LAWS(CAL)-1981-7-12

BRITANNIA ENGINEERING COMPANY LTD Vs. STATE

Decided On July 07, 1981
IN RE: BRITANNIA ENGINEERING COMPANY LTD. (IN LIQUIDATION) Appellant
V/S
STATE OF WEST BENGAL Respondents

JUDGEMENT

(1.) This is an application under Section 446 for leave to institute suit and legal proceeding against the official liquidator representing the Britannia Engineering Co. Ltd. in liquidation, in terms of prayer (a) of the judge's summons by M/s. Tinwald Properties, a registered partnership firm and the landlord of Trivoli Court, in respect of flat No. 107 on the 2nd floor of Block 'A', Trivoli Court at No. 1/C, Bullygunge Circular Road.

(2.) The facts which cannot be disputed are that on or about 31st May, 1969, Britannia Engineering Co. Ltd. was inducted as a monthly tenant in respect of the said flat No. 107 on the second floor of Block A, Trivoli Court, at No. 1/C, Bullygunge Circular Road, at a monthly rent of Rs. 950, service charge Rs. 250 per month and hire charge for fittings at Rs. 150 per month, making an aggregate of Rs. 1,350 per month. The said Britannia Engineering Co. Ltd. also advanced a sum of Rs. 30,000 which was to be adjusted against the monthly rent at the rate of Rs. 500 per month and the company paid rent in terms of the said tenancy agreement up to certain period and, thereafter, it failed and neglected to pay rent in respect of the same. It is alleged in the affidavit being the ground of the present application, affirmed by one Pradip Mehta on 23rd December, 1980, that the company defaulted in making payment of rent and hire charges in terms of the said monthly tenancy agreement since December, 1970, and, thereafter, no payment has been made by the company in respect of the rent and service charges and, as such, the applicant by letter dated 21st October, 1976, addressed to the Authorised Controller of the parent division of the company which was taken over by the Central Govt. under I (D & R) Act, 1951, which replied, as per the reply produced before the court during the hearing by Mr. S.B. Mukherjee, appearing for the applicant, that they were not interested in the said flat as the same was not taken over under the said Act and it did not form part of the industrial undertaking taken over by the Central Govt. of which the Authorised Controller was in possession. It also appears from the correspondence placed before me that one Mr. S.C. Bhalla was allotted the said flat as an employee of the said Britannia Engineering Co. Ltd. by the company while the said company was not wound up or the parent division was not taken over under the I (D & R) Act, 1951. It is quite clear from the correspondence as disclosed by the applicant in its affidavits, being the ground of the present application, and the affidavit-in-reply and also the supplementary affidavit, that the said Mr. Bhalla was occupying the said premises as an employee of the Britannia Engineering Co. Ltd. before it was wound up. It further appears that he is in possession of the said flat of which he is now claiming to be the tenant under the applicant in the name of his firm, M/s. Maxwell Engineering Co. It also appears that he has made certain payments to the applicant and also started depositing alleged rent with the Rent Controller, as would appear from the supplementary affidavit filed by the said S.C. Bhalla affirmed on 9th June, 1981. After this present application was moved, it appeared to me that the said Mr. Bhalla, who was not made a party, should be served with a notice of this application as the order to be made in this application will directly affect him because he is in possession and also claiming to be a tenant under the applicant, and pursuant to the said direction, notice was served on Mr. Bhalla, who appeared before me through Mr. P.K. Das initially and subsequently, Mr. R. Chodhury appeared leading Mr. Das and made submissions. In the affidavit filed by Mr. S.C. Bhalla, affirmed on 2nd April, 1981, in this application, in opposition to the applicant's present application, alleged that the Britannia Engineering Co. Ltd. declared a lock-out on 2nd October, 1970, and discontinued to pay any rent to the applicant and it is alleged by Mr. Bhalla that he entered into a tenancy agreement with the applicant as the sole proprietor of his concern known as Maxwell Engineering. Co. and it is alleged by Mr. Bhalla in the said affidavit that the applicant started accepting rent pursuant to their letter dated 5th April, 1972, and issued rent receipts to Mr. S.C. Bhalla, who is admittedly in possession of the said flat No. 107 in Trivoli Court, Block A. It is also alleged that the applicant refused to accept rent and, thereafter, Mr. Bhalla started depositing rent with the Rent Controller from April, 1977, and he has been depositing the rent up to February, 1981. Bhalla alleged that he became a direct tenant under the applicant in 1972 when Britannia Engineering Co. Ltd. went into liquidation in 1974. Therefore, the alleged tenancy of Mr. Bhalla under the applicant cannot be linked up with the company in liquidation, being Britannia Engineering Co, Ltd. It was also argued by Mr. Das that there was an implied surrender by the company and a fresh tenancy in favour of Mr. Bhalla in 1972. In the said affidavit, he has annexed two rent receipts dated 5th January, 1973, and 9th August, 1973, for Rs. 950 each and also a letter dated 5th April, 1972, which is set out here I <FRM>JUDGEMENT_277_CC54_1983Html1.htm</FRM>

(3.) From the said affidavit and the said pleading, it appeared to me that Mr. Bhalla was alleging surrender of the tenancy by the company in liquidation and also fresh tenancy being created in his favour by the applicant and, therefore, I directed supplementary affidavits to be filed by the applicant and also reply, by Bhalla. Mr. Bhalla filed a supplementary affidavit on 9th June, 1981, and the applicant dealt with the said supplementary affidavit filed by Pradip Mehta affirmed on 15th June, 1981. From all these affidavits, it appears that Mr. Bhalla alleged that the company by its letter dated 24th November, 1970, because of the closure of their works with effect from 2nd October, 1970, terminated the service of the said S. C. Bhalla with effect from 30th November, 1970. Mr. Bhalla disputed the said termination and contended that he is still in the employment of the company now in liquidation; and as a part of the terms of his employment he is in occupation of the said flat. Therefore, the court has no power to direct him to quit and vacate the said flat. The said contention is not only fantastic both in law and in fact but absurd to be accepted in any way whatsoever. Admittedly, Britannia Engineering Co. Ltd. was wound up in the application, being C.P. No. 452 of 1971, presented by Bengal Ingot Co. Ltd., by an order dated October 4, 1972. Subsequently, various units of the company in liquidation being Britannia Engineering Co. Ltd. were taken over being Mokama unit and the parent division at Titagarh by the Central Govt. under the I (D & R) Act, 1951, as different units of industrial undertakings, and the rest of the company's assets were administered by the liquidator in winding up of the company and subsequently, these were sold by public auction in court. From the present application of the applicant for leave under Section 446, it transpired to the official liquidator for the first time that the company had a monthly tenancy in the said flat at Trivoil Court being flat No. 107 in Block A under the applicant. It is also stated by the official liquidator in the affidavit filed by one Ananda Mohan Ganguly, affirmed on 21st January, 1981, in this application, that the said winding-up order dated 4th October, 1972, was appealed from and stayed and again by an order dated 10th January, 1973, the company was wound up and the official liquidator became the liquidator.