CHANDAN MULJI NISHAR Vs. UNION OF INDIA

JUDGEMENT

(1.) Legal representatives of original plaintiff have preferred this appeal against dismissal of the suit no.214 of 1978 by the learned Single Judge. Defendant Nos.1 to 12 are the respondent nos.1 to 12 respectively in this appeal. For the sake of convenience, the parties shall be referred to as plaintiffs or defendants.

(2.) To state in brief, the defendant no.2 is a private Ltd. company and because of non payment of income-tax to the tune of Rs.12,54,144/- from the year 1963-64 onwards, for the recovery of the tax, the tax recovery officer issued a proclamation on 1st June, 1974, which was published in Government Gazette on 20th June, 1974 for sale of the property of the defendant no.2. The property included the business alongwith the tenancy rights of the defendants over the disputed premises situated at 2nd floor of the United India Building, Sir Phirozshah Mehta Road, Fort, Bombay. The original plaintiff had participated in the auction and his bid for Rs. 1,05,000/-, being the highest, was accepted. At the time of auction, he paid 25% of the auction money and later on, he deposited 75% of the amount. Nobody had taken any objection nor had applied for setting aside the same within 30 days from the date of auction. The defendant no.1, through income-tax officer, issued sale certificate in favour of the original plaintiff on 27th August, 1974. The suit premise is actual property of Life Insurance Corporation of India and the defendant no.2 was a tenant over the same. As per the auction, the tenancy rights of the defendant no.2 over the said premises alongwith his business were put to sale and they were purchased by the plaintiff. The Plaintiff requested the income-tax authorities to put him in possession of the suit premises alongwith its business including movable articles. However, the income-tax authorities failed to put him in possession. Therefore, the plaintiff filed the suit for possession of the business with moveable articles, goodwill and the tenancy rights of the defendant no.2 over the suit premises.

(3.) The defendant no.1 being the Union of India did not file any written statement but made a submission in writing and also participated in the trial of the suit. Defendant Nos.2 and 3 contested the suit. According to them, the defendant no.2 being a tenant was entitled to sub-let the premises and accordingly, in the year 1967 or so, the defendant no.2 had put a charitable trust in possession of the same as tenant. The defendant no. 3 was in turn put in possession of the same. The Estate Officer of the Life Insurance Corporation had also commenced eviction proceedings against the defendant nos.2 and 3 but after enquiry it was held that the defendant no.3 was in lawful possession. It is further contended that under the relevant Rent Act, the defendant no.3 is in lawful possession of the premises since prior to 1973 and is protected under the Rent Act. Therefore, he can not be dispossessed from the same without following the procedure of law. It was further contended that as per the Rent Act, the tenancy rights could not have been put to sale and, therefore, the alleged auction and sale of the tenancy rights of the defendant no.2 is illegal and void.