the agreement would have been renewed from year to year, the appellants unconditionally offered to deposit Rs 1,50,000 in the Court to be distributed at the discretion of this Court amongst the creditors of the Company in liquidation. We recorded this offer in our order disposing of the appeal. We are now informed that the amount has been deposited. The Liquidator is accordingly directed to submit the list of the creditors of the Company with the names, addresses and claims admitted by him within 4 weeks from today when the matter will appear again on board for directions."

12.27 Reliance was placed upon the decision of the Supreme Court in the case of Nirmala R. Bafna (Smt) v. Khandesh Spinning and Weaving Mills Co. Ltd., (1992) 2 SCC 322, wherein, the court held thus:

"18. It is admitted by the official liquidator that the Board of Directors of the company had indeed passed a special resolution affirming the agreement of sub- tenancy in favour of the appellant. (In her plaint in Suit No. 4873 of 1984 the appellant has referred to the said special resolution of the Board of Directors.) This fact coupled with the statement of the learned counsel for the landlord trust establishes, prima facie, the appellant's plea of sub-tenancy. That she was in possession of a major portion of the said flat on the date of appointment of liquidator is also not in dispute. According to the sub- tenancy agreement, the rent payable by the appellant is Rs 600 per month as against Rs 900 per month payable by the company to the landlord for the entire flat. In the above circumstances, we cannot reject, prima facie speaking, the appellant's claim of protection of Bombay Rent Control Act. In addition to this factual situation, there are two other circumstances which must be taken into consideration, viz.,

(a) The tenancy rights the company had in the said flat may not be an asset for the purpose of liquidation proceedings and

(b) merely because a company goes in to liquidation and a liquidator/official liquidator is appointed, the rights of the company vis--vis its landlord and/or its tenants do not undergo any change."

12.28 It was submitted that in the present case, in the absence of any contract to the contrary, in view of the provisions of sub-section (1) of section 15 of the Rent Act, it is not permissible for the Official Liquidator to sub-let, assign or transfer the interest of the company in liquidation in the subject property, and hence, the leasehold rights/tenancy is not an asset of the company in liquidation.

12.29 It was contended that the leasehold rights of a company in liquidation cannot be sold contrary to provisions of the Rent Act. In support of such submission, reliance was placed upon the decision of this Court in Kanubhai H. Prajapati v. Official Liquidator, 1999 (1) GLR 423, wherein, the court held thus:

"14. Principles emerging as a result of above discussion can broadly be summarised thus:

1. The rights and obligations arising under rent laws as landlord and tenant subsist between the owner and the company in liquidation after the order of winding up is made until the company is dissolved.

2. The leased property cannot be transferred or alienated contrary to the provisions of the Rent laws.

3. Even where the company has closed its business and the premises are not required for the purposes of carrying on the business, still the official liquidator is entitled to retain possession if it is required by him during the course of winding up for the purpose of company's affairs, for example, keeping records, storing the stock-in-trade and other movables or if the same are occupied by plant and machinery. Such requirement is relevant consideration for refusing the permission to return possession to the landlord; and

4. The leasehold tenancy rights under a lease are the assets of the company which may be dealt with and transferred if official liquidator is required to transfer the assets of the company as a going concern subject of course, to law permitting the same. The transferability of the assets is a relevant consideration while deciding the question whether the property is burdened with onerous convenants."

12.30 It was submitted that the Official Liquidator represents the company in liquidation and the sale by him will be voluntary and even if by order of the court, it is not sale by court. It was further submitted that the Official Liquidator is just a statutory tenant. A statutory tenant is entitled only to possession or protection against eviction and has no right of sale, transfer or assignment of leasehold rights. In support of such submission, the learned counsel placed reliance upon decision of this court in Uttara Achyut Chinubhai v. O.L. of Nanikram Shobhraj Mills, 2010 (5) GLR 429, wherein, the court held thus:

"13. The aforesaid goes to show that though the company is not the owner of the property, its status in the property or rights in the property cannot be said as that of under the contractual monthly tenancy but the statutory tenancy as per the provisions of the Bombay Rents Hotel and Lodging House Rates Control Act, 1947 (hereinafter referred to as the Rent Act). The fact remains that the company has continued to occupy the property since 1938 as the lessee under the contractual tenancy and after the expiry of the period, it has continued to occupy the property as the tenant under the Rent Act. The law on the aspect of, tenant in occupation of the property after the expiry of the contractual tenancy, is well settled inasmuch as if the contractual tenancy exists, the rights of the landlord and tenant would be governed by the contract unless expressly barred by any statute. After the expiry of the period, if the tenant has continued to occupy the property, his status would be protected by the statute and the terms and conditions for the rights of the landlord and tenant would be government by the statute, which is the Rent Act in the present case.

16. So far as the rights of the landlord against the statutory tenant for recovery of the possession is concerned, they are expressly provided under Section 13 of the Act for the various circumstances as mentioned therein Clause (a) to (l). The pertinent aspect is that none of the circumstances except that the company does not require the property for winding up are alleged by the applicant owner in the present application. It also deserves to be recorded that if the owner of the property has to recover the possession under the Rent Act, the normal remedy for such owner is to file civil suit for recovery of the possession. However, as Official Liquidator is functioning under the supervision of this Court as per the provisions of the Companies Act, the present application has been preferred by the applicant owner."

12.31 Reliance was placed upon the decision of this court in Anil Pvt. Ltd. v. O.L. of G.S.T.C., rendered on 10.05.2002 in Company Application No. 174 of 2001, wherein, the court held thus:

"12. Mr. Soparkar in rejoinder submitted that apropos the contention raised by Mr. Desai on behalf of the Liquidator that the applicant Company must make payment for the purpose of vacating the premises cannot be countenanced because such course of action was not permissible in law and the applicant was not ready to commit any illegality. Distinguishing the Calcutta High Court Judgment in the case of Kailash Financiers (supra) Mr. Soparkar submitted that the said judgment dealt with the position of Tenancy Law in West Bengal and was not applicable in case of the premises in question which would be governed by the Rent Act. That even if the provisions under the Rent Act and the West Bengal Rent Control Law were the same, the judgment did not lay down the correct law in light of the Supreme Court decision in case of Ravindra Ishwardas Sethna (supra). He therefore urged that once the Official Liquidator was prevented in law from transferring the leasehold rights there was no question of holding on to the said rights and thus the premises in question would be an onerous holding requiring Official Liquidator to pay rent continuously for a property which was not required for the purpose of the business of the Company in liquidation.

13. xxx

14. From the undisputed facts which have come on record, it is apparent that there is no deed of lease and the Company in liquidation had occupied the premises in question on a monthly tenancy. The nature of the tenancy therefore itself shows that the tenancy was terminated every month subject to payment of rent. There is no dispute that the premises in question situated at Mumbai are not of any use so far as the Official Liquidator is concerned. The said premises are not required by the Company for the purpose of business of the Company or for the purpose of winding up the Company in liquidation."

12.32 Reliance was placed upon the decision of this Court in Dhairyasinh P. Rajda v. Ahmedabad Manufacturing & Calico Ptg. Mills Co. Ltd., 2015 JX (Guj) 798, wherein, the court held thus:

"26. Thus, in view of the aforesaid decisions rendered by the Hon'ble Supreme Court as well as this Court, in the facts and circumstances of the present case, when it is revealed from the record that the applicant is the co- owner of the property in question, a property in question was given on rent by his ancestors to M/s. Ahmedabad Manufacturing & Calico Ptg. Mills Co. Ltd., which was thereafter taken into liquidation by an order passed by this Court in the year 1998 and when the reports given by the solicitors and the advocates of the Official Liquidator revealed that the property in question does not belong to the company in liquidation, the Official Liquidator is not having any right to retain the possession of the said property. The applicant being co-owner of the premises in question is entitled to get back the possession of the same.

27. xxx

28. Thus, the Official Liquidator is hereby directed to handover peaceful and vacant possession of the property in question after removing the seal to the applicant and co-owner, if any, within a period of eight weeks from the date of receipt of this order."

12.33 It was submitted that the Official Liquidator does not require the subject property for the purpose of winding up, which is clear from the fact that he has invited offers for sale of the land in 2004. It was submitted that there is no question of selling it as a going concern as the plant and machinery are sold and buildings are demolished. Therefore, subletting, assignment or transfer of the subject property by Official Liquidator would be unlawful and would be an offence.

12.34 Next, it was submitted that the appellant landlord is entitled to eviction on four counts: (i) on the count of non- payment of rent; (ii) non-user; (iii) change in user; and (iv) illegal assignment. It was submitted that the Official Liquidator of the company in liquidation has not paid the rent since 2016. Prior thereto also, rent had not been paid for a considerable period of time despite the order dated 23.10.2008 passed by the Division Bench in OJ Appeal No. 1 of 2003 and that, after issuance of notice by the applicant on 02.09.2016, Rs.10,000/- was paid on 10.01.2017, after a period of more than three months and the remaining Rs.500/- was paid subsequent thereto.

12.35 Reliance was placed upon the decision of the Supreme Court in Yusufbhai Noormohammed Jodhpurwala v. Mohd. Sabir Ibrahim Byavarwala, (2015) 6 SCC 526, wherein, the court held thus:

"8. The law on Section 12(3)(b) is well settled by a series of judgments of this Court. In Ganpat Ladha v. Sashikant Vishnu Shinde, (1978) 2 SCC 573 this Court overruled a judgment in Kalidas Bhavan v. Bhagvandas Sakalchand case, (1958) 60 Bom LR 1359, in which a Division Bench of the Bombay High Court thought that it was open under Section 12(3)(b) to exercise a discretion in favour of the tenant. In para 11 of the said judgment, it was stated:

11. "It is clear to us that the Act interferes with the landlord's right to property and freedom of contract only for the limited purpose of protecting tenants from misuse of the landlord's power to evict them, in these days of scarcity of accommodation, by asserting his superior rights in property or trying to exploit his position by extracting too high rents from helpless tenants. The object was not to deprive the landlord altogether of his rights in property which have also to be respected. Another object was to make possible eviction of tenants who fail to carry out their obligation to pay rent to the landlord despite opportunities given by law in that behalf. Thus, Section 12(3)(a) of the Act makes it obligatory for the Court to pass a decree when its conditions are satisfied as was pointed out by one of us (Bhagwati, J.) in Ratilal Balabhai Nazar v. Ranchhodbhai Shankerbhai Patel, AIR 1968 Guj 172.

If there is statutory default or neglect on the part of the tenant, whatever may be its cause, the landlord acquires a right under Section 12(3)(a) to get a decree for eviction. But where the conditions of Section 12(3)(a) are not satisfied, there is a further opportunity given to the tenant to protect himself against eviction. He can comply with the conditions set out in Section 12(3)(b) and defeat the landlord's claim for eviction. If, however, he does not fulfil those conditions, he cannot claim the protection of Section 12(3)(b) and in that event, there being no other protection available to him, a decree for eviction would have to go against him. It is difficult to see how by any judicial valour discretion exercisable in favour of the tenant can be found in Section 12(3)(b) even where the conditions laid down by it are satisfied to be strictly confined within the limits prescribed for their operation. We think that Chagla, C.J., was doing nothing less than legislating in Kalidas Bhavan case in converting the provisions of Section 12(3)(b) into a sort of discretionary jurisdiction of the court to relieve tenants from hardship. The decisions of this Court referred to above, in any case, make the position quite clear. Section 12(3)(b) does not create any discretionary jurisdiction in the court. It provides protection to the tenant on certain conditions and these conditions have to be strictly observed by the tenant who seeks the benefit of the section. If the statutory provisions do not go far enough to relieve the hardship of the tenant the remedy lies with the legislature. It is not in the hands of courts."

This statement of the law was followed in Jamnadas Dharamdas v. J. Joseph Farreira, (1980) 3 SCC 569, at para 12 and Mranalini B. Shah v. Bapalal Mohanlal Shah, (1980) 4 SCC 251 at para 12.

9. In the judgment cited by the impugned judgment, namely, Vasant Ganesh Damle, (2002) 4 SCC 183, this Court categorically held that the right conferred upon a bona fide tenant can be availed of only twice under the Act and not thereafter.

10. On facts, it is clear that the tenant was in arrears of rent prior to the filing of the suit and continued to be so. On the date of the first hearing of the suit, that is the date on which issues were struck, namely, 3-8-1994, the rent that was paid admittedly fell short by Rs 270. It is clear therefore that assuming that the respondent is a bona fide tenant the right that is conferred upon him by the legislature can be availed of only twice and on both occasions the tenant was found to be in arrears. The High Court was wrong in interpreting Section 12(3)(b) purposively holding that so long as the High Court, in its discretion, feels that there is a readiness and willingness on the part of the tenant to pay rent, the High Court can in its discretion say that substantial compliance with Section 12(3)(b) is good enough for the tenant to escape eviction on the ground of non-payment of arrears of rent. Having regard to the judgments of this Court and the fact that Section 12(3)(b) has been construed to be a mandatory provision which must be strictly complied with, the judgment under appeal has to be set aside, and the order of the Appellate Bench of Small Causes restored."

12.36 It was submitted that Jubilee Mills has closed its operations since 10.03.1987. The Official Liquidator does not require the subject property for winding up. The sale of the subject property would be an ex facie illegal and unlawful act and if the court approves the sale, it would be approving something that is prohibited by law and is an offence. There is no proposal or scope of revival of the company. The land is not required for any purpose when the winding up is going on and all the assets have been sold and dissolution is just a matter of time. It was submitted that since the Official Liquidator does not require the land for conducting liquidation of the company, the only course open is to direct him to surrender the leasehold rights. In support of such submission, reliance was placed on the decision of the Supreme Court in Ravindra Ishwardas Sethna v. Official Liquidator (supra), wherein it has been held that the learned Company Judge could not have permitted holding on to possession of the premises, not needed for efficiently carrying on winding-up proceedings. The only course open to him was to direct the Liquidator to surrender possession to landlords and save recurring liability to pay rent.

12.37 It was submitted that when Calico Limited transferred the leasehold rights under the 1911 agreement under the unregistered assignment deed of 1983, the same amounted to an implied surrender of the tenancy. In support of such submission the learned counsel placed reliance upon the decision of the Supreme Court in T. K. Latika v. Seth Karsandas Jamnadas, (1999) 6 SCC 632, wherein, the court held thus:

"12. The principle which governs the doctrine of implied surrender of a lease is that when a certain relationship existed between two parties in respect of a subject matter and a new relationship has come into existence regarding the same subject matter, the two sets cannot coexist, being inconsistent and incompatible between each other i.e. if the latter can come into effect only on termination of the former, then it would be deemed to have been terminated in order to enable the latter to operate. A mere alteration or improvement or even impairment of the former relationship would not ipso facto amount to implied surrender. It has to be ascertained on the terms of the new relationship vis--vis the erstwhile demise and then judged whether there was termination of the old jural relationship by implication."

12.38 In conclusion it was submitted that the applications therefore, deserve to be allowed in terms of the relief prayed for therein.

13. Opposing the application, Mr. Kamal Trivedi, Senior Advocate, learned counsel with Mr. Jeet Bhatt, learned advocate for the Official Liquidator, invited the attention of the court to the recitals contained in the lease deed of 1911 and more particularly, the preamble and clauses 1, 3, 6 and 10 thereof. It was submitted that on a plain reading of the recitals contained in the lease deed, it is evident that it is a lease for an indefinite period and hence, it is a permanent/perpetual lease.

13.1 It was submitted that a lease for an indefinite period is called a "Permanent/Perpetual Lease"; whereas, a lease for a definite period is called a "Fixed Term lease". If no term is fixed under the lease, and if it contains a provision for the rights flowing therefrom being heritable, then such a lease would be construed as permanent lease. In support of such submission, learned counsel placed reliance upon the decision of the Supreme Court in Chapsibhai Dhanjibhai Danad v. Purushottam, 1971 (2) SCC 205, wherein, the court held thus:

"10. Looking at the document (Ex. P-4) as a whole, the lease undoubtedly is for building a residential structure. Though it is for 30 years certain, the lessee was entitled to remain in possession of the land so long as he paid the stipulated rent, which the lessor was not entitled to increase. But, though the lease is for building structure and the period is indefinite, there are at any rate no express words indicating that the leasehold rights thereunder were intended to be heritable. On the other hand, it expressly provides, as was the case in Abdul Rahim's case (supra) for the right of the lessee to remove the structures, meaning thereby vacating the land, if he so desired. The clause providing for such removal is not that the lessee would remove the structures on default in payment of rent, but depends on his own volition, a clause indicative of the parties not having intended the lease to be permanent. For, if it was intended to be permanent, there was no necessity for providing such a right. But the argument was that there are words in the document indicative of the lease having been intended to be heritable as was the case in Sivayogeswara Cotton Press (supra). The mere fact, however, that a lease provided for the interests thereunder to pass on to the heirs of the lessee would not always mean that it is a permanent lease. Such a provision can be made in two ways resulting in two different consequences. A lease may provide a fixed period and then include a provision that in the event of the lessee dying before the expiry of such period, his heirs would be entitled to have the benefit of the lease for the remainder of the period. In such a case, although the lease may provide for the heirs to succeed to the interests in the leased land, it would only mean that such heirs succeed to the rights upto the expiry of the lease period. If the lease, on the other hand, were for an indefinite period, and contains a provision for the rights thereunder being heritable, then, such a lease, though ordinarily for the lifetime of the lessee, would be construed as permanent. The question, therefore, is to which of these two classes of leases the present lease belongs.

xxx

14. In our view the lease before us is dearly distinguishable from that in the case of Sivayogeswara Cotton Press (supra) where the leasehold rights were in clear terms made heritable and where the Court held that clause (14) though placed last in the document, governed all its terms. There is no provision in the present case comparable with such a clause. The lease was undoubtedly for an indefinite period which only means that it was to enure for the lessee's lifetime. Reference in it of the heirs of the lessee is only for the limited purposes set out earlier and not for making the leasehold interests heritable. We do not find in the document words such as those in Sivayogeswara Cotton Press (supra), which would compel us to the conclusion that the lease was intended to be permanent."

13.2 It was submitted that if no term is fixed under the lease and if it is for building purposes (like the clause below the chart at internal page 3 of the lease deed in question), allowing the lessee to remain in possession so long as he pays rent, it is a permanent lease. Reliance was placed upon the decision of the Supreme Court in the case of Sivayogeshwara Cotton Press v. M. Panchaksharappa, AIR 1962 SC 413, wherein, the court held thus:

"10. Reliance was also placed upon the decision of the Calcutta High Court in Promada Nath Roy v. Srigobind Chowdhry. In that case the Kabuliat did not specify any period during which the lease was to subsist. It has been stipulated that the land was to be held from year to year at an annual rent and that in the event of a masonry building being erected on the land, rent was to be assessed at the prevailing rate. Eventually, the tenant built the structure on the land. It was held by the Calcutta High Court that the parties contemplated the lease to be for building purposes and that therefore the court could presume that the lease was intended to be permanent. The terms of the lease in that case also were not as telling as in the case before us.

xxx

12. But it was contended on behalf of the plaintiff- respondent that the term expressly granting the lessee the right to give up possession at will was wholly inconsistent with the permanency of the tenancy. In our opinion, the presumption raised by the fact that the lease was for building purposes and therefore intended to be permanent is not weakened by the fact that the lessee had stipulated with the lessor to be entitled to give up possession if and when he decided to do so. It is a right reserved in favour of the lessee and did not confer, as already pointed out, any corresponding right on the lessor. Such a right in favour of the lessee cannot be converted into a disability or an obligation which should detract from the grant of a permanent tenancy. Such a stipulation which gives a right to the tenant to surrender the lease-hold at any time he decided to do so, if it is coupled with a corresponding right in the landlord to serve notice of ejectment at any time he chose to do so may have the effect of making the tenancy, a tenancy at will, but such a conclusion has been negatived by the High Court and rightly enough."

13.3 It was submitted that the lease does not cease to be a permanent lease, if it empowers the lessor to re-enter the possession in the event of non-payment of rent (like clause 1 of the lease deed in question) since such a provision is merely a security for the payment of rent. In support of such submission, reliance was placed upon the decision of the Oudh High Court in the case of Bhagwati Prasad and Others v. Balgobind and Others, AIR 1933 Oudh 161, wherein, the court held thus:

"4. It is not necessary to determine in the present suit whether or not the plaintiff is an under-proprietor in the village by virtue of the lease in question. The appellants' learned counsel contends that the plaintiff should not be treated as a member of the village community entitled to claim the right of pre-emption, as the lease in question contains a provision to the effect that if the lessee or his transferees or legal representatives failed to pay the instalments of rent at the stipulated time they would be liable to ejectment at the end of the year under Section 52 of the Oudh Bent Act. In our opinion, this contention is not well founded, and must be overruled. The lease under consideration does not cease to be a lease in perpetuity simply because it contains the forfeiture clause in question. The forfeiture clause in question does not affect the permanency of the tenure as long as the annual rent is paid. The provision for the forfeiture of the lease for non-payment of rent was intended merely as a security for the payment of rent. The interest in the land, which the grantor intended to transfer to the lessee, was certainly heritable, transferable and perpetual. It must be held consequently that in spite of the forfeiture clause the lease before us is a permanent lease held at a rent fixed in perpetuity. As pointed out by a Bench of this Court in Asghar Husain v. Sardar Husain a village community under the Oudh Laws Act consists of the whole body of persons possessing right as proprietors, under-proprietors or heritable lessees in village lands."

13.4 Reference was made to the decision of a Division Bench of this court in Jabal C. Lashkari v. Official Liquidator of Prasad Mills Ltd. & Others, 2009 (1) GLR 158, wherein, the court held that the landlord does not have any right to seek possession of the demised land except as stipulated in clause (1) read with clause (8) of the lease deed which provided that in case the lessee fails to pay the annual rent from year to year, the lessor shall be entitled to give a registered notice and if during the notice period, the payment is not made, the lessor would be entitled to initiate action to claim back possession."

13.5 Reliance was placed upon the decision of the Karnataka High Court in Sreenivas Shenoy v. Vasudeva Shenoy, ILR 1994 Kar 1102, wherein, the court held thus:

"17. Point No. 2: Under this Point it is required to be seen as to whether the property in question was sublet by respondents - 1 to 5 and if so, whether the same is a ground for eviction under the Act having regard to the nature of the lease reflected in the deed dated 18.6.1917. The learned District Judge has on fact reached a conclusion that the lease in question is a permanent lease. It can be taken as having been well-settled that even if a lease deed provides for a ground for eviction under the T. P. Act, the same cannot be availed of for evicting the lessee or tenant unless the same is also a ground for eviction under the one or the other clause of Section 21(1) of the Act. Similarly, even if Section 21(1) of the Act provides for a ground for eviction in a given case, the same cannot be availed of if the terms of lease between the lessor and the lessee guarantee a fixed period of lease or a permanent lease, unless of course, the lease deed also at the same time provides for termination of lease and recovery of possession on the breach of conditions of any of the terms. In fact, this aspect is dealt with by a Full Bench of this Court in SRI RAMAKRISHNA THEATRES LTD. vs GENERAL INVESTMENTS AND COMMERCIAL CORPORATION LTD., ILR 1992 KAR 1296 In the said case, this Court, on a consideration of the various Decisions of the Supreme Court and the earlier Decision of this Court, has held among other things, as under.

"It is unnecessary to multiply the citations as we do not find any other Decision which is quite relevant to the question raised before us. The meaning attributed to the non-obstante clause in sub-section (1) of Section 21 of the Act in Bharath Petroleum Corporation's case (AIR 1986 Kar.191 : ILR 1984 (2) Kar.401) is not correct; the overriding effect of the said clause is limited to the subject referred to immediately by the words following in otherwords, even if any other law or contract provides for recovery of possession of the same shall be of no effect and the eviction can be made only on the grounds stated in clauses (a) to (p) of the proviso. This indicates that the landlord should have a right to recovery possession and that right cannot be held to vest in him during the period of the term lease unless there is something in the lease deed which provides for the determination of the lease; in such a situation, even after the determination of the lease in the manner stated in the term lease, the recovery of possession will have to be made only by recourse to Section 21(1)".

We hasten to add here that this Court in the said case was concerned with the question as to whether a landlord is entitled to seek eviction of a tenant who is holding the leasehold premises as a lessee under a term lease, before the expiry of the period of lease when there is no provision for the forfeiture of lease in the lease deed. However, in our view, the ratio laid down in the said case, would mutatis mutandis apply even to a case where the lease is of a permanent nature. In the instant case, the lease deed dated 18.6.1917 is styled as a permanent lease. However, it is also noticed that there is a bar for alienation. In the context of the ratio laid down in the aforesaid case, it is clear that even though there is a bar for sublease in the lease deed and the same would result in forfeiture of lease, the same cannot be a ground for eviction under Section 21(1) of the Act. Section 2(1)(f) of the Act reads as under:

"Protection of tenants against eviction:-

(1) Notwithstanding anything to the contrary contained in any other law or contract, no order or decree for the recovery of possession of any premises shall be made by any Court or other authority in favour of the landlord against the tenant:

Provided that the Court may on an application made to it make an order for the recovery of possession of a premises on one or more of the following grounds only, namely:-

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(f) that the tenant has unlawfully sublet the whole or part of the premises or assigned or transferred in any other manner his interest therein and where the subletting, assignment or transfer has been made before the coming into operation of this part (except in respect of subletting, assignment or transfer to which the provisions of Section 61 are applicable), such sub-letting, assignment or transfer has been made contrary to any provision of law then in force."

It is necessary to state here that Section 21(1) (f) cannot be read in isolation and the same will have to be read in conjunction with Section 23 of the Act. Section 23 reads as under:-

"Tenant not to sub-let or transfer after commencement of this part- (1) Notwithstanding anything contained in any law, but subject to any contract to the contrary, it shall not be lawful after the coming into operation of this part, for any tenant to sublet whole or any part of the premises let to him or to assign or transfer in any other manner his interest therein.

Provided that the State Government may, by notification, permit in any area the transfer of interest in premises held under such leases or class of leases and to such extent as may be specified in the notification:

Provided further that nothing in this section shall apply to a tenant having a right to enjoy any premises in perpetually.

(2) Any person who contravenes the provisions of sub-section (1), shall, on conviction, be punished with fine which may extend to one hundred rupees."

The provisions of Section 21(1)(f) and Section 23(1) of the Act will have to be understood in a correct perspective. While Section 21(1)(f) provides that 'unlawful subletting' is a ground for eviction. Section 23(1) stipulates as to what 'unlawful subletting' is. In the context of Section 23(1) it becomes clear that it is not every subletting that is 'unlawful', but subletting without the consent of landlord which is made 'unlawful'. Further the second Proviso to Section 23(1) makes it clear that para-1 of Section 23(1) shall not apply to a tenant having a right to enjoy any premises in perpetuity. In other words para-1 of Section 23(1) will not have any application to a permanent tenant.

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23. Ex.P.1, as pointed out earlier, is an instrument relating to the lease in question. The same came into being on 18.6.1917. The same clearly recites that since the lessees wanted a permanent lease, the lessor agreeing to the same has given the properly on perpetual and permanent lease subject to the conditions enumerated therein. Further it is noticed that the rent fixed is Rs.58-2-0 per year in cash, 50 big Malgoa mangoes of the value of Rs.3/- and 50 Raspuri mangoes. Further the deed recites that the lessees should enjoy the property from generation to generation. It is also recited therein that if there is any increase in the assessment of the land by the Government, the same will have to be paid by the lessees to the lessor. Further there is also a stipulation that the lessees are not merely personally liable to pay the enhanced assessment, rent and the interest on arrears of rent but even a change is created on the leasehold property as also on the crops. It is also noticed that there is a forfeiture clause with reference to the failure to pay the arrears of rent and interest thereon as also with reference to alienation. It is also noticed that there is a right of re-entry also in the event of forfeiture of the lease. Further, it is noticed that the rent is fixed. Then again there is a recital to the effect that as long as lessees and their progenies go on enjoying the properties, fulfilling the conditions adumbrated above, the lessor or his representative will not have any right either to demand more rent or to demand the surrender of the lease. There is also a recital to the effect that the lessees and their progencies have no rights to demand the reduction in the rate of rent.

24. It is in the context of the aforesaid recitals that the Court is required to assess the nature of the lease. As pointed out earlier, the main thrust of the submission of Sri Raghavendra Rao, learned Counsel for the petitioners was on the existence of the forfeiture clause and the right of re-entry. According to Sri Raghavendra Rao forfeiture clause coupled with the right "of re-entry destroys permanency or perpetuity of the lease in question, notwithstanding the fact that the lease deed describes the lease as permanent and perpetual. Sri Raghavendra Rao is right in contending that the existence of a forfeiture clause with a right of re-entry in a lease deed is indeed a relevant factor which will have to be taken into consideration for assessing the nature of the lease. However, as pointed out earlier, it is not just one or two factors which should enter into the Judicial verdict. In our view, the fact that the lease is made hereditary, the fact that the lessees themselves will have to pay the enhanced assessment, the fact that the lessor or his representative has no right to increase the rent, the fact that the leasehold property and the crops grown thereon are made a charge towards the liability to pay rent and enhanced assessment and the fact that the lessor and his representative have no right to demand the surrender of the lease as long the conditions are fulfilled, are indeed the factors which would overwhelmingly militate against the plea that the lease is not a permanent one. In our view, in the context of these factors which can be spelt out from the recitals of the instrument of lease itself, the mere fact that the lease deed contains a forfeiture clause with a right of reentry in the event of non-payment of rent or alienation of the property, by itself, will not make the lease non-permanent. It is not as if permanent lease cannot contain a forfeiture clause at all. In other words, forfeiture clause with right of re-entry is not conclusive to hold that the lease is not permanent, though the said clause is indeed one of the relevant factors which will have to be taken into consideration while deciding the question as to whether the lease is permanent or not. It is also relevant at this juncture to refer to certain Decisions which have a bearing on this aspect In the Decision in BHAGWATI PRASAD AND ORS. v. BALGOBIND AND ORS, AIR 1933 Oudh 161 11. AIR 1933 Oudh 161 . Among other things, it is held as under:

"The lease under consideration does not cease to be a lease in perpetuity simply because, it contains the forfeiture clause in question. The forfeiture clause in question does not affect the permanency of the tenure as long as the annual rent is paid. The provision for the forfeiture of the lease for non- payment of rent was intended merely as security for the payment of rent."

Then again, in the Decision in R.S. RAMMOHANRAI JASWANTRAI DESAI AND ORS. v. SOMABHAI NATHABHAI PATEL AND ORS. Their Lordships of the Bombay High Court have, among others, held as under:

"Under the decree Bhika Parshottam became a tenant for an indefinite period. In accordance with the above decisions, it will therefore have to be held that he was a life tenant, unless it can be shown that the terms of the lease contained in the decree, the surrounding circumstances and the subsequent conduct of the parties indicate that there was an intention to grant a perpetual lease. In support of his arguments Mr. Desai has first relied on the fact that the word "defendant" is used in singular and that there are no words of inheritance and no reference to heirs or legal representative of Bhika Parshottam in the decree. But as pointed out in KOOLDEEP NARAIN SINGH v. THE GOVERNMENT, 14 M.I.A 247 at P. 255 : (11 Beng. L.R. 71 P.C.), the omission of words of inheritance does not show conclusively that the lease was not hereditary. See also BABU v. SITARAM 3 Bom.L.R. 768. Mr. Desai also relied on the provision in the decree about the rendering of service and stated that this showed that there was no intention to create a hereditary interest in the lease. The service to be rendered was that the tenant was to drive the landlord's cart and bullocks on two occasions in a year. This is not service of a kind which could be rendered by Bhika Parshottam alone. It could equally well be rendered by any other person.

Consequently this provision does not necessarily suggest that only a life estate was intended to be granted. The other circumstances on which Mr. Desai relied is the prohibition on alienation of the leasehold rights. This undoubtedly is a circumstance in favour of the plaintiffs. But, as pointed out in Bhabataram v. Trailokyanath, 59 Cal. 1282 (AIR (19) 1932 Cal. 764) such a provision does not militate against the permanent character of the tenancy. Mr. Desai also invited our attention to the form in which receipts for rent were issued from 1923 to 1936. in each of these receipts it is stated that the land had been taken on lease for one year. But these receipts were passed by the plaintiffs and any statement made therein would not, therefore, bind the defendants. Also, as I have mentioned above, the plaintiff's story that Bhikha Parshottam had given up his rights under the decree and had, become an annual tenant has not been accepted by the lower Courts. There are in this case other circumstances which, in our opinion, clearly indicate that something much more than a lease to enure only during the lifetime of Bhika Parshottam was intended. The suit in which the above decree was passed was filed by the plaintiff's ancestors for recovering possession of survey No. 174 from Bhika Parshottam, who as stated in the plaint, had been cultivating it since several years. Bhika Parshottam then contended that he was a permanent tenant. The suit ended in a compromise decree, and although a specific contention had been raised by the defendant Bhika Parshottam that he was a permanent tenant, the decree is silent as to the duration of the tenancy. Bhika Parshottam was 60 years old in 1911 when the suit was filed. His expectation of life at that time could not have been more than a few years. The decree makes provision for a revision of the rent every 12 years. This strongly suggests that the parties intended that the tenancy should continue even after Bhika Parshottam's death. Another circumstance indicating a permanent grant is the provision giving the tenant a right not only to 2/3rds share of the fruits of fruit bearing trees, but also to 2/3rds share in the wood of ail trees. The subsequent conduct of the parties leads to the same conclusion. Bhika Parshottam died in 1927 leaving behind two sons, Chatur and Nathabhai. The plaintiffs did not then resume possession of the land, but allowed Chatur to continue as tenant. Chatur died in 1936-37 and since then the present defendants have been in possession of the land. Defendant-1 is the son of Nathabhai, while defendants-2 and 3 are the sons of Chatur. The land has, therefore, been in the possession of Bhikha Parshottam's family for atleast three generations. The only inference that can be drawn from these circumstances is that the lease was not intended to come to an end on Bhika Parshottam's death, but was intended to operate as a perpetual lease, which could be terminated, as provided in the decree, only if there was default in the payment of rent or if the rights conferred by it were alienated.

After a careful consideration of all the circumstances, we are, therefore, of the opinion that a hereditary interest in the lease was created by the compromise decree, which was passed in 1912, and that the defendants are, consequently permanent tenants in respect of 14 3/4 bighas out of Survey No. 174."

13.6 It was submitted that a permanent lease without a forfeiture clause, creates a contractual tenancy, which would be governed by the Transfer of Property Act and not by the Rent Act (barring section 12 thereof) and that therefore, there cannot be eviction from such tenancy. In other words, the period of subsisting permanent lease cannot be curtailed in the absence of a forfeiture clause. In support of such submission, the learned counsel placed reliance upon the decision of this court in Legal Heirs of Deceased Fakir Chand Ambaram Patel v. OL of Amruta Mills Ltd. and others, 2002 (3) GLH 367, wherein, the court held that it is settled law that the period of a subsisting lease cannot be curtailed in absence of a forfeiture clause in the lease deed. The contractual tenancy would thus subsist as governed by provisions of the T. P. Act and there cannot be any eviction from such tenancy.

13.7 It was submitted that any ground contained in the lease deed other than or in addition to the grounds enumerated in section 13(1) of the Rent Act, shall remain inoperative during subsistence of lease, and even after expiry of lease term. Thus, when the lease deed in question is not for any fixed term, then in that case, the ground of non-payment of rent for the purpose of re-entering the possession, which is not prescribed in section 13 of the Rent Act, shall remain inoperative all throughout. In support of such submission, the learned counsel placed reliance upon the decision of a Division Bench of this court in Jabal C. Lashkari v. Official Liquidator of Prasad Mills Ltd., (supra), wherein, the court held that any ground contained in the agreement of lease other than or in addition to the grounds enumerated in sub-section (1) of section 13 of the Rent Act shall remain inoperative during subsistence of the lease and even after expiry of the lease term.

13.8 Reliance was also placed upon the decision of the Mysore High Court in Ramacharya Narayana Charya Burli and another v. State, AIR 1965 Mysore 1, wherein, the court held thus:

"2. When R. A. No. 22 of 1959 which involves the question as to the apportionment of compensation between the appellants representing the landlord's interest and the respondents representing the tenant's interest was argued before a Division Bench, the two decisions mentioned in the question referred to the Full Bench were relied upon by Mr. V. Krishna Murthi as laying down the correct ratio of apportionment of compensation between the landlord and the tenant and prays for a decision of the appeal on that basis. But Mr. Jagirdar for the Respondents drew the attention of the Bench which heard the appeal to a decision of the Privy Council in Rakhal Chandra v. Secretary of State, AIR 1929 PC 113 and that of the Supreme Court in Vithal Yeshwant v.

Shikandarkhan, AIR 1963 SC 385 which, do not appear to accord with the decisions of this Court. Hence the reference to a Full Bench.

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6. Incidents of proprietary rights of ownership enumerated in R.A. 161 of 1955 as requiring confederation in favour of the landlord fall into two categories. The right to possible contingent reversion and the right to enhance rent normally depend upon the terms of contract of lease while the right to minerals and the right of resumption in case the land is a service inam, depend upon the terms of the grant made by the Government in favour of the Inamdar or the Watandar. Therefore if the landlord claims enhanced share in the Compensation amount in respect of rights arising under or relating to the contract of lease, be has to set up and prove what are all the special considerations which weigh in awarding him a higher share in the compensation. In respect of rights which are incidental to the tenure of the grant in his favour or to the property held by him which should eater into a determination of the market-value of the property under 23 and 24, he has to put forward his claims before the Land Acquisition Officer and substantiate the same by proper evidence. If he fails to put forward his rights to the mineral or other sub-soil rights before the Land Acquisition Officer it would be unfair to allow him to make such a claim only at the time of apportionment of compensation between himself and his tenant. He must also establish his right to get the rent enhanced. Further his right to reversion before it can be taken into consideration should not be so remote as to be valueless.

7. The various authorities cited at the Bar or both the parties disclose that the valuation of a possible contingent right of reversion is a matter dependent upon the facts and circumstances of each case, or upon the terms of contract of tenancy between the landlord and the tenant, or the tenancy lights as may be declared by any law in force. In Sadasheorao v. Collector Nagpur, AIR 1942 Nag 86 it was recognised that the apportionment of compensation between the landlord and tenant has to be made according to their several interests in the land and that "what those interests are can only be ascertained by the evidence in each case". Vivian Bose, J. laid down that when there is no evidence it is only possible to follow the rough and ready rule. In stating this proposition reference was made to the decision in Shiam Lal v. Collector of Agra, AIR 1534. All 239 (FB) which enumerated the various points in favour of the Zamindar and of the tenant that are required to be taken into consideration in apportioning the amount of compensation.

"The Full Bench considered the previous decisions of that High Court and the rights, of the Zamindars in general and the occupancy rights of tenants and laid down that in the absence of any specific evidence as to custom, practice or agreement, the fair ratio of distribution of the compensation awarded for agricultural land as between the Landlord on the one hand and the occupancy tenants and the other was ten annas in a rupee to the land-Lord and six annas in a rupee to the tenants. If may be noted that this rough and ready ratio was fixed on the basis that the incidents enumerated in the decisions exist.

In AIR 1929 P.C. 113 the Privy Council held that the value of the landlord's chance of receiving back the land was nothing since from the terms of the lease deed and the Act passed by the Government the College had been put on a permanent basis and there was no chance for the landlord to receive back the land particularly when the option to surrender depends upon the lessee. In Sakariyawo Oshodi v. Mariamo Dakolo, AIR 1930 PC 261 the Privy Council held in an appeal from Nigeria, that the land should be given 'some small portion' of compensation in respect of his reversionary right. What the value of such right would be or how it should be calculated, has not been indicated in that decision. In that case it appears that the occupant had no right of alienation. If the tenancy right is both heritable and alienable, the value of the right of reversion may be nothing.

Before the Madras High Court in Natesa Aiyar v. Kaja Maruf Sahib, AIR 1927 Mad 489 the question was one of apportionment of compensation between the melwaramdar (landlord) and kudivaram. It held that the valuation of the former's interest at 20 years purchase of the rent would be unfair and referred to some other interests like the right to recover the land from the tenant and the right of forfeiture in case of denial of title. The decision, however, proceeded on the ground that the interest of the Kudivaramdar was merely one of occupation of the lands for cultivation or for utilising it for the purpose for which he had taken it on lease. Beyond laying down that the rights of persons 'are somewhat indefinite' their Lordships did not lay down any principle as to how and when the possible right of recovery of the land could be valued in apportioning the compensation.

The Kerala High Court, in Krishna Menon v. Raman Unni, AIR 1961 Ker 140 (FB) considered the question of apportionment with special reference to Malabar Tenancy Act and laid down that in the context of the Tenancy Act the possibility of the landlord recovering possession should not be ignored. The Bombay High Court also considered the question of reversionary right in Dossibaj's case 60 Bom LR 1208 referred to above and observed that

-

"In assessing the value of the reversion, the court cannot consider it as a mathematical problem but must take a broad and practical view and that valuation should be fixed by considering what the owner might obtain if the land were sold subject to the claims of the permanent tenant whose lease was to last for 198 years".

It would thus be obvious from these decisions that the right of reversion cannot be taken into consideration as a hypothetical consideration in all cases but should be taken into account where the terms of the lease disclose reasonable possibility of the landlord getting back the land.

21. Hence the arguments before this full Bench have been devoted to the questions - (i) whether in cases of permanent tenancy with no right to the landlord to enhance the rent the landlord is entitled to anything more than the capitalised value of the rent reserved by the lease out of the compensation awarded for compulsory acquisition of the land subject to the tenancy, and (2) whether and if so which of the considerations adverted to or relied upon in the judgments of this Court in R.A. 161 of 1955 and R.A. 34 of 1955 can be said to be irrelevant.

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26. Taking up the first of the propositions, viz. whether in the case of a permanent tenancy with no right to the landlord to enhance the rent the landlord is entitled only to a capitalised value of the rent calculated on a just and reasonable formula, it is obvious that the said proposition should be correct only on the basis that the one and only right which belongs to the landlord is the right to receive rent at a certain fixed and invariable rate. Unless it is clearly established that such is the only right of the landlord in the circumstances of the case, either on the basis of agreement i.e. a the terms of the lease, or on the basis of any custom, i.e., any incident or incidents annexed to contracts by local custom, or on the basis of any statutory law regulating the mutual rights of landlords and tenants or controlling their separate rights, as for example, a law relating to treasure-trove or a law declaring the rights of the Government to minerals or controlling the rights of individual owners in the matter of exploitation of minerals, the clear legal inference would be that an owner of the land retains-to himself all rights in respect of the land other than those which he has transferred under the lease to his tenant.

It is no doubt true that the right to receive rent is the most important right in terms of monetary advantage. But other advantages of ownership which in conceivable circumstances may take the shape of or result in actual monetary benefit to an owner cannot in ordinary circumstances be wholly discounted. The very legal conception of a lease is a transfer or right to enjoy the property in consideration of money, share of crops, service or any other thing of value to be rendered periodically, - such return for the enjoyment being called rent. In the absence of a contract or local custom to the contrary, the enjoyment of the property by the lessee is limited to the purpose of the lease and he cannot use the property for a purpose other than that for which it was leased or fell or self timber or work mines or quarries not open when the lease was granted or do any act which is destructive or permanently injurious to the property. It means therefore that ordinarily the right to enjoy the property transferred to the lessee under a lease is not in the contemplation of law necessarily exhaustive of all the rights of the lessor in the property.

Consequently, the rent which is the return made by the lessee for the right of enjoyment transferred to him cannot represent the value of the enjoyment of all the rights of the lessor in the land. In other words, capitalised value of rent cannot be equated to the value of all rights of the lessor. To hold otherwise would mean that a permanent lease with a fixed rent is in no respect different from an actual sale of the land the sale price being treated as a permanent loan by the lessor to the lessee but irrecoverable at the instance of the lessee subject only to a permanent liability of the lessee to pay a permanently fixed amount by way of interest."

It was submitted that in the facts and circumstances of the present case since the rights of the parties are governed by a permanent/perpetual lease, the provisions of the Rent Act would not apply.

13.9 It was submitted that section 13 of the Rent Act provides that notwithstanding anything contained in the Act, but subject to the provisions of section 15, a landlord is entitled to recover possession of any premises, if the court is satisfied regarding any of the contingencies enumerated therein. It was submitted that section 13 of the Rent Act, therefore, is subject to the provisions of section 15 thereof, which in turn is subject to any contract to the contrary. It was submitted that the lease deed of 1911 creates a permanent and contractual tenancy and hence, Jubilee Mills is a contractual tenant and not a statutory tenant.

13.10 Insofar as the lease deed of 1983 between Calico Limited and Jubilee Mills not being a registered agreement is concerned, the learned counsel placed reliance upon the provisions of section 53A of the Transfer of Property Act. It was submitted that section 53A of the Transfer of Property Act envisages the doctrine of part performance. It was submitted that Ahmedabad Manufacturing has transferred its leasehold rights in the subject property to Calico Limited, who is turn has transferred its leasehold rights to Gaurav Chemtex/Jubilee Mills under the agreement of 1983. It was submitted that Jubilee Mills Ltd. had performed its part of contract under the agreement of 1983, and hence, the doctrine of part performance would be attracted in the present case. Therefore, considering the fact that the agreement of 1983 is not a registered document, Jubilee Mills may not be in a position to file a suit based on the agreement, it can certainly rely upon the document in its defence under the proviso to section 49 of the Registration Act. It was contended that section 53A of the Transfer of Property Act enables Jubilee Mills to use the deed of 1983 as a shield to protect its possession, though it may not be able to claim title on that basis. Therefore, non-registration of the agreement of 1983 will not give rise to any right in favour of the original lessor to take possession from Jubilee Mills.

13.11 As regards the contention that the Official Liquidator cannot sell the leasehold rights, the learned counsel submitted that the provisions of the Rent Act have to be interpreted harmoniously. It was pointed out that section 19 of the Rent Act makes an exception in the case of the proviso to section 15(1) thereof which permits sub-letting in case where the State Government, by notification in the Official Gazette, permits in any area the transfer of interest in premises held under such leases or class of leases and to such extent as may be specified in the notification. It was submitted that since the State Government has issued notification under section 15(1) of the Rent Act, it is lawful for the Official Liquidator to sell the leasehold rights.

13.12 Referring to the lease deed of 1911, the learned counsel submitted that the lease does not refer to any specific period and says that till the lessee continues to pay the rent, there is no question of possession. It was submitted that under the clauses of the lease deed, option is given to the lessee to surrender the lease if he so desires but no option has been given to the lessor. Moreover, there are no specific clauses in the lease deed dealing with forfeiture of the lease. It was urged that reading the clauses harmoniously, it is evident that the nature of the lease is permanent/perpetual. In support of such submission, the learned counsel placed reliance upon the decision of the Calcutta High Court in A. Caspersz v. Kader Nath Sarbadhikari and Others, (1901) 28 ILR 738 (Cal), wherein, the court held that the fact that the landlord had permitted a pucca house to be built upon the land by the tenant, which house has stood for a very considerable time, raises a presumption that the original grant was some kind of permanent building grant. It was submitted that the lease deed of 1911 permits the lessee to construct buildings on the subject property; therefore, the presumption is that it is a permanent lease.

13.13 Reliance was also placed upon the decision of the Privy Council in Mt. Afzal un. Nissa v. Abdul Karim and Others, AIR 1919 Privy Council 11, wherein, reliance was placed upon the above-referred decision of the Calcutta High Court in A. Caspersz v. Kader Nath Sabbadhikari (supra). Strong reliance was placed upon the decision of the Supreme Court in Sivayogeshwara Cotton Press v. M. Panchaksharappa, AIR 1962 SC 413, wherein the court held thus:

"8. Addressing ourselves to that question, it is clear on a construction of the document Ex-I that it was a lease of the demised premises for a term of 20 years certain, on payment of Rs 350 annual rent in advance, even though the lessee may not continue to occupy the demised land; that the lessee had been granted a right to continue the lease of the demised premises as long as the lessee desired to do so; that on his choosing to continue to enjoy the leasehold, the lessee was obliged to pay annually the enhanced rent of Rs 400 for the next ten years after October 1, 1934, and after the expiration of the ten years aforesaid, the rent was further enhanced to the sum of Rs 500 per annum; that the lessee was given the option to give up the lease at any time after October 1, 1934, without any further liability for payment of the stipulated rent; that (and this is a very important stipulation) the lessor bound himself not to call upon the lessee at any time to give up possession of the lease-hold as long as the lessee was prepared to observe the terms of the lease; that the lessee was fully authorised "to erect, as many buildings, godowns, factories, bungalows and other structures etc." as also to pull down and re-erect structures or to make any alterations, as desired by him;

that the lessor undertook not to raise any objection to the lessee making those structures or his using or enjoying the land in any way or for any purposes according to his desire; that the lessor undertook to pay the annual assessment to the Government in respect of the demised premises but the lessee was obliged to pay all fines and other taxes which the Government might impose for granting permission to convert the culturable land into land meant for building factories and other structures as contemplated between the parties that if the lessee chose to give up possession of the demised premises, he shall be entitled to take away all machinery, iron and steel, woodworks etc. of the factories, buildings and other structures that may be standing; that in the event of a default in the payment of the annual rent fixed as aforesaid, upon notice of demand served upon the lessee, the lessor reserved the right to retake possession of the demised land. The lessee was also declared by para 10 quoted above to be always entitled to sublet or relet the demised/land to any person and on any terms. As the lease was apparently for the purpose of converting agricultural land into factory premises necessary for running the factory, it was specifically provided that if the Government refused to give the necessary permission for setting up the factory, the lease shall he deemed to be cancelled Para 13 also contains a stipulation that the heirs and assigns of the lessor shall have no right to disturb the lessee in peaceful possession of the demised premises, and that in the event of any such interference, the lessee shall be entitled to claim damages for the loss suffered by any action on the part of the lessor or his heirs or successors. Para 14 is also a very important clause in the lease deed, which though coming as the last clause, must govern all the stipulations between the parties. Thus the terms and conditions of the lease which created the rights and obligations between the lessor and the lessee were specifically declared to be binding on the heirs and successors-in-interest of the lessor and the lessee.

9. It is manifest, therefore, on a plain construction of the terms aforesaid of the lease deed that the purpose of the transaction was a building lease that though there was liberty reserved for the lessee or his successor to give up the lease-hold at any time after October 1, 1934, no corresponding right was reserved to the lessor. Thus there is no room for the controversy which has occupied a large portion of the judgments of the courts below, that reservation of the right to the lessee to surrender possession at any time, imported a corresponding right to the lessor to call upon the lessee to give up possession. It was an advantage specifically reserved to the lessee without any corresponding benefit to the lessor. It is equally clear that the lease was heritable and assignable. Thus there is no difficulty in holding that there is no room for the contention, on the terms of the lease, that the parties intended that after the lapse of the first 20 years of the lease, the tenancy will be merely a tenancy at will. It was clearly a tenancy for an indefinite period, at the least.

10. The contention on behalf of the appellant is that on a proper construction of the lease deed, read as a whole, the inference is clear that the parties intended it to be a permanent lease. The first argument in support of the conclusion we are asked to arrive at is that it is clearly a lease for building purposes; and it is rightly pointed out that where the land is let out for building purposes without a fixed period, the presumption is that it was intended to create a permanent tenancy. Reliance was placed upon the leading case in Navalram Shankardas v. Javerilal Govandram, 7 Bom LR 401, where Sir Lawrence Jenkins, C.J., laid it down that a presumption in favour of a permanent tenancy arises on a transaction like the one we have before us. The terms of the grant in that case are set out in full at p. 402 and it is clear on a reference to those terms that the deed was not as strong as we have in the instant case. Only two things were explicit in the terms of that document, namely, (1) that it was a lease for building purposes and (2) that as long as the lessee continued to pay the stipulated rent, the lessor would not be entitled to call upon the lessee to quit.

11. Reliance was also placed upon the decision of the Calcutta High Court in Promada Nath Roy v. Srigobind Chowdhry, ILR 32 Cal 648. In that case the Kabuliat did not specify any period during which the lease was to subsist. It has been stipulated that the land was to be held from year to year at an annual rent and that in the event of a masonry building being erected on the land, rent was to be assessed at the prevailing rate. Eventually, the tenant built the structure on the land. It was held by the Calcutta High Court that the parties contemplated the lease to be for building purposes and that therefore the court could presume that the lease was intended to be permanent. The terms of the lease in that case also were not as telling as in the case before us.

12. Similar was the case of Forbes v. Hanuman Bhagat, ILR 2 Pat 452, decided by a Division Bench of the Patna High Court which applied the decision of the Calcutta High Court in Promada Nath Roy v. Srigobind Chowdhry, ILR 32 Cal 648, to the case before it. That case was followed by a subsequent Division Bench in the case of CIT v. Maharajadhiraj Kumar Visheshwar Singh, AIR 1940 Pat 24. Fazl Ali, J., who delivered the leading judgment of the court relied upon the decision of their Lordships of the Judicial Committee of the Privy Council in the case of Raja Janki Nath Boy v. Dina Nath Kundu, since deceased, AIR 1931 PC 207. Mr Justice Fazl Ali particularly relied upon two circumstances which in his view supported the inference of the tenancy being permanent, namely, (1) that no term had been fixed in the lease and (2) that the lease deed contained provisions for the exercise of certain rights by the heirs of the lessor and the lessee, apart from the circumstance that the building was for enabling the lessee to build a gola (ware-house) and a platform for a rice mill. In all these cases decided by the Bombay, Calcutta and Patna High Courts as also by the Judicial Committee, there was no fixed period as the term of the lease.

13. But it was contended on behalf of the plaintiff- respondent that the term expressly granting the lessee the right to give up possession at will was wholly inconsistent with the permanency of the tenancy. In our opinion, the presumption raised by the fact that the lease was for building purposes and therefore intended to be permanent is not weakened by the fact that the lessee had stipulated with the lessor to be entitled to give up possession if and when he decided to do so. It is a right reserved in favour of the lessee and did not confer, as already pointed out, any corresponding right on the lessor. Such a right in favour of the lessee cannot be converted into a disability or an obligation which should detract from the grant of a permanent tenancy. Such a stipulation which gives a right to the tenant to surrender the lease- hold at any time he decided to do so, if it is coupled with a corresponding right in the landlord to serve notice of ejectment at any time he chose to do so may have the effect of making the tenancy, a tenancy at will, but such a conclusion has been negatived by the High Court and rightly enough."

13.14 Reference was made to the decision of the Supreme Court in Modern Hotel v. K. Radhakrishnaiah, (1989) 2 SCC 686, wherein the court held thus:

"4. Two contentions have been advanced by Mr P.P. Rao appearing for the appellant to maintain that the order of eviction was contrary to law and cannot be sustained. Reliance is placed on Section 7 of the Andhra Pradesh Buildings (Lease, Rent and Eviction) Control Act, 1960, (hereinafter "Act") in support of the stand that the sum of Rs 5000 which lay as advance in the hands of the respondent landlord was either refundable to the tenant or adjustable against rent and if out of the sum of Rs 5000 the arrears were available to be adjusted, the tenant was not at all in default. It has next been contended that the lease of 1969 was for a term of 30 years certain and eviction has been claimed against a contractual tenant during the subsistence of the lease. Admittedly, the lease does not have a forfeiture clause so as to bring the matter within the ambit of Section 111(g) of the Transfer of Property Act. The application for eviction, a copy of which is available on the record (at p. 10 of the second paper book), refers to a notice in para 7 in the following terms:

"The petitioners caused a registered notice through their counsel dated 28-10-1973 to the respondent demanding the rent due and also for the eviction from the schedule mentioned premises since the respondent has become a wilful defaulter. The respondent received the notice and has not chosen to give any reply."

It, therefore, follows, appellant's counsel has contended, that the lease remained unterminated and the right created under the lease cannot be taken away by filing an application for eviction on the plea of wilful default in the matter of payment of rent."

"11. The second contention advanced before us is equally weighty. The lease being for a term of 30 years is to expire in September 1999. As we have already said, the lease did not stipulate a forfeiture clause and in the absence of a forfeiture clause in the lease leading to termination by forfeiture, the contractual tenancy was subsisting under the provisions of the Transfer of Property Act and there could not be any eviction from such a tenancy."

It was submitted that the present case, factually fits in the four corners of this judgment.

13.15 Reliance was placed upon the decision of the Patna High Court in A. H. Forbes v. Hanuman Bhagat and Others, AIR 1924 Pat 88, wherein, the court held thus:

"4. Two questions were agitated in the Court below, namely:-

(1) Whether the lease in favour of the defendants was a permanent lease in its inception, and (2) Whether the subsequent acts and conduct of the lessor and the lessees converted the lease into a permanent one and if so, whether the plaintiff lessor is therefore estopped from bringing a suit for khas possession of the land in suit. The Court below has decided both to issues against the plaintiff. Mr. Sen on behalf of the appellant impugns the finding of the Court below on both the issues. Now the plaintiff's suit will fall if any of the aforesaid issues is decided against him. The first issue depends upon the construction of the document in question. It is conceded that no definite term was fixed in the lease. That in itself will not show either that the lease was of a permanent character or that it was for a term of year. As to whether this indefinite term was intended to be perpetual or permanent depends upon the intention of the parties as gathered from the covenants in the lease. The learned Subordinate Judge has in his judgement summarised the terms. It is not necessary to refer to all of them for the purposes of this appeal. We may, however, refer to the following terms only:-

(1) The purpose of the lease was to enable the lessee to erect Gola house and to purchase and sell all sorts of commodities therein, or in other words to open his business therein;

(2) The lease was not limited for any definite period but that it was a bemaiyadi lease or a lease without any term;

(3) ... That the lessee shall not have the power to construct any pucca building without the express and written permission of the lessor and if that stipulation be violated and pucca building be raised by the lessee without such permission of the lessor, he, the lessee shall be liable to be evicted; and (4) ... In case the lessee wants to erect pucca building and to have a pucca well or Indara he shall have to do so according to the advice of the lessor.

5. Now it is clear from the aforesaid terms that the lease was for the purpose of gola business and for building houses. It is also clear that the erection of pucca buildings for the business as well as for the purpose of residence was in the contemplation of the parties with the condition that permission for erecting pucca structures will have to be taken from the lessor. Under these circumstances, the inference is not unreasonable that the lease in question was meant to be of a permanent character and not from year to year. No doubt, as observed, a bemaiyadi lease or a lease without any term may in the circumstances of a particular case be shown not to confer any permanent grant as was held in the cases relied upon by the learned counsel on behalf of the appellant: Baroda Prasad v. Prasanna Kumar; Mahim Chandra v. Anil Bandhu, Parshen Kuer v. Tulsi Kuer, and Kailaspati Choddhury v. Muneshar Choudhury. The decisions in those case were applicable to the particular facts decided and the leases concerned. The present case is very near the case reported as Promoda Nath Roy v. Sri Govind Choudhury. Upon the facts in the present case and the lease in question we are not prepared to differ from the view of the Court that at its inception the lease was a permanent lease, and not one from year to year."

13.16 It was submitted that considering the principles laid down in the above decisions, it is evident that the lease of 1911 is a permanent lease and not a lease from year to year. It was submitted that for the purpose of considering whether the parties would be governed by the Rent Act or the covenants of the contract between the parties, the character of relationship between the lessor and lessee has to be seen. It was submitted that the provisions of the Rent Act will be excluded because there is a contract to the contrary between the parties, and, therefore, the tenancy in question is a contractual and not a statutory one.

13.17 Reliance was also placed upon the decision of a Full Bench of the Karnataka High Court in Sri Ramkrishna Theatres Ltd. v. General Investments and Commercial Corporation Ltd. and Others, AIR 1993 Karnataka 90, wherein, the court held thus:

"19. Again, coming to the Gian Devi's case, the following observations made at page 812 are to be noted:

".... These decisions correctly lay down that the termination of the contractual tenancy by the landlord does not bring about a change in the status of the tenant who continues to remain in possession after the termination of the tenancy by virtue of the provisions of the Rent Act. A proper interpretation of the definition of tenant in the light of the provisions made in the Rent Acts makes it clear that the tenant continues to enjoy an estate or interest in the tenanted premises despite the termination of the contractual tenancy.

Accordingly, we hold that if the Rent Act in question defines a tenant in substance to mean a tenant who continues to remain in possession even after the termination of the contractual tenancy till a decree for eviction against him is passed, the tenant even after the determination of the tenancy continues to have an estate or interest in the tenanted premises and the tenancy rights both in respect of residential premises and commercial premises are heritable. The heirs of the deceased tenant in the absence of any provision in the Rent Act to the contrary will step into the position of the deceased tenant and all the rights and obligations of the deceased tenant including the protection afforded to the deceased tenant under the Act will devolve on the heirs of the deceased tenant."

The tenant's estate or interest in the tenanted premises is a valuable right and, if so, such an estate or interest cannot be defeated by interpreting the Act in a particular manner when the words used in the Act specifically do not provide for the taking away of the estate or interest vested in the tenant. One more decision which is very relevant is the one reported in Modern Hotel, Gudur v. K. Radhakrishnaiah, AIR 1989 SC 1510. The tenant therein was a term lessee. An action for eviction was initiated against the tenant in the plea that the tenant had failed to pay the rent for a certain period. There was an order of eviction which was affirmed by the Supreme Court. The Supreme Court held that the action was not maintainable because:

"......It has next been contended that the lease of 1969 was for a term of 30 years certain and eviction has been claimed against a contractual tenant during the subsistence of the lease. Admittedly, the lease does not have a forfeiture clause so as to bring the matter within the ambit of S. 111(g) of the Transfer of Property Act. The application for eviction, a copy of which is available on the record (at p. 10 of the second paper book), refers to a notice in paragraph 7 in the following terms:

"The petitioners caused a registered notice through their counsel dated 28-10-1973 to the respondent demanding the rent due and also for the eviction from the schedule mentioned premises since the respondent has become a wilful defaulter. The respondent received the notice and has not chosen to give any reply".

It, therefore, follows, appellant's counsel has contended, that the lease remained unterminated and the right created under the lease cannot be taken away by filing an application for eviction on the plea of wilful default in the matter of payment of rent."

This contention was accepted by the Supreme Court at page 1513, thus:

"......The lease being for a term of 30 years to expire in Sept., 1999. As we have already said, the lease did not stipulate a forfeiture clause in the lease leading to terminating by forfeiture, the contractual tenancy was subsisting under the provisions of the Transfer of Property Act and there could not be any eviction from such a tenancy."

20. From the above it is clear that while the contractual tenancy subsists, the Rent Control Act cannot be applied to evict the tenant. The observation of the Supreme Court is not based on any particular provision of the relevant Andhra Pradesh Rent Control Act but is based on the principles flowing out of the provisions of the T. P. Act and the interest created in the tenant under a term lease. Mr. A. G. Holla, learned Counsel for the petitioner, however, very fairly brought to our notice that term leases were excluded from the ambit of the Andhra Pradesh Act. But the learned Counsel also rightly contended that the decision of the Supreme Court is not based on any such provision because such provision was not noticed in the decision of the Supreme Court as a ground for the above observation.

21. It is unnecessary to multiply the citations as we do not find any other decision which is quite relevant to the question raised before us. The meaning attributed to the non obstante clause in Sub-Section (1) of Section 21 of the Act in Bharath Petroleum Corporation's case is not correct; the overriding effect of the clause in Sub-Section (1) of S. 21 of the Act is limited to the subject referred to immediately by the words following. In other words, even if any other law or contract provides for recovery of possession the same shall be of no effect and the eviction can be made only on the grounds stated in clauses (a) to (p) of the proviso. This indicates that the landlord should have a right to recover possession and that right cannot be held to vest in him during the period of the term lease unless there is something in the lease deed which provides for the determination of the lease; in such a situation, even after the determination of the lease in the manner stated in the term lease, the recovery of possession will have to be made only by recourse to Section 21(1). "

13.18 Reliance was placed upon the decision of the Supreme Court in Laxmidas Bapudas Darbar v. Rudravva, (2001) 7 SCC 409, wherein, the court held thus:

"15. It has nowhere been held that by virtue of the provisions of the Rent Act the contract of term lease is completely obliterated in all respects. The effect of the Rent Act on tenancy under contract has been considered only to a limited extent, confining it to the necessity of giving notice under Section 106 of the Transfer of Property Act.

16. Next we may consider the decision in the case of Shri Lakshmi Venkateshwara Enterprises. It was a case relating to a term lease of 32 years. In para 5 it has been observed as follows:

"5. This court in V. Dhanapal Chettiar v. Yesodai Ammal, (1979) 4 SCC 214, categorically laid down that contractual tenancy will lose its significance in view of the Rent Control Act. In that case, even the notice under Section 106 of the Transfer of Property Act was held to be a surplusage. It is, therefore, urged that if a landlord could found an action on any one of the enumerated grounds under Section 21 of the Act, the action would be maintainable notwithstanding the existence of a contractual lease."

The above observations have been made by referring the decision in Dhanapal Chettiar case without taking into account the context in which Chettiar case was decided. The Court then proceeds to consider Section 21 of the Act which reads as under:

"21. Protection of tenants against eviction.-- Notwithstanding anything to the contrary contained in any other law or contract, no order or decree for the recovery of possession of any premises shall be made by any court or other authority in favour of the landlord against the tenant:

Provided that the court may on an application made to it, make an order for the recovery of possession of a premises on one or more of the following grounds only, namely--

* * *"

(emphasis supplied)

On the basis of the above provision it has been observed that anything contained to the contrary, in any contract cannot prevail.

17. It may have to be scrutinized as to what extent the provisions of Section 21 of the Karnataka Rent Act shall have an overriding effect over any other law or a contract. The Rent Acts have primarily been made, if not wholly, to protect the interest of tenants, to restrict charging of excessive rent and their rampant eviction at will. In that view of the matter, Section 21 of the Karnataka Rent Act provides that notwithstanding anything to the contrary contained in any contract, no order for eviction of a tenant shall be made by the court or any other authority. Undoubtedly, it is a provision providing statutory protection to the tenants as it is also evident from the heading of Section 21 of the Act. This prohibition is however relaxed under the proviso saying that an order for recovery of possession of the premises can be made on an application made on that behalf only on the grounds as enumerated in clauses (a) to (p) to the proviso. The non obstante clause contained under Section 21 of the Act, will override any condition in any contract which may provide a ground for eviction other than those enumerated in clauses (a) to (p) of sub-section (1) of Section 21. Such an additional ground in a contract shall be rendered ineffective. The use of the word "only" in the proviso is significant to emphasise that it relates to grounds alone which cannot be added over and above as provided. The whole contract or other conditions not related to eviction or grounds of eviction shall not be affected. So far as a fixed-term lease is concerned, it shall be affected only to the extent that even after expiry of period of the lease the possession cannot be obtained by the lessor unless one or more of the grounds contained in Section 21 of the Act are available for eviction of the tenant. There is nothing to indicate nor has it been held in any case that in view of Section 21 of the Karnataka Rent Act a contract of fixed- term tenancy stands obliterated in totality. As indicated in the earlier part of this judgment in the case of Dhanapal Chettiar it has been observed in para 5 that none of the State Rent Acts have abrogated or affected the provisions of Section 107 of the Transfer of Property Act which provides for lease of immovable property from year to year or for a term more than a year or reserving a yearly rent. As indicated earlier, the proviso to sub-section (1) of Section 21 of the Karnataka Rent Act limits the grounds on which a landlord can seek eviction of a tenant. Nothing has been indicated by reasons of which it can be concluded that a contract of tenancy loses significance on coming into force of the Karnataka Rent Act. The effect of the non obstante clause, in our view has been rightly explained in the Full Bench decision in the cases of Sri Ramakrishna Theatres Ltd. v. General Investments and Commercial Corpn. Ltd, AIR 1993 Kant 90. In one of the decisions of this Court reported in Modern Hotel v. K. Radhakrishnaiah, (1989) 2 SCC 686, it has been held that period of a subsisting lease for fixed term could not be curtailed in the absence of a forfeiture clause in the lease.

18. The effect of the non obstante clause contained under Section 21 of the Karnataka Rent Act on the fixed- term contractual lease may be explained as follows:

(i) On expiry of period of the fixed-term lease, the tenant would be liable for eviction only on the grounds as enumerated in clauses (a) to (p) of sub- section (1) of Section 21 of the Act.

(ii) Any ground contained in the agreement of lease other than or in addition to the grounds enumerated in clauses (a) to (p) of sub-section (1) of Section 21 of the Act shall remain inoperative.

(iii) Proceedings for eviction of a tenant under a fixed- term contractual lease can be initiated during subsistence or currency of the lease only on a ground as may be enumerated in clauses (a) to (p) of sub- section (1) of Section 21 of the Act and it is also provided as one of the grounds for forfeiture of the lease rights in the lease deed, not otherwise.

(iv) The period of fixed-term lease is ensured and remains protected except in the cases indicated in the preceding paragraph.

19. With great respect therefore, in our view, the decision in the case of Dhanapal Chettiar has not been correctly construed in the case of Shri Lakshmi Venkateshwara Enterprises (P) Ltd., (1994) 2 SCC 671, and it no more holds good nor the Full Bench decision following it, in the case of Bombay Tyres International Ltd, AIR 1997 Kant 311. The earlier judgment of the Full Bench of the High Court in the case of Sri Ramakrishna Theatres Ltd. lays down the law correctly."

13.19 Reliance was placed upon the decision of the Supreme Court in Jabal C. Lashkari v. Official Liquidator, (2016) 12 SCC 44, wherein, the court held thus:

"18. Section 12 of the Rent Act confers protection on a tenant who is regularly paying or is ready and willing to pay the rent. In the present case while there is no doubt that rent has not been paid, equally, there is no doubt that the secured creditors including State Bank of India had all along been ready and willing to pay the rent and the reason for non-payment appears to be (para 43 of the impugned order of the High Court) lack of communication by the Official Liquidator to SBI of the precise amount of rent due. While there can be no doubt that mere readiness and willingness to pay without actual payment cannot enure to the benefit of the tenant in perpetuity what is required under sub-section (2) of Section 12 is a notice in writing by the landlord raising a demand of rent and only on the failure of the tenant to comply with such notice within a period of one month that the filing of a suit for recovery of possession is contemplated. The service of notice giving an opportunity to the tenant to pay the unpaid rent is the first chance/opportunity that the Rent Act contemplates as a legal necessity incumbent on the landlord to afford to the tenant. Admittedly, in the present case, no such notice as contemplated by Section 13(2) has been issued by the landlord; at least none has been brought to our notice. In such a situation, the readiness and willingness of the tenant to pay the rent, though may have continued for a fairly long time without actual payment, will not deprive the tenant of the protection under the Rent Act. Though the order of the High Court in para 43 of the impugned judgment has been placed before the Court as an order under Section 12(3)(b) of the Rent Act, we do not find the said order to be of the kind contemplated by Section 12(3)(b) inasmuch as not only the order does not mention any specific rent which has to be tendered in court but what is encompassed therein is a direction to the Official Liquidator to let State Bank of India know the precise amount that is required to be paid on account of rent and, thereafter, to pay the same to the Official Liquidator whereafter it has been left open for the lessors to withdraw the said amount from the Official Liquidator. Such an order by no stretch of reasoning would be one contemplated under Section 12(3)(b). In the aforesaid situation, the finding of the High Court that the landlord is not entitled to seek eviction on the ground of non-payment of rent under Section 12 of the Bombay Rent Act cannot be said to be so inherently infirm so as to require the interference of this Court.

19. This will bring the Court to a consideration of the liability of the Official Liquidator to a decree of eviction on the ground contemplated under Section 13(1)(e) of the Bombay Rent Act. As already discussed in a preceding paragraph of the present order, the non obstante clause of Section 13(1) overrides only the other provisions of the Bombay Rent Act and is also subject to the provisions of Section 15. Section 15 which deals with sub-letting and transfer, though overrides the provisions contained in any other law, is subject to any contract to the contrary. Though in the present case the lease deed (Clause 7) is capable of being read as permitting sub-letting and not assignment what has been held in the present case by the High Court, by virtue of the decision of this Court in Laxmidas Bapudas Darbar v. Rudravva, (2001) 7 SCC 409, is that in view of the limited operation of the non obstante clause in Section 15 of the Bombay Rent Act, unlike Section 21 of the Karnataka Act, the provisions of the Transfer of Property Act [Section 118(o)] will not become irrelevant to the relationship between the parties in which event assignment may also be permissible notwithstanding the specific content of Clause 7 of the lease deed in question. However, we need not dwell on this issue at any length or would also be required to consider the efficacy of the arguments of the learned Additional Solicitor General on the strength of the two Privy Council decisions mentioned above i.e. Hunsraj v. Bejoy Lal Seal, AIR 1930 PC 59, and Ram Kinkar Banerjee v. Satya Charan Srimani, AIR 1939 PC 14, inasmuch as from Company Application No. 34 of 2004, which deals with the claim of the appellants for eviction of the Official Liquidator from the leased property, what is clear and evident is that the case of sub-letting of the leased premises on which basis eviction has been prayed for is not sub-letting/assignment by the Official Liquidator but assignment of the leased premises to Prasad Mills by the original managing agents in whose favour the initial lease was executed by the predecessors of the present owners. The ground of unauthorised and impermissible assignment by the Official Liquidator on the strength of the notice/advertisement for disposal of the leased land thereby making the said authority liable for eviction is an argument advanced only at the hearing of the appeals before us. That apart, the said argument overlooks the fact that the assignment was only sought to be made by the advertisement/notice issued and did not amount to a completed action on the part of the Official Liquidator so as to attract the relevant provisions of the Bombay Rent Act dealing with the consequential liability for eviction. Such argument also belies the injunctive/prohibitory relief sought for in the company applications, as already noticed, insofar as the contemplated sale/transfer/assignment of the leased property by the Official Liquidator is concerned. The arguments advanced on the strength of the provisions of Section 19 of the Bombay Rent Act would also stand answered on the above basis."

13.20 It was submitted that, applying the principles enunciated in the above decision to the facts of the present case, the applicant had issued notice on 02.09.2016 for payment of Rs.10,500/-, whereafter, Rs.10,000/- was paid on 10.01.2017 and the remaining Rs.500/- was paid subsequent thereto on 04.04.2017, therefore, there is substantial compliance of the requirements of section 12(2) of the Rent Act. It was submitted that there was no lack of readiness and willingness on the part of the Official Liquidator to pay the arrears of rent. It was submitted that in respect of the amount relating to the period 2017 to 2020, such amount has been paid on 16.03.2020 and that, in any case for non-payment of arrears there is a requirement on the part of the lessor to issue notice from time to time.

13.21 Reliance was placed upon the decision of the Bombay High Court in Ratanlal Chandiprasad Jalan v. Raniram Darkhan, AIR 1986 Bom 184, wherein the court has held that a statutory tenant would continue to possess the same rights and would be under the same obligations which were available during the subsistence of the contractual tenancy. The question whether a statutory tenant has a transferable interest or not would depend upon the terms of the contractual tenancy. Such terms would continue to operate even after the contractual tenancy comes to an end and the tenant becomes a statutory tenant. But again this would be subject to a contrary provision in the Bombay Rent Act. Under section 108(j) of the Transfer of Property Act in the absence of a contract to the contrary the lessee has a right to transfer his tenancy rights absolutely or by way of sub-lease etc. This right would continue to exist in favour of a statutory tenant but all this would be subject to the provisions of the Bombay Rent Act. Section 15 of the Bombay Rent Act provides that notwithstanding anything contained in any law but subject to a contract to the contrary it shall not be lawful for the tenant to sublet his interest. Thus, it would be necessary to read this provision and section 108(j) of the Transfer of Property Act together. So read, it would be clear that a tenant, under the Transfer of Property Act, can sublet his interest if there is contract to the contrary. However, section 15 (now section 15(1)) of the Rent Act prohibits any sub-lease, assignment or transfer by a tenant of his interest if there is no contract to the contrary; a breach thereof renders the tenant liable to eviction under section 13(1)(c). Thus, under the Rent Act, sub-tenancy will be permissible not when the contract is silent but when the contract specifically permits a sub-lease.

13.22 Reference was made to section 114 of the Transfer of Property Act, which provides for relief against forfeiture for non-payment of rent and lays down that, where a lease of immovable property has determined by forfeiture for non- payment of rent, and the lessor sues to eject the lessee, if, at the hearing of the suit, the lessee pays or tenders to the lessor the rent in arrears, together with interest thereon and his full costs of the suit, or gives such security as the court thinks sufficient for making such payment within fifteen days, the court may, in lieu of making a decree for ejectment, pass an order relieving the lessee against forfeiture; and thereupon the lessee shall hold the property leased as if the forfeiture had not occurred. It was submitted that in view of the fact that during the pendency of suit, the rent arrears have been paid, the provisions of section 114 of the Transfer of Property Act would come into operation and the Official Liquidator is entitled to continue hold the leased property.

13.23 The learned counsel, next placed reliance upon the decision of a Division Bench of this court in Virendra Bhogilal Shah (HUF) v. Official Liquidator of Sarangpur Cotton Man. Co. Ltd. (Unit of GSTC), rendered on 06.04.2018 in O. J. Appeal No. 13 of 2007, wherein, the court held that considering the terms of the lease deed it appears that the landlord/lessor has carved out absolute transferable interest in favour of the lessee in the perpetual lease. There is no forfeiture clause. There is no right to re-entry. The court held that the decision of the Supreme Court in Jabal C. Lashkari (supra) shall be applicable with full force to the facts of that case.

13.24 The attention of the court was invited to the provisions of sections 105, 106 and 107 of the Transfer of Property Act. Reference was made to section 108 of the Transfer of Property Act and more particularly, to part (B) thereof, which provides for "Rights and Liabilities of the Lessee". Reference was made to clause (j) thereunder, which provides that the lessee may transfer absolutely or by way of mortgage or sub-lease the whole or any part of his interest in the property, and any transferee of such interest or part may again transfer it. The lessee shall not, by reason only of such transfer, cease to be subject to any of the liabilities attaching to the lease. It was submitted that, therefore, in case of an ordinary lease, the lessor remains the owner for all purposes, for breach he can exercise ownership rights to take possession; whereas, in case of a permanent lease, he is only entitled to receive the rent. It was submitted that all the terms and conditions have to be read together to ascertain whether the lease of 1911 is a permanent lease or an ordinary lease.

13.25 The attention of the court was invited to section 111 of the Transfer of Property Act which provides for determination of lease, to submit that the lease of immoveable property can be determined only in the eventualities as envisaged thereunder. It was submitted that none of the contingencies envisaged under section 111 of the Transfer of Property Act are applicable in the facts of the present case and hence, the applicant is not entitled to determine the lease. Referring to clause (g) of section 111 of the Transfer of Property Act, it was pointed out that the same provides that a lease of immoveable property can be determined by forfeiture in case the lessee breaks an express condition which provides that, on breach thereof, the lessor may re-enter. However, the clause requires the lessor or his transferee to give notice in writing to the lessee of his intention to determine the lease. It was submitted that in the facts of the present case, apart from the fact that the lease deed of 1911 does not provide for determination of the lease by the lessor, even otherwise, in the facts of the present case, no notice has been issued for determination of the lease.

13.26 It was submitted that section 15 of the Rent Act permits sub-letting if there is a contract to the contrary. Therefore, the contract between parties has a pivotal role to play. It was submitted that when the lease is a permanent lease and no forfeiture clause is expressly set out, sections 15 and 13 of the Rent Act will not apply. It was submitted that the applicant claims leasehold rights through Calico Limited. Section 53A of the Transfer of Property Act enables Jubilee Mills to use the documents which are not registered as a shield to protect possession and hence, the applicant cannot claim title on the basis that the agreement of 1983 is unregistered. Furthermore, non-registration of the agreement will not give rise to any right in favour of the original transferor to take possession from Jubilee Mills.

13.27 Reference was made to the decision of the Supreme Court in Jabal C. Lashkari v. Official Liquidator (supra) and the decision of Oudh High Court in Bhagwati Prasad v. Balgobind (supra) and the decision of the Mysore High Court in Ramacharya Narayana Charya Burli v. State (supra). It was submitted that in this case, the lease is heritable and transferable and not for a fixed period and therefore, it is in the nature of a permanent lease. Accordingly, the agreement between Jubilee Mills and Calico Limited is secondary and it is the lease deed of 1911 which governs all the lessees who come into the picture. Therefore, it is this lease deed which has to be taken into account. If under that lease deed of 1911, the property is heritable, the lessor cannot claim that he has a right to take the property back.

13.28 It was submitted that under section 53A of the Transfer of Property Act, part performance has been taken care of and that, one cannot forget the link between lease deeds of 1911 to 1983 and that, for all purposes, the lessor has remained constant and that, he cannot enforce any rights against Jubilee Mills to contend that the deed is not registered. It was further submitted that the present applications are barred under Articles 66 and 67 of the Limitation Act, 1963, insofar as the ground of non-use of property is concerned.

14. Mr. D.S. Vasavada, learned counsel for the respondent - Textile Labour Association, at the outset, has adopted the submissions advanced by Mr. Kamal Trivedi, learned counsel for the Official Liquidator.

14.1 The learned counsel further submitted that the Supreme Court in Jabal C. Lashkari (supra) has except in the case of Jabal Lashkari, remanded the rest of the OJ Appeals, with a clear direction that the High Court should examine the clauses of the lease deed in each of the matters. It was submitted that O.J. Appeal No.1 of 2003 was preferred against the order passed in Company Application No.16 of 1999, wherein a judgment was delivered by the Division Bench, which was challenged before the Supreme Court in the special leave petition. It was submitted that it was the lease deed dated 4th August, 1911, which was on the record of the Supreme Court. The Supreme Court has remanded the case with a direction to examine the clauses of the lease deed in line with the observations and principles of law laid down in O.J. Appeals No.64, 65 and 66 of 2006. It was submitted that in view of this direction, the High Court has to confine itself within the scope and ambit of the judgment delivered in Jabal C. Lashkari (supra) and that any adjudication beyond that will not be permissible. It was submitted that the Supreme Court delivered the judgment in March, 2016 and O.J. Civil Application No.358 of 2016 has been filed to consider the Deed of Assignment which was made by Calico Mills with Jubilee Mills in 1983. The Deed of Assignment was not on the record of the O.J. Appeal No.1 of 2013 and, therefore, adjudication of the O.J. Civil Application No.358 of 2016 will be beyond the scope and purview of the judgment of the Supreme Court.

14.2 Without prejudice to the aforesaid contention, the learned counsel has submitted that a notice, that is, prior notice before filing the company application has to be given to the lessee which is a mandatory requirement and it has been held in Jabal C. Lashkari (supra) that issuance of prior notice to the lessee by the lessor for claiming the possession and arrears of rent is a legal necessity, whereas, in the present case, in both the matters, that is, Company Application No.16 of 1999 and OJ. Civil Application No.358 of 2016, prior notice has not been given before filing the proceeding in the High Court. Therefore, the mandatory requirement is not met with and both the applications deserve to be dismissed on this ground alone.

14.3 It was further submitted that the issue of transfer of all assets from Calico Limited to Jubilee Mills has been adjudicated and this court in Company Application No.302 of 1999 has clearly held that the transfer is complete and it is legal and documents could not be executed or registered because of legal embargo under the Urban Land Ceiling Act. It was pointed out that this order of the learned Single Judge was carried in O.J. Appeal and the O.J. Appeal was withdrawn in 2015. Thus, the order has become final and, therefore, the applicant cannot be heard to contend that the Deed of Assignment of 1983 is illegal and cannot be looked into for want of registration under the Registration Act.

14.4 Next, it was submitted that lease is of permanent nature and is perpetual and does not provide for a forfeiture clause. It was contended that even under the provisions of Transfer of Property Act and relevant clauses in the lease deed, there is a provision of issuance of prior notice for recovery of rent and claiming back the possession. However, this mandatory requirement is also not complied with and, therefore, on this ground also both the matters are required to be dismissed.

14.5 It was submitted that in Jabal C. Lashkari (supra) the Supreme Court has clearly held that the provisions of the Transfer of Property Act will prevail and the Rent Act will not apply. Therefore, the arguments advanced by the applicant regarding violation of the provisions of the Rent Act pale into insignificance.

14.6 Lastly, it was submitted that in any matter under the Companies Act, sections 529 and 529(A) thereof cannot be ignored by the court hearing company matters. In the present case, Jubilee Mills (in liquidation) was employing 3287 workmen and their total dues as ascertained by the Chartered Accountant are more than Rs.25 crores. The workmen have received only Rs.6 crores. The winding up order was passed in 1989. Even after thirty one years, the workmen have not received their dues and during this intervening period, more than 1100 workmen have passed away. It was submitted that the Official Liquidator should be empowered to transfer the leasehold rights for consideration and he should be allowed to comply with the provisions of sections 529 and 529(A) of the Companies Act for payment of the workers dues and dues of the secured creditors. The learned counsel placed on record a statement of the outstanding dues of the workmen in respect of various mill companies.

14.7 Reliance was placed upon the decision of this court in State Bank of India v. Official Liquidator of Commercial Ahmedabad Mills Co. & Ors., 2009 (1) GLR 420, wherein the court held thus:-

"15. In fact, when Section 529-A of the Act was proposed to be introduced vide Companies (Amendment) Bill, 1985, the statement of object and reasons provided as under:-

"Another announcement made by the Finance Minister in his Budget speech relates to the decision of the Government to introduce necessary legislation so that legitimate dues of workers rank pari passu with secured creditors in the event of closure of the company and above even the dues to Government.

The resources of the companies constitute a major segment of the material resources of the community and common good demands that the ownership and control of the resources of every company are so distributed that in the unfortunate even of its liquidation, workers, whose labour and effort constitute an invisible but easily perceivable part of the capital of the company are not deprived of their legitimate right to participate in the product of their labour and effort. It is accordingly proposed to amend Sections 529 and 530 of the Companies Act and also to incorporate a new Section in the Act, namely Section 529A vide clauses 4, 5 and 6 of the Bill)."

16. In case of T.L.A. Vs. Official Liquidator reported in 2004(3) GLH 416, the Apex Court was called upon to decide the true scope of provisions of Section 529-A of the Act in light of the priority claimed by Oil and Natural Gas Commission on the basis of an order made by the Apex Court in favour of ONGC. The Supreme Court has laid down as under:-

"8. The effect of Sections 529 and 529-A is that the workmen of the Company become secured creditors by operation of law to the extent of the workmen's dues provided there exists secured creditor by contract. If there is no secured creditor then the workmen of the company become unsecured preferential creditors under Section 529-A to the extent of the workmen's dues. The purpose of Section 529-A is to ensure that the workmen should not be deprived of their legitimate claims in the event of the liquidation of the Company and the assets of the Company would remain charged for the payment of the workers' dues and such charge will be pari passu with the charge of the secured creditors. There is no other statutory provision overriding the claim of the secured creditors except Section 529-A. This Section overrides preferential claims under Section 530 also. Under Section 529-A the dues of the workers and debts due to the secured creditors are to be treated pari passu and have to be treated as prior to all other dues.

9. Therefore, the law is clear on the matter as held in UCO Bank's case that Section 529-A will override all other claims of other creditors even where a decree has been passed by a Court.

10. Therefore, claims, if any, of O.N.G.C. will have to be worked out in accordance with Sections 529 and 529-A of the Companies Act as well. The contention advanced on behalf of O.N.G.C. by Shri Raju Ramchandran that if a mandamus had been issued, it will prevail over any law is not tenable and is rejected."

14.8 It was submitted that for all purposes the workmen have a first charge over the property of the company in liquidation and, therefore, they have a first charge over the leasehold interest in the subject property. It was submitted that workmen dues get priority over all other dues and this aspect may not be lost sight of.

15. In rejoinder, Ms. Megha Jani, learned counsel for the applicant submitted that insofar as the contention of the learned counsel for the respondents that the lease of 1911 is a permanent lease is concerned, such lease is a periodic lease of one year at a time. Attention was invited to clause (1) of the lease deed of 1911, to submit that on a consideration of the recitals contained therein, it is evident that it is a periodic lease of one year at a time, whereby the rent has to be paid before the commencement of the year, and if not paid, the lessors have a clear right to enter and forfeit the land. It was submitted that this clause is not a residuary clause but is the first clause and the terms and conditions of the lease deed start with this clause. It was submitted that thus there is a very clear forfeiture clause and right of entry in the lease deed.

15.1 The attention of the court was invited to clause (10) of the lease deed of 1911 which provides that "the rent of the said farmlands shall be payable with effect from 15.6.1911 and if we want to surrender the farmlands then from the date of taking the same on rent till a period of ten years, we cannot leave them, despite which if we surrender them, then you, your guardians, heirs shall be entitled to recover ten years rent at a time from us, our guardians, heirs and in respect of the same we, our guardians, heirs shall not raise any kind of dispute or objection and if, after a period of ten years is over, we want to surrender the said farmlands then in the year in which we surrender the same, we will not raise any claim for the rent paid prior thereto and if we want to surrender the land, we shall remove the construction on the land from the foundation and level the land and handover the possession to you, and if you have to do it, you shall be entitled to recover the entire costs from us".

15.2 It was submitted that thus clause (10) of the lease deed provides for a minimum duration of ten years and above and that while it is not a fixed term lease, it is a periodic lease. In support of such submission, the learned counsel placed reliance upon the decision of a Full Bench of this court in Nanalal Girdharlal and another v. Gulamnabi Jamalbhai Motorwala and others, (1972) 13 GLR 880, wherein the court held thus:-

"5. We may now proceed to consider the true nature and character of a periodic lease. It is evident that the duration of the term in a periodic lease is continuous from period to period. The interest of the lessee does not terminate at the end of the period but continues indefinitely from period to period until determined by a notice to quit given by the lessor or the lessee. The characteristics of a periodic tenancy from year to year have been stated with great clarity and precision by the Court of Exchequer Chamber in the early case of Grandy v. Jubber, (1868) 9 B. & S. 15:

"There frequently is an actual demise from year to year so long as both parties please. The nature of this tenancy is discussed in 4 Bac. Abr. Lit. Lease and Terms for years pp. 838. 839. 7th ed., and the article has always been deemed of the highest authority. It seems clear that the learned author considered that the true nature of such a tenancy is that it is a lease for two years certain, and that every year after it is a springing interest arising upon the first contract and parcel of it so that if the lessee occupies for a number of years, these years by computation from the time past, make an entire lease for so many years, and that after the commencement of each new year it becomes an entire lease certain for the years past and also for the year so entered on and that it is not a reletting at the commencement of the third and subsequent years. We think this is the true nature of a tenancy from year to year created by express words, and that there is not in contemplation of law a recommencing or reletting at the beginning of each year."

5. When one period comes to an end and the tenancy goes into the next period, it does so by virtue of the original contract of lease and as a direct consequence of it and not because of any fresh contract of reletting. There is no common assent between the lessor and the lessee arrived at afresh for continuing the tenancy into the next period. The tenancy goes on from period to period by force of the original contract of lease until the contract is determined by notice to quit on the part of either lessor or lessee. Now where there are two or more co-owners who have granted a periodic tenancy, the contract of tenancy can be put an end to only by the joint action of all co- owners and the notice to quit must, therefore, be given by or on behalf of all co-owners. What has commenced under the common volition of all co-owners can be brought to an end only by a fresh common volition on their part. Vide the observations of Sir Lallubhai Shah J. in Maganlal v. Bhudar 29 Bom. LR 222 at p. 226 = (AIR 1927 Bom 192). No one co-owner who is a tenant-in-common can also terminate the tenancy as to his undivided share alone for the contract of tenancy is one and indivisible and it cannot be split up except by consent of all who are parties to it. Vide Baraboni Coal Concern Ltd. v. Gokul Anand. 61 Ind.

App. 35 at P. 39 = (AIR 1934 PC 58). It is, therefore, obvious on first principle that all co-owners must join in giving notice to quit determining a periodic tenancy. This would appear to be so also on a plain reading of Section 108 in cases falling within that Section, Section 106 says that in the circumstances there mentioned a lease shall be deemed to be a lease from year to year or from month to month terminable on the part of either lessor or lessee by notice to quit. Now singular includes the Plural and therefore where there are two or more lessors, the notice to quit must be given by all lessors. We cannot construe the words "on the part of....--lessor" as if they were "on the part of...lessor or any one of the lessors where there are more than one lessor." Vide the reasoning of Warrington. J., in Re Viola's Indenture of Lease (1909) 1 Ch. 244 as explained by Somervell LJ in (1952) 2 QB 988 (supra)."

It was submitted that, therefore, the lease in question is a periodic lease and not a permanent lease.

15.3 Reliance was also placed upon the decision of the Supreme Court in Hamidullah (Dead) by his Legal Representatives and others v. Sheikh Abdullah and others, (1972) 4 SCC 800, wherein the court held that the mere fact that a uniform fixed rent had been paid for a long time or the fact that the lessees were in possession of the land for a long time and were making constructions on the land at their own cost would not, in the circumstances of the case raise a presumption that the tenancies were of permanent character. The court held that in every case an inference of permanency of tenancy is a question of fact depending upon the facts of each particular case. The court referred to its earlier decision in Bejoy Gopal Mukherji v. Praful Chandra Ghose, AIR 1953 SC 153, wherein it was held that neither possession for generations at uniform rent nor construction of permanent structures by itself is conclusive proof of permanent tenancy. It is the cumulative effect of these circumstances coupled with several other facts that may lead to an inference of permanent tenancy.

15.4 It was submitted that on a perusal of the clauses of the lease deed of 1911, it is evident that the intention of the parties is to create a lease from year to year and not for all times to come. It was submitted that all the judgments cited by the learned counsel for the respondents deal with fixed term lease deed and, therefore, those judgments would not be applicable to the facts of the present case.

15.5 It was submitted that the decision of the Division Bench of this court in Virendra Bhogilal Shah (HUF) v. O.L. of Sarangpur Cotton Man. Co. Ltd. (Unit of G.S.T.C.) (supra) will not apply to the facts of the present case because in the facts of that case (i) the lease was a permanent lease;

(ii) there was a concession of the learned advocate for the appellant to the effect that they were not claiming possession of the land; (iii) they had limited their claim to possession; and

(iv) concession was also to the effect that Rent Act is not applicable. It was submitted that in that case there were in all four transfers but the middle two transfers were validated by an Act enacted by the State Legislature and by order of this court. The attention of the court was invited to paragraph 4.4 and 4.18 of the decision, to submit that the matter was not argued on the basis of the provisions of the Rent Act. Attention was invited to paragraph 8.6 of the judgment, wherein the conditions of the lease deed have been set out, to submit that there was no clause for re-entry or forfeiture in the said lease deed. Moreover, the lease deed does not spell out the purpose for which it was given. It was submitted that the first condition reproduced in the judgment clearly says that the property has been leased permanently, condition No.13 also says that the second party has taken the land on lease permanently from the first party, and the last clause says that the first party do alienate the land in the name of the second party. It was submitted that the conditions of the lease deed in the said case being totally different from the conditions of the lease deed in the present case, the said decision will not apply to the facts of this case.

15.6 Reference was made to section 535 of the Companies Act which provides for disclaimer of owners property in case of a company which is being wound up. It was submitted that once the company dissolves, the Official Liquidator can do nothing with the land, inasmuch as, in the present case the leasehold rights are not an asset of the company, and hence, it is not permissible for the Official Liquidator to sub-let or sub- lease the same.

15.7 Reference was made to the decision of this court in Uttra Achyut Chinubhai v. O.L. Of Nanikram Shobhraj Mills (supra), and more particularly to the directions contained in clause (c) of paragraph 31 thereof which reads as under:-

"(c) Upon any objection received, the OL shall move, within 15 days from the date of receipt of such objection, report to this Court on the said aspects for appropriate orders. In absence of objection of any other person or the Court passing orders upon such report and after removal of super-structure by the offerer/purchaser, whose offer may be accepted by this Court, whichever is later, the OL would not be required to retain the property any further. Hence, within two weeks after the said later date, after drawing proper inventory and panchnama, the possession of the property shall be handed over by the OL to the applicant."

15.8 Reliance was also placed upon the decision of this court in Anil Private Limited v. O.L. of GSTC (supra), wherein the court has observed thus: "

14. From the undisputed facts which have come on record, it is apparent that there is no deed of lease and the company in liquidation had occupied the premises in question on a monthly tenancy. The nature of the tenancy therefore itself shows that the tenancy was terminated every month subject to payment of rent. There is no dispute that the premises in question situated at Mumbai are not of any use so far as the Official Liquidator is concerned. The premises are not required by the company for the purpose of business of the company or for the purpose of winding up the Company in liquidation.

15. In a situation which was more or less identical the Apex Court was called upon to decide the question raised before me. In the case before the Supreme Court the date of commencement of lease was not available nor was it claimed on behalf of the liquidator that the lease was of long duration. It was also an agreed position tht for the purpose of winding up or for business of the Company the liquidator did not need the premises. In such circumstances when the High Court had permitted the liquidator to enter into a care taker agreement by virtue of which a third party as put in possession of the premises, the Supreme Court held that:

"11. The learned Company Judge could not have permitted holding on to possession of the premises, not needed for efficiently carrying on winding up proceedings. The only course open to him was to direct the Liquidator to surrender possession to landlords and save recurring liability to pay rent."

16. Applying the aforesaid ratio to the facts of the case, the liquidator is hereby directed to handover the vacant and peaceful possession of the premises....."

15.9 Reliance was placed upon the decision of this court in Dhairyasinh P Rajda v. Ahmedabad Manufacturing & Calico Printing Mills Company Ltd, (supra) whereby the learned Company Judge directed the Official Liquidator to handover peaceful and vacant possession of the property in question after removing the seal to the applicant and co- owners, if any.

15.10 Ms. Jani submitted that under section 535 of the Companies Act, the Official Liquidator has the power to disclaim any property which is onerous. It was submitted that the Official Liquidator does not have any right to sub-lease or sub-let the property in question nor does he require the subject property for the purposes of winding up, and hence, the Official Liquidator be directed to handover the possession of the subject property to the applicant.

15.11 It was submitted that section 23 of the Registration Act provides for the time for presenting documents and lays down that no document other than a will shall be accepted for registration unless presented for that purpose to the proper officer within four months from the date of its execution. It was submitted that the contention advanced on behalf of the Official Liquidator that the agreement of 1983 can still be registered, being contrary to the provisions of section 23 of the Registration Act, does not merit acceptance.

15.12 It was submitted that rights of a statutory tenant are not assets of the company and hence, the bar of section 19 of the Rent Act would apply. It was further submitted that statutory tenant cannot sub-lease the land. In support of such submission the learned counsel placed reliance upon the decision of the Bombay High Court in N.M. Nayak v. Chhotalal Hariram (supra).

15.13 It was submitted that section 15 and section 5(1) of the Rent Act refer to the original lessee and not a sub- lessee. It was submitted that the transfer from Calico Limited to Jubilee Mills is unlawful as the agreement is not registered. It was submitted that the provisions of section 15 of the Act which provide that subject to a contract to contrary, are available only to the lessee and not to a sub-lessee.

15.14 It was submitted that transfer from Calico Limited to Jubilee Mills being unlawful, the applicants have a right to seek eviction under section 13(e) of the Rent Act. It was submitted that the Official Liquidator cannot further assign the subject property as there is no valid contract and that even if there is a valid contract, he cannot further assign the subject property as he is a sub-lessee. Moreover, section 19 of the Rent Act prohibits such a transfer. It was urged that only land is lying and all the buildings, plants and machinery have been removed, therefore, dissolution of the company is a certainty; the subject property is an asset which the official liquidator does not require; there are mounting dues and rent has not been paid; and hence, the subject property is required to be returned to the applicants.

15.15 Reliance was placed upon the decision of the Supreme Court in Board of Trustees of the Port of Mumbai v. M/s. Byramjee Jeejeebhoy Pvt. Ltd. , 2011 (5) SCR 157. Reliance was also placed upon the decision of the Supreme Court in K.K. Krishnan v. M.K. Vijaya Raghavan, (1980) 4 SCC 88, wherein the court in the context of sub- section (4) of section 11 of Kerala Buildings (Lease and Rent Control) Act, 1965 held that read plainly and without gloss, the section simply and clearly, means that a tenant may be evicted on the ground of sub-letting unless such subletting is permitted by a term of the lease itself or by subsequent consent of the landlord. What is necessary is an application of the mind and the resulting consensus between the landlord and the tenant.

16. At the time when the matters were initially heard and kept for dictation, Mr. Uday Bhatt, learned advocate had appeared on behalf of the State Bank of India and had adopted the submissions made by the learned counsel for the Official Liquidator and Textile Labour Association.

17. In the backdrop of the facts and contentions noted hereinabove, the first question that arises for consideration is, whether the lease deed dated 4.8.1911 is a permanent/perpetual lease. Considering the view that the court in inclined to take in the matter, the question as to whether or not the lease is a permanent lease would pale into insignificance, but having regard to the fact that the learned counsel for the respective parties have addressed the issue at length, and the Supreme Court has remanded the case to the High Court to consider the question as to what would be the effect of the principles underlying its decision in Jabal C. Lashkari (supra) vis--vis the specific clauses of the lease deed between the parties in each of the cases, the court deems it fit to answer this question.

18. Before adverting to the merits of the case, it may be apposite to refer to the principles enunciated by the Supreme Court as well as other courts in the decisions relied upon by the learned counsel for the respective parties.

19. In A. Caspersz v. Kader Nath Sarbadhikari, (supra), the Calcutta High Court, was of the opinion that the facts of the said case viz. long possession by the defendants and their ancestors, the fact of the landlord having permitted them to build a pucca house upon it, that the house has been there for a very considerable time; it had been built by successive tenants, and that the tenure had from time to time been transferred by succession and purchase, in which the landlord is found to have acquiesced, or of which he could not have been ignorant as he accepted rent from the transferees; were sufficient to warrant the court in presuming that the tenure was of a permanent nature.

20. In Mt. Afzal un Nissa v. Abdul Karim and others, (supra), the Privy Council referred to the above referred judgment of the Calcutta High Court.

21. In Sivayogeswara Cotton Press, Devangere v. M. Panchaksharappa, (supra) on the question of interpretation of the document, the Supreme Court noticed that it was a lease of the demised premises for a term of twenty years certain, on payment of Rs.350 annual rent in advance, even though the lessee may not continue to occupy the demised land; that the lessee had been granted a right to continue the lease of the demised premises as long as the lessee desired to do so; that on his choosing to continue to enjoy the leasehold, the lessee was obliged to pay annually the enhanced rent of Rs.400 for the next ten years after October 1, 1934, and after the expiration of the ten years aforesaid, the rent was further enhanced to the sum of Rs.500 per annum; that the lessee was given the option to give up the lease at any time after October 1, 1934, without any further liability for payment of the stipulated rent; that the lessor bound himself not to call upon the lessee at any time to give up possession of the lease-hold as long as the lessee was prepared to observe the terms of the lease; that the lessee was fully authorised "to erect, as many buildings, godowns, factories, bungalows and other structures etc." as also to pull down and re-erect structures or to make any alterations, as desired by him; that the lessor undertook not to raise any objection to the lessee making those structures or his using or enjoying the land in any way or for any purposes according to his desire; that the lessor undertook to pay the annual assessment to the Government in respect of the demised premises but the lessee was obliged to pay all fines and other taxes which the Government might impose for granting permission to convert the culturable land into land meant for building factories and other structures as contemplated between the parties that if the lessee chose to give up possession of the demised premises, he shall be entitled to take away all machinery, iron and steel, woodworks etc. of the factories, buildings and other structures that may be standing; that in the event of a default in the payment of the annual rent fixed as aforesaid, upon notice of demand served upon the lessee, the lessor reserved the right to retake possession of the demised land. The lessee was also declared to be always entitled to sub-let or re-let the demised/land to any person and on any terms. The terms and conditions of the lease which created the rights and obligations between the lessor and the lessee were specifically declared to be binding on the heirs and successors-in-interest of the lessor and the lessee.

21.1 The court further noted that on a plain construction of the terms aforesaid of the lease deed, it should be manifest that the purpose of the transaction was a building lease that though there was liberty reserved for the lessee or his successor to give up the lease-hold at any time after October 1, 1934, no corresponding right was reserved to the lessor. The court found that the lease was heritable and assignable and thus there was no room for the contention, on the terms of the lease, that the parties intended that after the lapse of the first twenty years of the lease, the tenancy will be merely a tenancy at will. The court held that it was clearly a tenancy for an indefinite period, at the least. The court held that where the land is let out for building purposes without a fixed period, the presumption is that it was intended to create a permanent tenancy.

21.2 The court was of the opinion that the presumption raised by the fact that the lease was for building purposes and, therefore, intended to be permanent is not weakened by the fact that the lessee had stipulated with the lessor to be entitled to give up possession if and when he decided to do so. It is a right reserved in favour of the lessee and did not confer, any corresponding right on the lessor. The court held that such a right in favour of the lessee cannot be converted into a disability or an obligation which should detract from the grant of a permanent tenancy. Such a stipulation which gives a right to the tenant to surrender the lease-hold at any time he decided to do so, if it is coupled with a corresponding right in the landlord to serve notice of ejectment at any time he chose to do so may have the effect of making the tenancy, a tenancy at will.

21.3 The court agreed with the decision of the Bombay High Court in Bavasaheb Walad Mansursaheb Korti v. West Patent Press Co. Ltd., AIR 1954 Bom 257, wherein the court held that the nature of the tenancy created by any document must nevertheless be determined by construing the document as a whole. If the tenancy is for a building purpose, prima facie it may be arguable that it is intended for the life-time of the lessee or may in certain cases be even a permanent lease. Prima facie such a lease is not intended to be, tenancy at will. But whether it is a tenancy for life or a permanent tenancy must ultimately depend upon the terms of the contract itself. And in construing the terms of such contracts the courts must look at the substance of the matter and decide what the parties really intended to do. In the facts of the case before it, the Supreme Court noted that the lease was intended by the parties to be heritable and assignable. It was a lease for twenty years certain, and then in terms which were not wholly unequivocal in respect of the period after the lapse of the initial twenty years. That the lease was not intended to be for the life only of the grantee was clear not only from the facts already noticed, namely, that it was meant for building purposes, was heritable and assignable and had not reserved any right to the lessor to terminate the tenancy.

22. In A.H. Forbes v. Hanuman Bhagat (supra), the Patna High Court, upon considering the terms of the lease found that the lease was for the purpose of gola business and for building houses. It was also clear that the erection of pucca buildings for the business as well as for the purpose of residence was in the contemplation of the parties with the condition that permission for erecting pucca structures will have to be taken from the lessor. The court held that under these circumstances, inference is not unreasonable that the lease in question was meant to be of a permanent character and not from year to year.

23. In Chapsibhai Dhanjibhai Danad v. Purushotttam (supra), the Supreme Court, after considering the principles enunciated in its earlier decision in Sivayogeswara Cotton Press v. M. Panchaksharappa (supra), in the facts of the case before it held that looking to the document as a whole, the lease undoubtedly was for building a residential structure. Though it was for thirty years certain, the lessee was entitled to remain in possession of the land so long as he paid the stipulated rent which the lessor was not entitled to increase. But, though the lease was for building structure and the period was indefinite, there were at any rate no express words indicating that the leasehold rights thereunder were intended to be heritable. On the other hand, it expressly provided for the right of the lessee to remove the structures, meaning thereby vacating the land, if he so desired. The clause providing for such removal was not that the lessee would remove the structures on default in payment of rent, but depended on his own volition, which according to the Supreme Court was a clause indicative of the parties not having intended the lease to be permanent. The court held that if it was intended to be permanent, there was no necessity for providing such a right. It was argued before the court that there were words in the document indicative of the lease having been intended to be heritable as in the case in Sivayogeswara Cotton Press (supra). The court held that the mere fact that a lease provides for the interests thereunder to pass on to the heirs of the lessee would not always mean that it is a permanent lease. Such a provision can be made in two ways resulting in two different consequences. A lease may provide a fixed period and then include a provision that in the event of the lessee dying before the expiry of such period, his heirs would be entitled to have the benefit of the lease for the remainder of the period. In such a case, although the lease may provide for the heirs to succeed to the interests in the leased land, it would only mean that such heirs succeed to the rights up to the expiry of the lease period. If the lease, on the other hand, were for an indefinite period, and contained a provision for the rights thereunder being heritable, then, such a lease, though ordinarily for the lifetime of the lessee, would be construed as permanent.

23.1 Reference may be made to the contents of the deed in the above case, as referred to in paragraph 11 thereof, which read thus:-

"11. After reciting the purpose for which it was made, the term of 30 years and the rent, the deed provides:

"Even after the prescribed time-limit, I shall have a right to keep my structure on the leased out land, so long as I like, and I shall be paying to you the rent every year as stated above."

Though the period is 30 years, this part of the document would make the lease for an indefinite period which would ordinarily mean a lease for the lifetime of the lessee. What follows then, however, gives scope for the argument that it is not merely for the lifetime of the lessee:

"You will have no right to increase the rent and I shall also not pay it, myself and my heirs shall also not pay it, myself and my heirs shall use this land in whatever manner we please. After the lease period, we shall, if we like, remove our building right from the foundation and vacate your land. In case we remove our structure before the stipulated period, we shall be liable to pay to you, the rent for all the thirty years, as agreed to above."

And further.

"In case I were to sell away the buildings, which I shall be constructing on the above land, to anyone else, then, the purchaser shall be bound by all the terms in this lease deed."

23.2 The court held that this part of the document undoubtedly gives the lessee the right to transfer by sale the leasehold interest; but observed that a clause enabling the leasehold interest to be transferred does not render such interest heritable. The court further held thus:-

"12. The effect of these clauses is that the first part of the document ensures that the lessor cannot charge rent higher than the agreed rent even if the lessee were to remain in possession after the period of 30 years. That part is consistent with the lease being for an indefinite period, which means for the lifetime of the lessee. The next part provides for the right to remove the structures "after the lease period". The words "after the lease period" mean either at the end of the 30 years, or on the death of the lessee, because, it also says that if the lessee were to remove the buildings before the expiry of 30 years, he would have to pay the rent for the remainder of that period. This part of the document does not show the intention that the lease was to be a permanent lease. It merely ensures the right to remove the structures if the lessee or his heirs so desired on the expiry of the lease period i.e. either at the end of 30 years, or after the lifetime of the lessee. The heirs are mentioned here to provide for the contingency of the lessee dying before the expiry of 30 years and also for the contingency of his living beyond that period and continuing to occupy the land. In the event of the first contingency, the lessee's heirs would continue in possession till the expiry of 30 years and then remove the structures if they wished. In the case of the second contingency, the heirs of the lessee would have the right to remove the structures on the death of the lessee. In either event the right provided for is the right to remove the structures. It is not a provision for the lease being heritable and its being consequently a permanent lease. Thus, the lease is for a period certain i.e. 30 years and on the expiry of that period if the lessee still were to continue to pay the rent, for his lifetime. In the event of his dying before that period, the benefit of the lease would enure to his heirs till the completion of 30 years. They would be entitled to remove the structures either at the end of the 30 years if the lessee were to die before the expiry of that period or at the end of the lessee's life were he to continue to be in possession of the leased property after the expiry of 30 years. But the lease did not create hereditary rights so that on the death of the lessee his heirs could succeed to them.

13. In this connection, it is necessary to note that, as translated in English, It would appear as if the document uses the pronoun 'I' meaning as if the lessee, in the earlier part and the pronoun 'we' meaning the lessee and his heirs, in the latter part. Such a translation, however, is not correct. We ascertained from Mr. Ratnaparkhi who after looking at the original Marathi assured us that the pronoun used throughout is Ami, which means "we", a term often used in document written in regional language for the executant instead of the singular 'I'.

14. In our view the lease before us is clearly distinguishable from that in the case of Sivayogeswara Cotton Press (supra) where the leasehold rights were in clear terms made heritable and where the court held that clause (14), though placed last in the document, governed all its terms. There is no provision in the present case comparable with such a clause. The lease was undoubtedly for an indefinite period which only means that it was to enure for the lessee's lifetime. Reference in it of the heirs of the lessee is only for the limited purposes set out earlier and not for making the leasehold interests heritable. We do not find in the document words such as those in Sivayogeswara Cotton Press (supra) which would compel us to the conclusion that the lease was intended to be permanent."

24. In the facts of the present case, on behalf of the respondents, it has been contended that the lease deed dated 4th August, 2011 is a permanent lease/perpetual lease. In this regard reference has been made to the clauses contained in the lease deed, to submit that the terms thereof are peculiar and do not provide for any specific number of years. However, the intention of the parties has to be gathered from the terms of the lease and the purpose for which it was given and the conduct of the party. It was submitted that the purpose of the lease appears to be for establishing textile mill or for any other purpose including putting up building thereon. The lease deed does not have any clause which permits the lessor to determine the lease and further provides that till the lessee pays the rent, the lessor has no right to take over the possession and the lessor has no right to increase the rent. It was submitted that all these clauses go to show that the lease was given on a permanent basis. It was further submitted that clause (6) of the deed permits the lessee to sell/transfer, etc. its leasehold rights to any person, which again is a strong indication of the permanent/perpetual lease. It was contended that a consequence of the lease being a perpetual lease is that the lessors cannot claim back possession as there is no forfeiture clause as per the lease deed, which is also a ground mentioned in section 13 of the Rent Act. On the other hand, on behalf of the applicant it has been contended that considering the clauses contained in the lease deed, it is a lease from year to year and is a periodic lease and it contains a clear forfeiture clause.

25. For the purpose of ascertaining the nature of the lease, it may be germane to refer to the recitals contained in the lease deed of 1911, to understand as to what was agreed between the parties and the nature of the lease.

26. The original lease deed is in the vernacular language and as translated in English and to the extent it is relevant for the present purpose, reads as under:-

The opening part of the lease deed refers to the parties and below that is a table showing the description of the land given on lease. Below the table it is stated thus:

"The farmlands within the four boundaries wherein in number 53 there is a well and along with the well we have kept all the farmlands on rent from you for the purpose of constructing buildings for textile mill or similar use or for any other purpose or for use in any other manner. The rent for the same will be Rs.500 per annum payable in advance. The resolution in that regard is as under:

1. The duration of the rent note is till we pay the said amount of rent every year in advance, that is, before the commencement of the year and if in this manner we or our heirs, administrators do not pay the rental amount then you, your heirs, advocates may give three months notice and if within that period we do not pay the rent then we shall remove our buildings and if within the notice period we fail to do so then you, your heirs, advocates may take possession and from then the possession shall be deemed to be yours and if we, our heirs, administrators etc. continue to pay the rental amount as stated above, till the time we give the rent, you or your heirs or administrators shall not have the right to recover possession from us and take possession of the farmlands at any time, also you shall have no right to increase the rent.

2. Xxx

3. As stated in the first clause till we pay the rental amount, you or your guardians, heirs cannot take possession of the farmlands and if you or your heirs in any manner execute any deed in respect of the lands, even then till the rent of the farmlands is paid, they or their heirs or administrators cannot take possession of the lands from us and the sole right shall be to recover the rental amount.

4. xxxxxxx ..

5. Upon digging the farmlands, if any mineral is found then it is yours and we, our guardian, heirs shall not have any right, but if any bricks or stones are found we can use them.

6. If we keep the building constructed on the farmlands and machines installed thereon permanently and transfer them by sale or in any other manner then the same shall be given by retaining all the conditions of the lease deed, whereby the purchaser shall be deemed to have accepted all the conditions of the lease deed.

7. to 9. xxxxx

10. The rent shall start running from 15th June, 1911 and if we have to surrender the farmlands then we cannot surrender them before ten years from the date when they have been kept on rent; despite which if we surrender them then you shall recover ten years rent at a time from us or our guardians or heirs and we or our guardians or heirs shall not raise any dispute and if we want to surrender the lands after ten years, then in the year in which they are surrendered we shall not raise any dispute or seek any right to refund of the rent paid for that year prior thereto and if we want to surrender the lands, we shall remove the construction on the lands from the foundation and level the land and hand over the possession to you and if you have to do it, you shall be entitled to recover the entire costs from us.

11. & 12. Xxxx

13. Under all the clauses referred to hereinabove, wherever "we" has been written it at every place it should be understood as, we, our guardians, heirs, administrators and wherever your has been written there it should be understood as you, your guardian, heirs , advocates, assignees ..... ...

27. On a perusal of the above clauses of the lease deed, it is manifest that nowhere in the entire lease deed has it been stated that the lease is a permanent or a perpetual one. Therefore, what has to be examined is the intention of the parties upon consideration of the agreement as a whole.

28. Clause (1) of the lease deed, which is the first condition, provides that the duration of the lease deed is till the lessee pays the rent annually in advance before the commencement of the year; and in case of default, the lessor can give three months notice, and upon failure on the part of the lessee to pay the rental amount within the notice period, the lessor is entitled to take possession and is deemed to be in possession. Thus, this clause provides for the duration of lease, which is indefinite, but terminable on the happening of an event, namely, failure to pay the rent. Thus, this condition can be termed to be a forfeiture clause.

29. It may be noted that while clause 13 of the lease deed says that in the lease deed where 'we' is mentioned it should be understood as 'we, our heirs, administrators, assignees', and where 'you' is mentioned it should be understood as 'your guardian, heirs, advocates, assignees'but nowhere does it say that the lease is heritable.

30. On a perusal of clause (3) of the lease deed, which is the clause which permits transfer of the leasehold rights, shows that what the parties intended was transfer of the subject property with building, plant and machinery which were permanent in nature, and not vacant land. Therefore, the intention of the parties appears to be to permit transfer of leasehold rights as a going concern.

31. Clause 10 of the lease deed provides for a minimum term of the lease, viz. ten years, for which the lessee is bound to pay the rent, even if he surrenders the land before the expiry of ten years. Thereafter, there is no terminus as to till when the lease should continue, but it is terminable at the instance of the lessee, provided that the lessee would not be entitled to recover the amount paid in advance for the year in which the lease is relinquished. In terms of the decision of the Supreme Court in Chapsibhai Dhanjibhai Danad v. Purushottam (supra), this can be said to be indicative of the intention of the parties not to create a permanent lease. Besides, clause 10 further provides that when the lessee relinquishes the lease, he shall remove all the buildings from the foundation and level the land. The clause providing for such removal is not that the lessee would remove the structures on default in payment of rent, but depends on his own volition, which in terms of the decision of the Supreme Court in Chapsibhai Dhanjibhai Danad v. Purushottam (supra) is a clause indicative of the parties not having intended the lease to be permanent. For, if it was intended to be permanent, there was no necessity for providing such a right. In the opinion of this court, having regard to the terms and conditions of the lease deed of 1911, it is the decision of the Supreme Court in Chapsibhai Dhanjibhai Danad v. Purushottam (supra) which would more appropriately be applicable and not the decision in Sivayogeswara Cotton Press (supra).

32. In Hamidullah (Dead) By his Legal Representatives v. Sheikh Abdullah, (supra), the Supreme Court referred to its earlier decision in the case of Bejoy Gopal Mukherji v. Praful Chandra Ghose, AIR 1953 SC 153, wherein it was held that neither possession for generations at uniform rent nor construction of permanent structures by itself is conclusive proof of permanent tenancy. It is a cumulative effect of these circumstances coupled with several other facts that may lead to an inference of permanent tenancy.

33. In the light of the above discussion, it appears that while the duration of the lease is indefinite, it is not permanent in nature.

34. On behalf of the applicant, reliance has been placed upon the decision of this court in the case of Nanalal Girdharlal and another v. Gulamnabi Jamalbhai Motorwala, (supra) for the purpose of contending that the lease deed of 1911 is a periodic lease. In the above decision, a Full Bench of this court was considering the true nature and character of a periodic lease. The court observed that it is evident that the duration of the term in a periodic lease is continuous from period to period. The interest of the lessee does not terminate at the end of the period but continues indefinitely from period to period until determined by a notice to quit given by the lessor or the lessee. The court observed that the characteristics of a periodic tenancy from year to year have been stated with great clarity and precision by the Court of Exchequer Chamber in the early case of Grandy v. Jubber. (1868) 9 B. & S. 15, wherein it was held thus:

"There frequently is an actual demise from year to year so long as both parties please. The nature of this tenancy is discussed in 4 Bac. Abr. Lit. Lease and Terms for years pp. 838. 839. 7th ed., and the article has always been deemed of the highest authority. It seems clear that the learned author considered that the true nature of such a tenancy is that it is a lease for two years certain, and that every year after it is a springing interest arising upon the first contract and parcel of it so that if the lessee occupies for a number of years, these years by computation from the time past, make an entire lease for so many years, and that after the commencement of each new year it becomes an entire lease certain for the years past and also for the year so entered on and that it is not a reletting at the commencement of the third and subsequent years. We think this is the true nature of a tenancy from year to year created by express words, and that there is not in contemplation of law a recommencing or reletting at the beginning of each year."

The Full Bench held that when one period comes to an end and the tenancy goes into the next period, it does so by virtue of the original contract of lease and as a direct consequence of it and not because of any fresh contract of reletting. There is no common assent between the lessor and the lessee arrived at afresh for continuing the tenancy into the next period. The tenancy goes on from period to period by force of the original contract of lease until the contract is determined by notice to quit on the part of either lessor or lessee.

35. In the opinion of this court, the lease in question cannot be said to be a periodic lease, inasmuch as, in terms of the above decision, the contract is determinable by notice to quit on the part of either lessor or lessee, whereas in the facts of the present case, the lessor has no right to issue a notice to quit except in the case of non-payment of rent.

36. Assuming for the sake of argument that the lease of 1911 is a permanent lease, the next question that arises for consideration is whether Jubilee Mills through the Official Liquidator is entitled to the benefit of such lease.

37. From the facts as noted hereinabove, it emerges that the lease deed of 1911 was executed between the predecessors of the applicant and Ahmedabad Jubilee Spinning and Manufacturing Company (Ahmedabad Manufacturing Company). Thereafter, Ahmedabad Manufacturing Company executed an agreement dated 29.03.1941 in favour of Ahmedabad Manufacturing and Calico Printing Company Limited (Calico Limited) by way of a registered deed. Thus, the leasehold rights of Ahmedabad Manufacturing Company came to be transferred in favour of Calico Limited. Thereafter, Calico Limited executed an unregistered deed dated 24.06.1983 in favour of Gaurav Chemtex Industries Limited ( Gaurav Chemtex/Jubilee Mills) whereby the vendor, that is, Calico Limited transferred to the purchaser one of the divisions of the vendor company viz. Jubilee Mills as a going concern, together with the assets, property rights and benefit thereof.

38. On behalf of the applicant, it has been contended that the lease deed dated 24.6.1983 being an unregistered deed, there is no lawful assignment of leasehold rights in favour of Jubilee Mills.

39. The aforesaid contention has to be examined in the light of the provisions of the Transfer of Property Act and the Registration Act as well as the decisions cited by the learned counsel for the respective parties.

40. Section 107 of the Transfer of Property Act says that a lease of immovable property from year to year, or for any term exceeding one year or reserving a yearly rent, can be made only by a registered instrument. All other leases of immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession. Thus, the mandate under section 107 of the Transfer of Property Act is that in case of a lease of immovable property exceeding one year, the same can be made only by a registered document.

41. Section 17 of the Registration Act, bears the heading "Documents of which registration is compulsory". Sub-section (1) of section 17 provides that the documents specified thereunder shall be registered. The present case falls under clause (d) thereof which reads thus: "leases of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent".

42. Section 49 of the Registration Act provides for the effect of non-registration of documents required to be registered and reads as under:-

"49. Effect of non-registration of documents required to be registered - No document required by section 17 or by any provision of the Transfer of Property Act, 1882 (4 of 1882), to be registered shall -

(a) affect any immovable property comprised therein, or

(b) confer any power to adopt, or

(c) be received as evidence of any transaction affecting such property or conferring such power, unless it has been registered;

Provided that an unregistered document affecting immovable property and required under that Act or the Transfer of Property Act (4 of 1882) to be registered may be received in evidence of a contract in a suit for specific performance under Chapter II of the Specific Relief Act, 1877 (3 of 1877), or as evidence of any collateral transaction not required to be effected by registered instrument."

43. On behalf of the Official Liquidator, it has been contended in the light of the proviso to section 49 of the Registration Act, it is permissible for the Official Liquidator to rely upon the unregistered agreement as evidence of any collateral transaction not required to be effected by registered instrument, though he may not be able to claim title to the property on the basis of such agreement. To test this contention, reference may be made to the decision of the Supreme Court in Anthony v. K C Itoop & Sons (supra), wherein, the court, in the context of section 107 of the Transfer of Property Act and sections 17 and 49 of the Registration Act and the facts of the said case where the lease deed was unregistered, held that such an instrument cannot create a lease on account of three-pronged statutory inhibitions contained in section 107 of the Transfer of Property Act, section 17(1) and section 49 of the Registration Act. The court further held that the said finding does not exhaust the scope of the issue whether the appellant therein was a lessee of the building. The court referred to the definition of lease of immovable property as defined in section 105 of the Transfer of Property Act and has held once there is a transfer of right to enjoy the property, a lease stands created. The court referred to the three paragraphs of the first part of section 107 of the Transfer of Property Act and observed that the first paragraph deals with the mode of creating the particular kinds of leases mentioned therein and the third paragraph can be read along with the above as it contains a condition to be complied with if the parties choose to create a lease as per a registered instrument mentioned therein. All other leases, if created, necessarily fall within the ambit of the second paragraph. Thus, de hors the instrument parties can create a lease as envisaged in the second paragraph of section 107 which reads thus:

"All other leases of immovable property may be made either by a registered instrument or by oral agreement accompanied by delivery of possession."

44. In Samir Mukherjee v. Davinder K. Bajaj (supra), the Supreme Court held that under section 107 of the Transfer of Property Act, parties have an option to enter into a lease in respect of an immovable property either for a term less than a year or from year to year, for any term exceeding one year or reserving a yearly rent. If they decide upon having a lease in respect of any immovable property from year to year or for any term exceeding one year, or reserving a yearly rent, such a lease has to be only by a registered instrument. In the absence of a registered instrument, no valid lease from year to year or for a term exceeding one year or reserving a yearly rent can be created.

45. In K.B. Saha & Sons (P) Ltd. v. Development Consultant Ltd. (supra), the Supreme Court culled out the following principles:-

1. A document required to be registered, if unregistered is not admissible into evidence under section 49 of the Registration Act.

2. Such unregistered document can however be used as an evidence of collateral purpose as provided in the proviso to section 49 of the Registration Act.

3. A collateral transaction must be independent of, or divisible from, the transaction to effect which the law required registration.

4. A collateral transaction must be a transaction not itself required to be effected by a registered document, that is, a transaction creating, etc. any right, title or interest in immovable property of the value of one hundred rupees and upwards.

5. If a document is inadmissible in evidence for want of registration, none of its terms can be admitted in evidence and that to use a document for the purpose of proving an important clause would not be using it as a collateral purpose.

45. In Anthony v. K.C. Ittoop (supra) the Supreme Court held that since the instrument of lease was unregistered there was no scope of holding the appellant lessee by virtue of the said instrument. It was further held that the court is disabled from using the instrument as evidence and hence it goes out of consideration in that case, hook, line and sinker. The court however held that the above finding does not exhaust the scope of the issue whether the appellant was a lessee of the building. The court observed that when a lease is a transfer of a right to enjoy the property and such transfer can be made expressly or by implication, the mere fact that an unregistered document came into existence would not stand in the way of the court to determine whether there was in fact a lease otherwise than through such deed. The court held that when it is admitted by both the sides that the appellant was inducted into the possession of the building by the owner thereof and that the appellant was paying monthly rent or had agreed to pay rent in respect of the building, the legal character of the appellant's possession has to be attributed to a jural relationship between the parties. Such a jural relationship on the fact situation of the case, cannot be placed anything different from that of lessor and lessee falling within the purview of the second paragraph of section 107 of the Transfer of Property Act. The court held that since the lease could not fall within the first paragraph of section 107 it could not have been for a period exceeding one year. The court observed that the further presumption is that the lease would fall within the ambit of residuary second paragraph of section 107 of the Transfer of Property Act and that taking a different view would be contrary to the reality when parties clearly intended to create a lease though the document which they executed had not gone into the processes of registration. That lacuna had affected the validity of the document, but what had happened between the parties in respect of the property became a reality. Non-registration of the document had caused only two consequences. One is that no lease exceeding one year was created. Second is that the instrument became useless so far as creation of the lease is concerned. Nonetheless the presumption that a lease not exceeding one year stood created by conduct of parties remains unrebutted.

46. In Park Street Properties (P) Ltd. v. Dipak Kumar Singh (supra) the Supreme Court relied upon its earlier decision in Anthony v. K.C. Ittoop (supra) and held that in the absence of registration of a document, what is deemed to be created is a month-to-month tenancy, the termination of which is governed by section 106 of the Transfer of Property Act.

47. In Suraj Lamp & Industries (P) Ltd. (2) v. State of Haryana (supra), the Supreme Court has held that a lease can be validly transferred only under a registered assignment of lease.

48. As to what rights flow in favour of Jubilee Mills under the agreement dated 24.6.1983, it is required to be examined in the light of the above decisions and statutory provisions,. It is an admitted position that the said agreement is an unregistered document. Since the agreement of 1983 purports to convey the leasehold rights under the agreement of 1911, which is for a period exceeding one year, in the light of the provisions of section 107 of the Transfer of Property Act, such lease can be created only by a registered instrument. Similarly under section 17(1)(d) of the Registration Act also, a lease deed of an immovable property for any term exceeding one year is compulsorily required to be registered.

49. Section 107 of the Transfer of Property Act provides for (i) a lease deed of immovable property exceeding one year to be made only by a registered instrument; (ii) all other leases of immovable property may be either by a registered instrument or by oral agreement accompanied by delivery of possession;

(iii) where lease of immovable property is made by a registered instrument, such instrument or where there are more instruments than one, each such instrument shall be executed by both the lessor and the lessee. In the present case, since under the agreement of 1983, leasehold rights for a term exceeding one year under the lease deed of 1911 which relates to immovable property are transferred, in view of the provisions of section 107 of the Transfer of Property Act and section 17 of the Registration Act, it is required to be registered. However, as held by the Supreme Court in the above referred decisions, in the absence of registration no valid lease from year to year or for a term exceeding one year or reserving a yearly rent can be created. However, as held by the Supreme Court in Anthony v. K C Itoop & Sons (supra), non-registration of the document causes two consequences: (i) that no lease exceeding one year is created; and (ii) that the instrument becomes useless so far as creation of the lease is concerned. Nonetheless, there is a presumption that the lease would fall within the ambit of residuary second paragraph of section 107 of the Transfer of Property Act. As held by the Supreme Court in Park Street Properties (P) Ltd. v. Dipak Kumar Singh (supra), in the absence of registration of a document, what is deemed to be created is a month-to-month tenancy, the termination of which is governed by section 106 of the Transfer of Property Act.

50. Thus, in the light of the principles enunciated in the above decisions, the unregistered agreement dated 26th April, 1983 is deemed to create a month-to-month tenancy, termination whereof is governed by section 106 of the Transfer of Property Act.

51. Another question which is required to be addressed is whether it is permissible for Jubilee Mills to fall back upon the agreement of 1911 for contending that its rights flow under the said agreement and that in view of the terms and conditions of the said agreement, the provisions of the Rent Act would not apply.

52. In this regard, reference may be made to the decision of the Supreme Court in Bajaj Auto Ltd. v. Behari Lal Kohli, (supra), wherein it was urged on behalf of the appellant therein that in view of the provisions of section 49 of the Registration Act, it is entitled to rely upon an unregistered document for "collateral purpose". The court held that the clause in the lease deed could not be looked into for want of registration of lease deed. Reference was made to the decision of the Supreme Court in Sachindra Mohan Ghose v. Ramjash Agarwalla, (1988) 1 SCC 70, for the proposition that if a decree purporting to create a lease is inadmissible in evidence for want of registration, none of the terms of the lease can be admitted in evidence and that to use a document for the purpose of proving an important clause in the lease is not using it as a collateral purpose. The court held that the question whether the lessee is entitled to create a sub-lease or not is undoubtedly a term of the transaction of lease, and if it is incorporated in the document, it cannot be disassociated from the lease and considered separately in isolation. If a document is inadmissible for non-registration, all its terms are inadmissible including the one dealing with landlord's permission to his tenant to sub-let. The court, accordingly, held that the appellant therein could not be allowed to rely upon the clause in his unregistered lease deed.

53. In K.B. Saha & Sons (P) Ltd. v. Development Consultant Ltd.(supra), the Supreme Court held that a document required to be registered, if unregistered is not admissible into evidence under section 49 of the Registration Act. Such unregistered document can however be used as an evidence of collateral purpose as provided in the proviso to section 49 of the Registration Act. The court held that a collateral transaction must be independent of, or divisible from, the transaction to effect which the law required registration. A collateral transaction must be a transaction not itself required to be effected by a registered document, that is, a transaction creating, etc. any right, title or interest in immovable property of the value of one hundred rupees and upwards. If a document is inadmissible in evidence for want of registration, none of its terms can be admitted in evidence and that to use a document for the purpose of proving an important clause would not be using it as a collateral purpose.

54. In the facts of the present case, on behalf of the Official Liquidator of Jubilee Mills, reliance has been placed upon the clauses of the lease deed of 1911, to submit that the lease is of a permanent nature and that the same permits the lessee to transfer and further assign the leasehold rights. It cannot be gainsaid that the condition which permits the lessee to transfer the leasehold rights is an important condition of the lease deed. The Official Liquidator seeks to place reliance upon the condition of lease deed of 1911 on the basis of the transfer of leasehold rights under the unregistered agreement of 1983. Since the condition of transfer of leasehold rights exceeding one year requires a document to be registered, the agreement of 1983 cannot be looked into for the purpose of establishing such right inasmuch as it cannot be said to be a collateral transaction. As held by the Supreme Court, a collateral transaction itself must not be required to be effected by a registered document. The transaction creating any right, title or interest in immovable property of the value of hundred rupees and upwards is not a collateral transaction, and hence, cannot be admitted in evidence. Once the document of 1983 cannot be admitted in evidence, the lease deed of 1911 cannot be looked into as the rights under the lease deed of 1911 are based upon the agreement of 1983 which is an unregistered document. Hence, the agreement of 1983 or the lease deed of 1911 cannot be read in evidence in the facts of the present case.

55. On behalf of the respondents, it has been contended that Calico Limited transferred its leasehold rights of the property to Gaurav Chemtex Industries and the said transfer has been acted upon and complete, as held by this court in the case of ICICI Limited v. Official Liquidator of Ahmedabad Manufacturing and Calico Printing Limited (supra), the title of the land has passed in favour of Jubilee Mills. It is contended that in the light of the observations made in the above decision, and in the light of the fact that the entire transfer has taken place, the provisions of section 53A of the Transfer of Property can be invoked and it is not open for anyone to contend otherwise. In this regard, reference may be made to the above referred decision of this court in ICICI Limited v. Official Liquidator. In that case, ICICI Limited claimed that Calico Limited had created a charge over its immovable property in its favour including assets of its Jubilee Mills Division which were transferred to Gaurav Chemtex Industries. That it was not a party to the agreement dated 24.6.1983 and that Calico Limited continues to be liable and the said property and charge created thereupon continue to be valid in favour of ICICI Limited. The basic question which was required to be considered in that case was, whether the property in question could be said to be of Jubilee Mills and whether ICICI Limited could be said to have any charge over the said property which was in the possession of the Liquidator of Jubilee Mills. The basic controversy, therefore, was about the right, title and interest of ICICI Limited in the subject matter. On behalf of ICICI Limited, a contention was raised that immovable properties owned by Calico could only be transferred by registered conveyance executed by Calico in favour of Jubilee Mills and in the absence of a registered conveyance; the immovable properties continue to be owned by Calico. The court held thus:-

"38. Xxxxxxx I agree with the submission of Mr.A.L. Shah, appearing for the O.L. of the Calico, that the possession of the entire Unit, undertaking, business and operations and its custody and control was handed over to Jubilee pursuant to the Agreement in question and most part of the Agreement was actually performed and in performance of the said Agreement, possession of movable as well as immovable properties were transferred to and handed over to Jubilee and in view of the restriction under the Land Ceiling Act, conveyance of the immovable property could not be executed as the permission and clearance of land ceiling Authorities were awaited. However, simply because of the fact that no conveyance had taken place, the present applicant cannot take advantage of that situation and there is nothing on record to show that there was any subsisting charge in their favour at the relevant time and in absence of the same, naturally, the applicant would not have any locus standi to challenge the said transaction especially when the applicant is a stranger to the said agreement."

However, so far as the facts of the present case are concerned, the question is whether as back as in 1983, the property was transferred by virtue of agreement in favour of Jubilee and whether Jubilee has become the owner from the aforesaid date of transfer having been put in possession of the property in question. From 1983 onwards, the property were in the possession of Jubilee and everybody treated Jubilee as its owner. There is nothing on record to show that at any point of time Calico had ever tried to assert its rights over the property in question. The agreement as such was acted upon. A Reference to Clause 8 is already made earlier and by virtue of the aforesaid transfer itself, the Jubilee had become owner of the same. Real owner Calico had never objected at any point of time asserting any right in their favour in the property in question. The present applicant is not a party to the said Agreement in question. There is nothing to show that there is any valid registered charge in their favour at the time when the property was transferred in the year 1983. In that view of the matter, it is not open for the applicant, therefore, to question the agreement in question or to say that the property, as such, belongs to Calico and for want of a registered document of conveyance, the title has not passed on in favour of Jubilee. It is true that a tenant cannot claim adverse possession. Here, the question is not of adverse possession, but the question is whether Jubilee has become the owner of the property in question by substantially performing the contractual obligations as per the agreement. In the facts and circumstances of the case, therefore, it is not possible to believe that the title has not passed in favour of Jubilee. In any case, it is not open for the present applicant to challenge the aforesaid transaction or even the title of Jubilee as per the facts and circumstances stated hereinabove."

56. Examining the facts of the present case in the light of the above decision, in the present case the applicant is not disputing the transaction between Calico Limited and Jubilee Mills. What is being contended that in view of the fact that the agreement dated 24.6.1983 is not a registered document, it is not a valid deed, and hence, no reliance can be placed on the clauses contained therein by the respondent Jubilee Mills. It is the case of the applicants that section 107 of the Transfer of Property Act mandates that a lease of immovable property from year to year or for any term exceeding one year or reserving a yearly rent can be made only by a registered deed. Since the agreement dated 24.6.1983 is not a registered document, in the light of the principles propounded by the Supreme Court in Anthony v. K.C. Ittoop & Sons (supra) and Park Street Properties (P) Ltd (supra), non registration of the document has two consequences, one is that no lease exceeding one year is created; and secondly, the instrument becomes useless so far as creation of the lease is concerned, but there is a presumption that a lease not exceeding one year stood created by the conduct of the parties. Thus, in the absence of registration of the agreement, what is deemed to be created is a month-to-month tenancy, the termination of which is governed by section 106 of the Transfer of Property Act.

57. The applicant is not disputing that by virtue of the unregistered agreement Calico Limited transferred its leasehold rights in favour of Jubilee Mills. What is contended is that in view of the fact that the agreement of 1983 is unregistered, the lease created in favour of Jubilee Mills does not exceed one year. Besides, as held by the Supreme Court in K.B. Saha & Sons Private Limited v. Development Consultant Limited (supra), a document required to be registered, if unregistered is not admissible in evidence under section 49 of the Registration Act. While such document can be used as evidence of collateral purpose as provided in the proviso to section 49 of the Registration Act, the collateral transaction must be independent, or divisible from the transaction to effect which the law required registration. The collateral transaction must be a transaction not itself required to be effected by a registered document, that is, a transaction creating, any right, title or interest in immovable property of the value of one hundred rupees and upwards. If the document is inadmissible in evidence for want of registration none of its terms can be admitted in evidence and that to use the document for the purpose of proving an important clause would not be using it as a collateral purpose.

58. Adverting to the facts of the present case, the Official Liquidator does not rely upon the agreement for a collateral purpose but for the purpose of proving the lease hold rights of the company in liquidation over the subject property, which is required to be effected by a registered deed. Since the agreement of 1983, being an unregistered document is not admissible in evidence, none of its clauses, including the clause whereby the leasehold rights of Calico Limited are transferred to it can be admitted in evidence. Besides, the controversy involved in the case of ICICI Limited v. Official Liquidator (supra) is confined to the parties to the said dispute and is not a judgment in rem. The rights decided in that case were between Calico Limited and Jubilee Mills and not the lessors and Jubilee Mills and hence, the said decision does not in any manner affect the rights of the applicant. The contention based upon the above referred decision, therefore, does not deserve acceptance.

59. In the opinion of this court, Calico Limited by executing the agreement of 1983 transferred its rights over the subject land to Jubilee Mills, but in the light of the fact that the agreement was not registered, no valid lease from year to year or exceeding one year was created in favour of the Jubilee Mills and what is deemed to be created is month-to-month tenancy. Accordingly, in the absence of the tenancy being governed by the conditions of any contract, the tenancy is a statutory one and would be solely governed by the provisions of the Rent Act.

60. It has been contended on behalf of the respondents that section 53A of the Transfer of Property Act envisages the doctrine of part performance. Ahmedabad Manufacturing has transferred its leasehold rights in the subject property to Calico Limited, which is turn has transferred its leasehold rights to Gaurav Chemtex/Jubilee Mills under the agreement of 1983. Jubilee Mills Ltd. has performed its part of contract under the agreement of 1983, and hence, the doctrine of part performance would be attracted in the present case. Therefore, considering the fact that the agreement of 1983 is not a registered document, while Jubilee Mills may not be in a position to file a suit based on the agreement, it can certainly rely upon the document in its defence under the proviso to section 49 of the Registration Act. It was contended that section 53A of the Transfer of Property Act enables Jubilee Mills to use the deed of 1983 as a shield to protect its possession, though it may not be able to claim title on that basis. Therefore, non-registration of the agreement of 1983 will not give rise to any right in favour of the original lessor to take possession from Jubilee Mills.

61. Section 53A of the Transfer of Property Act reads thus:

53-A. Part performance.--Where any person contracts to transfer for consideration any immovable property by writing signed by him or on his behalf from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty:

and the transferee has, in part performance of the contract, taken possession of the property or any part thereof, or the transferee, being already in possession, continues in possession in part performance of the contract and has done some act in furtherance of the contract, and the transferee has performed or is willing to perform his part of the contract, then, notwithstanding that, where there is an instrument of transfer, that the transfer has not been completed in the manner prescribed therefor by the law for the time being in force, the transferor or any person claiming under him shall be debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract:

Provided that nothing in this section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof.

62. Thus, section 53A of the Transfer of Property Act bars the transferor or any person claiming under him any right in respect of the property of which the transferee has taken or continued to be in possession, from enforcing against the transferee and persons claiming under him any right in respect of the property other than a right expressly provided by the terms of the contract. Insofar as the unregistered agreement of 1983 is concerned, the transferor is Calico Limited and the transferee is Jubilee Mills. Therefore, Calico Limited or any person claiming under it any right in respect of the subject property, for example ICICI Limited which claimed a charge on the subject property through Calico Limited, is barred from claiming any right other than a right expressly provided by the terms of the contract. Thus, the doctrine of part performance under section 53A of the Transfer of Property Act would be applicable to the parties to the agreement and those claiming under them. In the present case, the applicant does not claim any right in the subject property through either the transferor or transferee, and hence, the provisions of section 53A would not be applicable. This view is bolstered by the decision of the Supreme Court in Rambhau Namdeo Gajre v. Narayan Bapuji Dhotra, (2004) 8 SCC 614:

"8. It is seen that many a times a transferee takes possession of the property in part-performance of the contract and he is willing to perform his part of the contract. However, the transferor somehow or the other does not complete the transaction by executing a registered deed in favour of the transferee, which is required under the law. At times, he tries to get back the possession of the property. In equity, the courts in England held that it would be unfair to allow the transferor to take advantage of his own fault and evict the transferee from the property. The doctrine of part-performance aims at protecting the possession of such transferee provided certain conditions contemplated by Section 53-A are fulfilled. The essential conditions which are required to be fulfilled if a transferee wants to defend or protect his possession under Section 53-A of the Act that have been culled out by this Court in Shrimant Shamrao Suryavanshi v. Pralhad Bhairoba Suryavanshi, (2002) 3 SCC 676 are:

"16. (1) there must be a contract to transfer for consideration of any immovable property;

(2) the contract must be in writing, signed by the transferor, or by someone on his behalf;

(3) the writing must be in such words from which the terms necessary to construe the transfer can be ascertained;

(4) the transferee must in part-performance of the contract take possession of the property, or of any part thereof;

(5) the transferee must have done some act in furtherance of the contract; and (6) the transferee must have performed or be willing to perform his part of the contract."

9. If these conditions are fulfilled then in a given case there is an equity in favour of the proposed transferee who can protect his possession against the proposed transferor even though a registered deed conveying the title is not executed by the proposed transferor. In such a situation equitable doctrine of part-performance provided under Section 53-A comes into play and provides that:

"the transferor or any person claiming under him shall be debarred from enforcing against the transferee and persons claming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract".

10. Protection provided under Section 53-A of the Act to the proposed transferee is a shield only against the transferor. It disentitles the transferor from disturbing the possession of the proposed transferee who is put in possession in pursuance of such an agreement. It has nothing to do with the ownership of the proposed transferor who remains full owner of the property till it is legally conveyed by executing a registered sale deed in favour of the transferee. Such a right to protect possession against the proposed vendor cannot be pressed into service against a third party."

(Emphasis supplied.)

Thus, the Official Liquidator of Jubilee Mills cannot press into service the right to protect possession against Calico Limited against the applicant herein.

63. Since the applicant seeks possession of the subject property from the Official Liquidator, reference may be made to the relevant provisions of the Rent Act. Sub-section (8) of section 5 of the Rent Act defines "premises"inter alia to mean any land not being used for agricultural purposes. Sub-section (11) of section 5 of the Rent Act defines "tenant" to mean any person by whom or on whose account rent is payable for any premises and inter alia includes,- (a) such sub-tenants and other persons as have derived title under a tenant before the commencement of the Bombay Rents, Hotel and Lodging House Rates Control (Amendment) Ordinance,1959

64. Part II of the Rent Act is comprised of sections 6 to 31A.

Section 6 of the Rent Act bears the heading "Application". Sub- section (1) of section 6 provides that in areas specified in Schedule I, that Part shall apply to premises let for residence, education, business, trade or storage and also to open land let for building purposes. A perusal of the Schedule I of the Rent Act shows that the suit property is located in an area falling under the said Schedule.

65. Section 12 of the Rent Act, to the extent the same is relevant for the present purpose, reads as under:

"12. No ejectment ordinarily to be made if tenant pays or is ready and willing to pay standard rent and permitted increases. - (1) A landlord shall not be entitled to the recovery of possession of any premises so long as the tenant pays, or is ready and willing to pay, the amount of the standard rent and permitted increases, if any, and observes and performs the other conditions of the tenancy, in so far as they are consistent with the provisions of this Act.

xxxxxxx (2) No suit for recovery of possession shall be instituted by a landlord against a tenant on the ground of non- payment of the standard rent or permitted increases due, until the expiration of one month next after notice in writing of the demand of the standard rent or permitted increases has been served upon the tenant in the manner provided in section 106 of the Transfer of Property Act, 1882 (IV of 1882).

3(a) xxxx

(b) In any other case, no decree for eviction shall be passed in any such suit if, on the first day of hearing of the suit or on or before such other date as the Court may fix, the tenant pays or tenders in Court the standard rent and permitted increases then due and thereafter,-

(i) continues to pay or tender in Court such rent and permitted increases till the suit is finally decided; and

(ii) pays costs of the suit, as directed by the Court."

66. Section 13 of the Rent Act to the extent the same is relevant for the present purpose reads as under:

"13. When landlord may recover possession. - (1) Notwithstanding anything contained in this Act [but subject to the provisions of Section 15] a landlord shall be entitled to recover possession of any premises if the Court is satisfied.-

(a) xxxxx

(b) xxxxx

(c) xxxxx

(d) xxxx

(e) that the tenant has, since the coming into operation of this Act lawfully [sub-let] the whole or part of the premises or assigned or transferred in any other manner his interest therein; or

(f) xxxx

(g) that the premises are reasonably and bona fide required by the landlord for occupation by himself or by any person for whose benefit the premises are held [where the landlord is a trustee of a public charitable trust that the premises are required for occupation for the purpose of the trust; or

(h) xxxx

(i) xxxx

(k) that the premises have not been used without reasonable cause for the purpose for which they were let for a continuous period of six months immediately preceding the date of the suit"

67. Thus, the Bombay Rent Act envisages recovery of possession by the landlord under the two provisions, namely, section 12 and section 13 thereof. On behalf of the Official Liquidator, it has been contended that sub-section (1) of section 13 of the Rent Act provides that the same is subject to the provisions of section 15. Referring to section 15, it was submitted that the same provides that notwithstanding anything contained in any law, but subject to any contract to the contrary. Therefore, if there is a contract to the contrary permitting the lessee to sublet the transfer the premises, clause (e) of sub-section (1) of section 13 of the Rent Act cannot be invoked. Reliance was placed upon the decision of the Supreme Court in Laxmidas Bapudas Darbar v. Smt. Rudravva (supra, wherein the court observed that in V. Dhanapal Chettiar v. Yesodai Ammal, AIR 1979 SC 1745, it has nowhere been held that by virtue of the provisions of the Rent Act the contract of term lease is completely obliterated in all respects. The effect of the Rent Act on tenancy under contract has been considered only to a limited extent, confining it to the necessity of giving notice under section 106 of the Transfer of Property Act. The court, in the context of section 21 of the Karnataka Rent Control Act, observed that the Rent Acts have primarily been made, if not wholly, to protect the interest of tenants, to restrict charging of excessive rent and their rampant eviction at will. In that view of the matter, section 21 of the Karnataka Rent Act provides that notwithstanding anything to the contrary contained in any contract, no order for eviction of a tenant shall be made by the court or any other authority. The court held that the non obstante clause contained under section 21 of the Act, will override any condition in any contract which may provide a ground for eviction other than those enumerated in clauses (a) to (p) of sub-section (1) of section 21. Such an additional ground in a contract shall be rendered ineffective. The court observed that the use of the word "only" in the proviso is significant to emphasise that it relates to grounds alone which cannot be added over and above as provided. The whole contract or other conditions not related to eviction or grounds of eviction shall not be affected. So far as a fixed term lease is concerned, it shall be affected only to the extent that even after expiry of period of the lease the possession cannot be obtained by the lessor unless one or more of the grounds contained in section 21 of the Act are available for eviction of the tenant. There is nothing to indicate nor has it been held in any case that in view of section 21 of the Karnataka Rent Act a contract of fixed term tenancy stands obliterated in totality. The court observed that as indicated in the earlier part of the judgment in the case of Dhanapal Chettiar (supra) it has been observed in paragraph 5 that none of the State Rent Acts have abrogated or affected the provisions of section 107 of the Transfer of Property Act which provides for lease of immovable property from year to year or for a term more than a year or reserving a yearly rent. The court held that the proviso to sub-section (1) of section 21 of the Karnataka Rent Act limits the grounds on which a landlord can seek eviction of a tenant. The court further held thus:

"18. The effect of the non obstante clause contained under Section 21 of the Karnataka Rent Act on the fixed term contractual lease may be explained as follows:

(i) On expiry of period of the fixed term lease, the tenant would be liable for eviction only on the grounds as enumerated in clauses (a) to (p) of sub- section (1) of Section 21 of the Act.

(ii) Any ground contained in the agreement of lease other than or in addition to the grounds enumerated in clauses (a) to (p) of sub-section (1) of section 21 of the Act shall remain inoperative.

(iii) Proceedings for eviction of a tenant under a fixed term contractual lease can be initiated during subsistence or currency of the lease only on a ground as may be enumerated in clauses (a) to (p) of sub- section (1) of Section 21 of the Act and it is also provided as one of the grounds for forfeiture of the lease rights in the lease deed, not otherwise.

(iv) The period of fixed-term lease is ensured and remains protected except in the cases indicated in the preceding paragraph."

68. In the opinion of this court, the above decision of the Supreme Court would be applicable provided there is a contract to the contrary as contemplated under sub-section (1) of section 15 of the Rent Act. In the light of what is held hereinabove, in the absence of any valid contract assigning leasehold rights in favour of Jubilee Mills, the decision of the Supreme Court in Laxmidas Bapudas Darbar v. Rudravva (Smt) (supra) does not in any manner support the case of the Official Liquidator.

69. On behalf of the Official Liquidator it was submitted that none of the grounds under sub-section (1) of section 13 of the Rent Act, on which Jubilee Mills is sought to be evicted from the subject property are made out in the present case. It was submitted that clause (e) of sub-section (1) of section 13 the Rent Act would not be applicable as there is no forfeiture clause in the lease deed dated 04.08.1911. On the other hand, the applicant seeks eviction of the respondent-Jubilee Mills on the ground that the sub-lease in favour of the Jubilee Mills is unlawful because it violates the provisions of the Registration Act and the Transfer of Property Act because it is not registered and it also violates the provisions of the Rent Act because Calico Limited itself was a sub-lessee and the original lessee was Ahmedabad Manufacturing Company, which assigned it to Calico Limited in 1941. Therefore, the status of the Calico was that of a sub-lessee and a sub-lessee cannot further sublet under the provisions of the Rent Act. It was also contended that the premises have not been used without any reasonable cause for the purpose for which they were let for a continuous period of six months immediately preceding the date of the application as contemplated under clause (k) of section 13(1) of the Rent Act. It was also contended that by a notice dated 02.09.2016, the respondent-Jubilee Mills had been called upon to pay Rs.10,500/- towards pending arrears of rent within a period of one month from the date of such notice. However, despite expiration of one month after such notice in writing of demand of the rent came to be issued to it, such amount had not been paid, and that an amount of Rs.10,000/- came to be paid only on 10.01.2017 and Rs.500/- came to be paid on 04.04.2017, therefore, in view of the provisions of sub-section (2) of section 12 of the Rent Act, the Official Liquidator is required to be evicted from the subject property.

70. Insofar as non-payment of rent is concerned, it has been contended on behalf of the Official Liquidator that on account of nonpayment of rent, no action can be taken for eviction of the tenant as section 13 of the Rent Act does not envisage eviction on the ground of nonpayment of rent. In this regard, reliance has been placed on the decision of the Full Bench of the Karnataka High Court in Sri Ramakrishna Theatres Ltd. (supra) which was approved by the Supreme Court in Laxmidas Bapudas Darbar v. Rudravva (supra). The decision in Sri Ramakrishna Theatres Ltd. was rendered in the context of section 21 of the Karnataka Rent Act, which reads thus:

"21. Protection of tenants against eviction.-- (1) Notwithstanding anything to the contrary contained in any other law or contract, no order or decree for the recovery of possession of any premises shall be made by any Court or other authority in favour of the landlord against the tenant :

Provided that the court may on an application made to make an order for the recovery of possession of a premises on one or more of the following grounds only, namely :

(a) Xxx to (p)"

Clauses (a) to (p) enumerate the grounds enabling the landlord to recover possession of the premises from the tenant.

The court inter alia held thus:

"9. A plain reading of the opening sentence of Section 21 would show that it imposes a general ban against the recovery of possession by the landlord of any premises by evicting the tenant. The substance of the main clause in Section 21(1) is to direct that "no order or decree for the recovery of possession of any premises shall be made in favour of the landlord against the tenant". But this clause is not to be read in isolation. It will have to be read along with the opening clause. In other words it says that, even though any other law or contract enables the landlord to recover possession of the premises by an order or decree, no order or decree shall be made by any court of authority. The bar is actually against the court or the authority from making an order or decree for the recovery of possession of any premises in favour of the landlord against the tenant even though any other law or contracts provides for making such an order or decree. Nowhere this main provision has expressed an intention to enlarge, the right of the landlord to get an order or decree for the recovery of possession of the premises. This ban imposed under Sec. 21(1) is lifted under certain circumstances; that is to say, if the grounds enumerated in any one of the clauses (a) to (p) are available, the bar against recovery of possession as stated in Section 21(1) stands lifted.

Thus, the main part of Section 21(1) bars the enforcement of the landlord's right to recover possession from the tenant; the latter is protected from eviction absolutely. This normal rule of a ban against eviction and the protection afforded to the tenant against evictions has to give way only when any one of the grounds enumerated in clauses (a) to (p), exists. In other words, a landlord who is otherwise entitled to evict his tenant, can recover possession from his tenant, only, under any of the circumstances falling under clauses (a) to (p) of the Proviso to Section 21(1).

10. Thus a plain reading of the main provision of Section 21 along with its proviso shows that its object is not to enlarge the rights of the landlord in any manner but actually it is restrictive of his right to recover possession. For example, if the lease is for a fixed term, under general law, the said contract of lease would enable the landlord to seek an order or decree for the recovery of possession of the leasehold on the expiry of the lease period. Such a right is completely taken away by the main provision of S. 21(1) because the said right is a right, which is contrary to the ban imposed by the section. The ban would operate at the time recovery of possession is to be sought and it will be lifted only when any one of the grounds stated in clauses (a) to (p) are proved. The grounds stated in clauses (a) to (p) of the proviso do not enlarge the rights of the landlord but give him cause, or causes of action to seek possession of the premises."

71. In this regard, it may be germane to refer to sub-section (1) of section 13 of the Rent Act, which, to the extent the same is relevant for the present purpose, reads thus:

13. When landlord may recover possession. - (1) Notwithstanding anything contained in this Act but subject to the provisions of section 15, a landlord shall be entitled to recover possession of any premises if the Court is satisfied-

(a) that, the tenant has committed any act contrary to the provisions of clause (o) of section 108 of the Transfer of Property Act, 1882 (IV of 1882); or -

(b)xxxx; or

(c) xxxxx; or

(d) xxxxx; or

(e) that the tenant has, since the coming into operation of this Act lawfully sub-let the whole or part of the premises or assigned or transferred in any other manner his interest therein; or (ee) xxxx; to (hh) or

(k) that the premises have not been used without reasonable cause for the purpose for which they were let for a continuous period of six months immediately preceding the date of the suit; or

(l)xxxxx.

72. Thus, section 21 of the Karnataka Rent Control Act makes provision for protection of tenants against eviction, whereas section 13 of the Bombay Rent Act provides for the grounds under which a landlord may recover possession. Moreover, section 21 of the Karnataka Rent Act provides that recovery of possession can be made on one or more of the grounds enumerated thereunder only. In other words, it limits eviction under the said Act to the contingencies mentioned in section 21 only. Whereas, sub-section (1) of section 13 of the Bombay Rent Act does not employ the expression 'only' and, therefore, does not limit eviction under the said Act to the grounds mentioned thereunder. Therefore, the sub-section (1) section 13 cannot be read to mean that eviction under the Rent Act can be only on the grounds laid down therein as is sought to be contended on behalf of the respondents. In the opinion of this court, while invocation of section 13 of the Rent Act may be restricted to the grounds specifically provided thereunder, it would still be permissible for a landlord to seek eviction of the tenant under section 12 of the Rent Act, if the requirements of sub-section (2) thereof are satisfied. The contention of eviction cannot be sought on the ground of nonpayment of rent because section 13 of the Act does not envisage recovery on such ground, therefore, does not merit acceptance.

73. Examining the issue from another angle, if such contention were to be accepted, the same would render the provisions of sub-section (2) of section 12 of the Rent Act nugatory, which could not have been the intention of the legislature.

74. The next question that arises for consideration is whether the present case falls under any of the clauses enumerated in sub-section (1) of section 13 of the Rent Act.

75. It has been contended on behalf of the applicant that clause (11) of section 5 of the Act which defines "tenant" to include sub tenants and other persons as have derived title under a tenant before the commencement of the Bombay Rents, Hotel and Lodging House Rates Control (Amendment) Ordinance, 1959 and hence, Ahmedabad Manufacturing Company being a tenant, Calico Limited was a sub-tenant and a sub-tenant has no right to further sub-let the premises under the provisions of section 15 (1) of the Act. In this regard, it may be noted that under condition (6) of the lease deed of 1911, it was permissible for the lessee to transfer the subject property with the buildings and machinery thereon. Accordingly, Ahmedabad Manufacturing Company, by a registered agreement dated 29th March, 1941, sold its entire undertaking along with the leasehold rights in the subject property in favour of Calico Limited. Moreover, the assignment of leasehold rights in favour of Calico Limited was prior to the commencement of the Bombay Rents, Hotel and Lodging House Rates Control (Amendment) Ordinance, 1959. Therefore, in terms of section 5(11) of the Rent Act, Calico Limited would be the tenant and not Ahmedabad Manufacturing Company as it sought to be contended on behalf of the applicant.

76. Under sub-section (1) of section 15 of the Rent Act, there is no prohibition against the tenant subletting the premises subject to the any contract to the contrary. Since the Calico Limited under the agreement of 1941 was assigned the rights under the lease deed of 1911, which contained a clause permitting transfer of the subject property, the transfer from Calico Limited in favour of Jubilee Mills cannot be said to be in breach of the provisions of sub-section (1) of section 15 of the Rent Act.

77. Insofar as the contention that as the agreement of 1987 is not a registered one, it is contrary to the provisions of section 17 of the Registration Act and is, therefore, unlawful and, therefore, the applicant is entitled to recover possession under section 13(1)(e) of the Rent Act is concerned, in the opinion of this court, the mere fact that the agreement of 1983 was unregistered, would not amount to the sub-letting being unlawful. As held by the Supreme Court in Anthony v. K.C. Ittoop & Sons (supra), where the lease deed is unregistered, the presumption is that it would fall within the ambit of the residuary second paragraph of section 107 of the Transfer of Property Act, viz. that it is a lease for a period not exceeding one year. The ingredients of section 13(1)(e) of the Rent Act are, therefore, not established in the present case.

78. Insofar as non user of the premises in question is concerned, as contemplated under clause (k) of section 13(1) of the Rent Act is concerned, in Jabal Lashkari (supra), the Supreme Court, in the facts of that case has held that clause (5) of the lease deed which deals with non user of the lease land does not contemplate eviction on account of such non user, but merely entitles the lessor to receive rent for the period of such non user of the land. In the facts of the present case, a perusal of the terms and conditions of the lease deed of 1911 indicates that the same does not contemplate any specific purpose for which the subject land was leased and permits user of the land for any purpose. There is no condition providing for eviction of the lessee on the ground of non user. Besides, it has been held hereinabove that the agreement of 1983 not being registered, the clauses of the said agreement as well as the lease deed of 1911 cannot be read in evidence in this case. Consequently, in the absence of any condition prescribing the purpose for which the premises are to be used or for eviction on the ground of non user, the provisions of clause (k) of section 13 (1) of the Rent Act cannot be invoked.

79. The next question that arises for consideration is whether the applicant is entitled to recover possession of the subject property under sub-section (2) of section

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12 of the Rent Act. Under sub-section (2) of section 12 of the Rent Act, if the tenant does not pay the rent, then the landlord may issue notice in writing demanding payment of such rent and serve the same on the tenant in the manner provided in section 106 of the Transfer of Property Act. If till the expiration of one month from the date of service of such notice, the tenant does not pay the rent, the landlord is entitled to institute a suit for recovery of possession. 80. However, the benefit bestowed on the tenant under the Rent Act is not limited to entitlement to a notice as referred to in sub-section (2) of section 12; the tenant is granted further protection under clause (b) of sub-section (3) of section 12, to the effect that if on the first day of hearing of the suit or on or before such other date as the court may fix, the tenant pays or tenders in the court the rent and thereafter continues to pay and tender in court such rent till the suit is finally decided and pays costs of the suit as directed by the court, no decree of eviction shall be passed in such suit. 81. Examining the facts of the present case in the light of the above statutory provisions, the applicant company filed Company Application No.16 of 1999 before this court seeking recovery of possession of the subject property as well as for arrears of rent etc. However, prior to filing the said application, the applicant had not issued any notice as contemplated under sub-section (2) of section 12 of the Rent Act and, therefore, he was not entitled to institute a suit for recovery of possession on the ground of default in payment of rent on the part of Jubilee Mills. The said application came to be rejected by the learned Company Judge. Against the order of the learned Company Judge, the applicant preferred O.J. Appeal No.1 of 2003, which came to be decided by a judgment and order dated 23.10.2008 passed by the Division Bench, whereby the court dismissed the appeal, but clarified that the secured creditors will provide necessary finance for payment of rent by the Official Liquidator to the lessors of the property in question, in case the Official Liquidator is not having the adequate funds for payment of such rent to the lessors. Despite the aforesaid order, the Official Liquidator did not make any payment of the arrears of rent to the applicant. After the Supreme remanded the matter to this court for deciding the same afresh, the applicant filed OJ (CA) No.358 of 2003, once again seeking possession of the subject property and arrears of rent, etc. Such application came to be filed on or about 5.8.2016. At this point of time also, the Official Liquidator had still not paid the arrears of rent in terms of the order dated 23.10.2008 passed by the Division Bench. Thereafter, the applicant issued a notice dated 02.09.2016 to the Official Liquidator of Jubilee Mills for payment of the arrears of rent, bringing to his attention the order dated 23.10.2008 passed in OJ Appeal No.1 of 2003. The applicant called upon the Official Liquidator to pay the arrears of rent payable since 1996 within a period of one month from receipt of the notice and also called upon him to pay the arrears of municipal taxes amounting to Rs.14.11 crores. After receipt of such notice, the Official Liquidator paid Rs.10,000/- on 10.01.2017 and Rs.500/- was paid on 04.04.2017. Thereafter, the Official Liquidator did not make any further payment till the matter came up for hearing when once again when during the course of hearing of the matters the issue regarding non- payment of rent for the subsequent period was raised, whereupon, on 17.03.2020, a statement was made that the amount of arrears has been paid. Thus, in this case no notice as contemplated under sub-section (2) of section 12 of the Rent Act, has been issued to the Official Liquidator of Jubilee Mills prior to filing the application. Under the circumstances, without satisfying the requirements of under sub-section (2) of section 12 of the Rent Act, the applicant is not entitled to seek eviction of the Official Liquidator by taking recourse to the said sub-section. 82. On behalf of the applicant, it is contended that the Official Liquidator does not need the subject property for the purpose of winding-up and hence, the property should be returned back to the applicant. On the other hand, on behalf of the respondents, it has been contended that the tenancy rights are an asset of the company in liquidation and, therefore, it is permissible for the Official Liquidator to transfer such leasehold rights. Strong reliance has been placed in this regard on the decision of the Supreme Court in case of Jabal C Lashkari v. Official Liquidator (supra). Therefore, it may be germane to refer to the said decision somewhat in detail. 82.1 In Jabal C Lashkari v. Official Liquidator (supra), while the return of the leased land was sought on the twin grounds that in view of the winding-up order, the Company no longer required the land and furthermore default in payment of rent had occurred, for the second relief sought, it was urged that the Official Liquidator is not authorised to transfer/alienate the lease property in view of the provisions of the Bombay Rent Act. The Court observed that the Division Bench of the High Court took note of the fact that the non- obstante clause in section 13 of the Rent Act gave the said section 13 an overriding effect over the other provisions of the Act. Section 13 was also made subject to the provisions of section 15 of the Bombay Rent Act. This is in contrast of section 21 of the Karnataka Act which has an overriding effect over any other law or contract to the contrary. Section 15 deals with the authority of the lessee to sub-lease or assign the leased rights /property, though, gives an overriding effect over any other law has been made subject to any contract to the contrary. Therefore, the terms of the lease and other cognate provisions of law is not obliterated. The Supreme Court observed that in view of the above provisions of the Bombay Rent Act, the Division Bench went on to hold that the ratio of the decision of the three Judge Bench of the Apex Court in Laxmidas Bapudas Darbar v. Rudravva (supra) would apply with much greater force for the benefit of the lessee under fixed long term lease in the State of Gujarat. It was further observed that it is on the aforesaid basis that the Division Bench came to the conclusion that the Rent Act did not obliterate the effect of the provisions of section 108 (j) of the Transfer of Property Act which would vest a right in the lessee not only to sublet but also to assign the subject matter of the lease granted to him by the original lessor. So far as the contention of the appellants that as company has been wound up, it no longer required the leased land for its use is concerned, the Supreme Court noted that the High Court in the impugned judgment, disagreed with the aforesaid proposition as a viable and acceptable proposition of law. Furthermore, it was held that the liability/obligation to pay rent for the lease land does not constitute an onerous obligation on the company in liquidation so as to justify surrender of the leased land by the Official Liquidator or any direction to the said effect under section 525 of the Companies Act. 82.2 On the question of liability of the Official Liquidator to a decree of eviction on the ground contemplated under section 13(1)(e) of the Rent Act, the Supreme Court held that the non- obstante clause of section 13(1) overrides only the other provisions of the Bombay Rent Act and is also subject to the provisions of section 15. Section 15 which deals with the subletting and transfer, though overrides the provisions contained in any other law, is subject to any contract to contrary. It was observed that though in that case, the lease deed, (clause 7) was capable of being read as permitting subletting and not assigning, but what has been held by the High Court by virtue of the decision of the Supreme Court in Laxmidas Bapudas Darbar v. Rudravva (supra) is that in view of the limited operation of the non obstante clause in section 15 of the Bombay Rent Act, unlike section 21 of the Karnataka Act, the provisions of the Transfer of Property Act [section 118(o)] will not become irrelevant to the relationship between the parties in which event assignment may also be permissible notwithstanding the specific content of clause 7 of the lease deed in question. 82.3 Insofar as the relief under section 13(1)(k) of the Bombay Rent Act is concerned, the Supreme Court observed that what is to be noticed is the requirement of unjustified non- user for a period exceeding 6 months which evidently was not attracted to the case before it in view of the pendency of the liquidation proceeding. The court further noted that, that apart from, clause (5) of the lease deed which deals with non-user of the leased land does not contemplate eviction on account of such non-user but merely entitles the lessor to receive rent for the period of such non-user of land. The court held that the mere fact that the company has been ordered to be wound-up cannot be a ground to direct the Official Liquidator to hand over the possession of the land to the owners, inasmuch as the company in liquidation continues to maintain its corporate existence until it stands dissolved upon completion of the liquidation proceeding in the manner contemplated by the Companies Act. It was further observed that in the case before it, it had been repeatedly submitted before the court by both the sides that presently revival of Prasad Mills is a live issue pending before the Gujarat High Court, which was a fact which could not be ignored by the court in deciding the above issue against the appellants before it. 83. Thus, insofar as invocation of section 13(1)(k) of the Rent Act is concerned, this case would be squarely covered by the above referred findings recorded by the Supreme Court in Jabal C. Lashkari (supra). 84. However, insofar as the right of the Official Liquidator to sublet and transfer the subject property is concerned, in the opinion of this court, the decision of the Supreme Court in Jabal C. Lashkari (supra), would not be applicable to the facts of the present case. In that case the Supreme Court was dealing with a case where there was a registered deed in favour of the company in liquidation, whereas in the facts of the present case, as discussed hereinabove, the lease deed of 1983 being an unregistered deed, none of the conditions contained therein can be read into evidence in favour of the lessee. Once the conditions of agreement of 1983 cannot be looked into, the question of considering the conditions of lease deed of 1911 does not arise, inasmuch as it is under the agreement of 1983 that the leasehold rights under the lease deed of 1911 have been transferred in favour of Jubilee Mills. Therefore, in effect and substance, in the facts of the present case, there is no contract to the contrary as envisaged in sub- section (1) of section 15 of the Rent Act. Consequently, in view of the provisions of sub-section (1) of section 15 of the Rent Act, it shall not be lawful for the Official Liquidator to sublet the whole or any part of the premises let to the company in liquidation or to assign or transfer in any manner his interest therein. The contention that it is permissible for the Official Liquidator to sublet the subject property on the basis of the clauses contained in the lease deed of 1911, therefore, does not merit acceptance. 85. On behalf of the Official Liquidator it has been contended that section 19 of the Rent Act makes an exception in the case of the proviso to section 15(1) thereof which permits sub- letting in case where the State Government, by notification in the Official Gazette, permits in any area the transfer of interest in premises held under such leases or class of leases and to such extent as may be specified in the notification. It was submitted that since the State Government has issued notification under section 15(1) of the Rent Act, it is lawful for the Official Liquidator to sell the leasehold rights. It may be noted that no such notification has been produced on record for the perusal of this court. However, such notification does find mention in the decision of this court in Neon Motor Stores & Ors. v. Alliance Stores Trading Co. Ltd., [1974] XV GLR 272, whereby transfer or assignment incidental to the sale of a business as a going concern together with the stock-in-trade and the goodwill thereof was permitted provided that the transfer or assignment is of the entire interest of the transferor or assignor in such leasehold premises together with the business and stock-in-trade and goodwill thereof. Thus, in terms of the said notification, the leasehold premises have to be sold as a going concern, whereas in the facts of the present case, the subject property is vacant land, therefore, the said notification issued under the proviso to sub-section (1) of section 15 of the Rent Act would have no applicability to the facts of the present case. 86. Thus, the applicant has not made out any case for eviction of the respondent - Jubilee Mills from the subject property on any of the grounds contained in sub-section (1) of section 13 or under sub-section (2) of section 12 of the Rent Act. At the same time, the Official Liquidator does not need the subject property for the purpose of winding-up, and for the reasons recorded hereinabove, is also not in a position to sublet or transfer the subject property in view of the bar contained in sub-section (1) of section 15 of the Rent Act. Not only that, section 19 of the Rent Act provides that save in cases provided for under the proviso to section 15, it shall not be lawful for the tenant or any person acting or purporting to act on behalf of the tenant to claim or receive any sum, or any consideration as a condition of the relinquishment, transfer or assignment of his tenancy of any premises. Therefore, transfer of the premises in question for a consideration is hit by sub-section (1) of section 19 of the Rent Act, which makes such transfer unlawful. Sub-section (2) of section 19 makes contravention of the provisions of sub-section (1), an offence punishable with imprisonment and fine as provided therein. Therefore, not only is subletting of the subject property, barred by sub-section (1) of section 15 of the Rent Act, such subletting is unlawful under sub-section (1) thereof of section 19 and is an offence punishable with imprisonment and fine under sub-section (2) thereof. Therefore, in any event, the Official Liquidator cannot sublet or transfer the tenancy rights in the subject property for a consideration as a condition of such transfer of the tenancy rights of Jubilee Mills in the subject property. 87. A situation has therefore been created wherein the subject property remains with the Official Liquidator as the applicant is not entitled to a decree of eviction on any of the grounds enumerated in sub-section (1) of section 13 or under sub-section (2) of section 12 of the Rent Act. However, the Official Liquidator neither needs the subject property for the winding-up, nor can he sublet or transfer the same, but at the same time, he is required to pay the rent for the said premises as well as the municipal taxes. As noticed earlier the outstanding tax dues payable to the Ahmedabad Municipal Corporation keeps on increasing and from an amount of approximately Rs.14 crores which was outstanding when OJ CA.358 of 2016 came to be filed, the outstanding amount has increased to more than Rs.20 crores. 88. At this juncture, reference may be made to certain precedents on which reliance has been placed by the learned counsel for the appellant. 88.1 In Uttra Achyut Chinubhai v. O.L. of Nanikram Shobhraj Mills (supra), the learned Company Judge directed the Official Liquidator after drawing proper inventory and panchnama to hand over the possession of the property to the applicant. 88.2 In Anil Private Ltd. v. O.L. of G.S.T.C. (supra) the learned Company Judge observed that it was apparent that there was no deed of lease and the company in liquidation had occupied the premises in question on a monthly tenancy basis. It shows that the tenancy was terminated every month subject to payment of rent. There was no dispute that the premises in question situated at Mumbai were not of any use so far as the Official Liquidator is concerned. The said premises were not required by the company for the purpose of business of the company or for the purpose of winding-up of the company in liquidation. The court placed reliance on the decision of the Supreme Court in Ravindra Ishwardas Shethna (supra). In the facts before the Supreme Court, the date of commencement of the lease was not available nor was it claimed on behalf of the liquidator that the lease was of long duration. It was also an agreed position that for the purpose of winding-up or for business of the company, the liquidator did not need the premises. In such circumstances, the High Court had permitted the liquidator to enter into a caretaker agreement by virtue of which a third party was put in possession of the premises. The Supreme Court held that the Company Judge could not have permitted holding on to possession of the premises, not needed for efficiently carrying on winding up proceedings and that the only course open to him was to direct the liquidator to surrender possession to landlords and save recurring liability to pay rent. Applying the aforesaid ratio to the facts of the case, the learned Company Judge directed the liquidator to hand over the vacant and peaceful possession of the premises in question. 88.3 In Dhairyasinh P. Rajda v. Ahmedabad Manufacturing & Calico Printing Co Ltd (supra)., the learned Company Judge directed the Official Liquidator to hand over the peaceful and vacant possession of the property in question after removing the seal to the applicant and co- owners, if any, within period of eight weeks from the date of receipt of that order. 88.4 In Ravindra Ishwardas Sethna (supra), the Supreme Court held that the Rent Act is no doubt enacted for protecting the tenants, and indisputably its provisions must receive such interpretation as to advance the protection and thwart the action of the landlord in rendering tenants destitute. But this does not imply that the court should lend its aid to flout the provisions of the Rent Act so as to earn money by unfair and impermissible use of the premises. And that is what the Liquidator sought to do and the court extended its help to the Liquidator. The court further held that the learned Company Judge could not have permitted holding on to possession of the premises, not needed for efficiently carrying on winding up proceedings. The only course open to him was to direct the Liquidator to surrender possession to landlords and save recurring liability to pay rent. 89. In the present case, learned advocate for the respondent has placed reliance upon the decisions cited hereinabove as well as on the provisions of section 535 of the Companies Act which provides for disclaimer of onerous property in case of a company which is being wound up. Sub-section (1) thereof provides that where any part of the property of a company which is being wound up consists of (a) land of any tenure, burdened with onerous covenants, the liquidator of the company notwithstanding that he has endeavoured to sell or has taken possession of the property, or exercised any act of ownership in relation thereto, or done anything in pursuance of the contract, may, with the leave of the Court and subject to the provisions of the section, by writing signed by him, at any time within twelve months after the commencement of the winding up or such extended period as may be allowed by the Court disclaim the property. It has been submitted that the Official Liquidator does not require the subject property for the purpose of winding up and that the same has become onerous as the Official Liquidator is required to continue paying rent as well as municipal taxes. 90. In the opinion of this court, payment of an annual rent of Rs.500/-, cannot by any means be termed to be an onerous covenant, at the same time, the fact that arrears of municipal taxes are mounting cannot be ignored. In light of the factual position as referred to hereinabove, it is evident that the Official Liquidator does not require the subject property for the purpose of winding up and in light of what is held hereinabove, is not empowered to sublet or transfer the subject property for consideration. Under the circumstances, except that the Official Liquidator is entitled to hold the subject property till the dissolution of the company, no useful purpose would be served if the Official Liquidator retains the possession of the subject property. 91. In the aforesaid premises, applying the decision of the Supreme Court in Ravindra Ishwardas Sethna (supra) to the facts of the present case, the only course open to this court is to direct the Official Liquidator to surrender the subject property to the landlord, namely, the applicant herein and save recurring liability to pay rent. 92. The learned counsel appearing on behalf of the Textile Labour Association had submitted that the Supreme Court in Jabal C. Lashkari (supra) has except in the case of Jabal Lashkari, remanded the rest of the OJ Appeals, with a clear direction that the High Court should examine the clauses of the lease deed in each of the matters. O.J. Appeal No.1 of 2003 was preferred against the order passed in Company Application No.16 of 1999, wherein a judgment was delivered by the Division Bench, which was challenged before the Supreme Court in the special leave petition. It was the lease deed dated 4th August, 1911, which was on the record of the Supreme Court. The Supreme Court has remanded the case with a direction to examine the clauses of the lease deed in line with the observations and principles of law laid down in O.J. Appeals No.64, 65 and 66 of 2006, and, therefore, the High Court has to confine itself within the scope and ambit of the judgment delivered in Jabal C. Lashkari (supra) and that any adjudication beyond that will not be permissible. 93. In the considered opinion of this court, the above argument fails to take into consideration the fact that the lease deed of 1911 is executed in favour of Ahmedabad Manufacturing Company, and does not vest any right in Jubilee Mills. Any right, title or interest in the subject property insofar as Jubilee Mills is concerned is based solely on the unregistered agreement of 1983. Therefore, if it is only the lease deed of 1911 which is required to be taken into consideration, Jubilee Mills would not be able to take any benefit thereunder. It appears that therefor, the learned counsel for the Official Liquidator has rightly not raised any such contention inasmuch as under the lease of 1911 the leasehold rights had been transferred in favour of Ahmedabad Manufacturing Company, which is not defunct and stands dissolved. 94. The learned counsel for the Textile Labour Association has further submitted that in any matter under the Companies Act, sections 529 and 529(A) thereof cannot be ignored by the court hearing company matters. It was pointed out that Jubilee Mills (in liquidation) was employing 3287 workmen and their total dues as ascertained by the Chartered Accountant are more than Rs.25 crores. The workmen have received only Rs.6 crores. The winding up order was passed in 1989. Even after thirty one years, the workmen have not received their dues and during this intervening period, more than 1100 workmen have passed away. It was submitted that the Official Liquidator should be empowered to transfer the leasehold rights for consideration and he should be allowed to comply with the provisions of sections 529 and 529(A) of the Companies Act for payment of the workers dues and dues of the secured creditors. 95. In the opinion of this court, the above contention would be squarely covered by the decision of the Supreme Court in Ravindra Ishwardas Sethna v. Official Liquidator (supra) wherein it was submitted on behalf of the respondent that the creditors and members of the Company in liquidation have suffered huge losses and if the Liquidator would have been permitted to enter into an agreement with the second respondent therein, it would fetch a steady income which would have gone towards mitigating the hardships of the creditors and members of the Company. The court, however, observed that neither had the accounts of the Company in liquidation been brought to its notice, nor could it permit violation of law howsoever laudable the object of such act may be. 96. The provisions of section 529 and 529A of the Companies Act, the workmen of the company become secured creditors by operation of law to the extent of workmen's dues as provided thereunder. The purpose of section 529A of the Companies Act is to ensure that the workmen should not be deprived of their legitimate claims in the event of liquidation of the company and the assets of the company would also remain charged for the payment of workers' dues and such charge will be pari passu with the charge of the secured creditors. Under section 529A of the Companies Act the dues of the workers and debts due to the secured creditors are to be treated as pari passu and have to be treated as prior to all other dues. Thus, section 529 and 529A provide for the assets of the company remaining charged for the payment of workers' dues, and give the workers' dues priority over all other dues. However, such charge is on the assets of the Company in liquidation. When it is not permissible for the Official Liquidator to sublet or assign the leasehold land, any direction issued by this court empowering the Official Liquidator to transfer the leasehold rights for consideration and comply with the provisions of section 529 of 529A of the Companies Act would be in violation of the provisions of sub-section (1) of section 15 and sub- section (1) of section 19 of the Rent Act, which is also an offence under punishable under sub-section (2) of section 19. Thus, while it is true that in any matter under the Companies Act, sections 529 and 529(A) thereof cannot be ignored by the court hearing company matters, it is equally true that the court cannot give any directions that are contrary to law. 97. In O.J. Civil Application No.358 of 2016, the applicant has also sought substitution of the Liquidator of Jubilee Mills in place of Ahmedabad Manufacturing Company. Since Ahmedabad Manufacturing Company had become defunct and stands dissolved, and it is the Liquidator of Jubilee Mills who seeks benefit of leasehold rights over the subject property under the lease deed executed in favour of Ahmedabad Manufacturing Company, and has been heard through the learned Counsel representing him in this case, granting of such relief is a mere formality. 98. To summarise: - While the duration of the lease deed dated 4th August, 1911 is indefinite, it is not permanent in nature. - The lease of 1911 cannot be said to be a periodic lease inasmuch as in case of a periodic lease the contract is determinable by notice to quit on the part of either lessor or lessee, whereas in the facts of the present case, the lessor has no right to issue a notice to quit except in the case of non-payment of rent. - The agreement of 1983 being an unregistered document, cannot be considered to be valid for a lease exceeding one year and has to be considered to be for a lease for a period less than one year as contemplated under second part of Section 107 of the Transfer of Property Act. The agreement of 1983 is, therefore, deemed to create a month-to-month tenancy, termination whereof is governed by section 106 of the Transfer of Property Act. - The unregistered agreement dated 26th April, 1983 is not a valid document and none of its clauses, including the clause whereby the leasehold rights of Calico Limited are transferred to it can be read in evidence. - Once the agreement of 1983 cannot be admitted in evidence, the lease deed of 1911 cannot be looked into as the rights under the lease deed of 1911 are claimed by the Official Liquidator under the agreement of 1983. Hence, neither can the agreement of 1983 nor the lease deed of 1911 be read in evidence. - Since the document of transfer of leasehold rights exceeding one year requires a document to be registered, the agreement of 1983 cannot be looked into for the purpose of establishing such right inasmuch as it cannot be said to be a collateral transaction. - In the absence of the tenancy being governed by the con- ditions of any contract, the tenancy is a statutory one and would be solely governed by the provisions of the Rent Act. - The controversy involved in the case of ICICI Limited v. Official Liquidator (supra) is confined to the parties to the said dispute and is not a judgment in rem. The rights decided in that case were between ICICI Limited claiming through Calico Limited and Jubilee Mills and hence, the said decision does not in any manner affect the rights of the applicant. - The doctrine of part performance under section 53A of the Transfer of Property Act would be applicable to the parties to the agreement and those claiming under them. In the present case, the applicant does not claim any right in the subject property through either the transferor or transferee, and hence, the provisions of section 53A would not be applicable. The Official Liquidator, there- fore, cannot press into service the right to protect pos- session against Calico Limited against the applicant herein. - Sub-section (1) section 13 of the Rent Act does not em- ploy the expression 'only' and therefore, does not limit eviction under the said Act to the grounds mentioned thereunder. Therefore, sub-section (1) of section 13 can- not be read to mean that eviction under the Rent Act can be only on the grounds stated down therein. While invoc- ation of section 13 of the Rent Act may be restricted to the grounds specifically provided thereunder, it would still be permissible for a landlord to seek eviction of the tenant under section 12 of the Rent Act, if the require- ments of sub-section (2) thereof are satisfied. - Calico Limited falls within the ambit of the expression "tenant" as defined in section 5(11) of the Rent Act. - Since under the agreement of 1941, Calico Limited was assigned the leasehold rights over the subject property under the lease deed of 1911, which contained a clause permitting transfer of the subject property, the transfer from Calico Limited to Jubilee Mills, is not violative of the provisions of sub-section (1) of section 15 of the Rent Act. - In the absence of any condition prescribing the purpose for which the premises are to be used or for eviction on the ground of non user, the provisions of clause (k) of section 13 (1) of the Rent Act cannot be invoked. - No ground for eviction has been made out by the applicant for recovery of possession under any of the grounds envisaged under section 13 of the Bombay Rent Act. - In this case no notice under sub-section (2) of section 12 of the Rent Act has been issued by the applicant to the Official Liquidator of Jubilee Mills prior to filing either of the two applications. Consequently, in the absence of the requirements of sub-section (2) of section 12 of the Rent Act being satisfied, the applicant is not entitled to seek eviction of the Official Liquidator by taking recourse to the said sub-section. - In the present case there is no contract to the contrary as envisaged under section (1) of section 15 of the Rent Act. Consequently, in view of the provisions of sub-section (1) of section 15 of the Rent Act, it shall not be lawful for the Official Liquidator to sublet the whole or any part of the premises let to the company in liquidation or to assign or transfer in any manner his interest therein; - In terms of the notification issued under the proviso to sub-section (1) of section 15 of the Rent Act, the leasehold premises can be sold as a going concern; whereas in the facts of the present case, the buildings and plant and machinery have been removed from the subject property which is now comprised of vacant lands, therefore, the said notification would have no applicability to the facts of the present case. - In the absence of a contract to the contrary, subletting of the subject property is barred by sub-section (1) of section 15 of the Rent Act; sub-letting of any premises in violation of section 15(1) of the Rent Act is unlawful under sub-section (1) of section 19 and is an offence punishable with imprisonment and fine under sub-section (2) thereof. Therefore, in any event, the Official Liquidator cannot sublet or transfer the tenancy rights in the subject property for a consideration as a condition of such transfer of the tenancy rights of Jubilee Mills in the subject property. - Since it is not permissible for the Official Liquidator to sublet or assign the leasehold land, any direction issued by this court empowering the Official Liquidator to trans- fer the leasehold rights for consideration and comply with the provisions of section 529 of 529A of the Companies Act would be in violation of the provisions of sub-section (1) of section 15 and sub-section (1) of section 19 of the Rent Act, which is also an offence under punishable un- der sub-section (2) of section 19. - Since the Official Liquidator neither needs the subject property for efficiently carrying on winding-up proceedings, nor is he in a position to sub-let or transfer the subject property for consideration, as held by the Supreme Court in Rajendra Ishwardas Sethna v. Official Liquidator (supra), the only course open to this court is to direct the Official Liquidator to surrender possession of the subject property to the applicant and save recurring liability to pay rent. 99. In the light of above discussion, the applications succeed and are accordingly allowed to the following extent. It is hereby ordered that the Official Liquidator of the Ahmedabad Jubilee Spinning and Manufacturing Company Limited be deleted and in place thereof, the name of the Official Liquidator of Ahmedabad Jubilee Mills Limited (in liquidation) be substituted. The Official Liquidator is directed to hand over peaceful and vacant possession of the lands bearing Survey No.53 admeasuring 4 acres 16 gunthas and Survey No.55 admeasuring 0 acres 16 gunthas of Village Dariapur-Kazipur of Town Planning Scheme No.14 bearing Final Plot No.41, District and Sub-District Ahmedabad to the applicant within a period of four months from the date of receipt of a copy of this judgment. Insofar as the payment of arrears of rent is concerned, such amount has already been paid during the pendency of these proceedings. Insofar as payment of monthly taxes, mesne profit, etc. is concerned, the applicant may claim the same in the winding up proceedings. 100. On behalf of the Official Liquidator as well as Textile Labour Association, a request has been made to stay the operation of this judgment for a period of ten weeks so as to enable them to approach the higher forum. Since this court has directed the Official Liquidator to hand over the possession of the subject land within a period of four months from the date of receipt of this judgment, the above request is taken care of. 101. In the light of the above order, OJ Civil Applications No.2, 3 and 4 of 2016 also stand disposed of.
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