Research › Search › Judgment

Bombay High Court · body

2008 DIGILAW 1768 (BOM)

Bagalkot Udyog Limited v. Air India Limited

2008-12-17

BILAL NAZKI, S.S.SHINDE

body2008
Judgment :- Bilal Nazki, J. The petitioners claim that they were tenants of a premises measuring 6426.65 sq.ft. situated on the 14th Floor of Air India Building, Nariman Point, Mumbai. The Estate Officer passed an order under Section 5(1) of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971, by which he ordered the petitioners to vacate the premises within 15 days therefrom. This order was challenged by way of an appeal before the City Civil Court at Bombay being Miscellaneous Appeal No. 264 of 2001, which has been decided by the Appellate Authority on 27th December, 2007. The present writ petition challenges the order passed in Miscellaneous Appeal as well as the order passed by the Estate Officer. 2. Mainly three grounds were agitated before this Court. One of the ground was that since the petitioner No.1 company was declared as sick unit in terms of Section 22 of the Sick Industrial Companies Act, 1985 (for short “SICA”), the eviction proceedings were without jurisdiction. Second ground agitated was that the guidelines issued by the Central Government with respect to the occupation of the public premises were violated and therefore the order of eviction was bad. Thirdly, the petitioners have also claimed that by virtue of coming into effect of Maharashtra Rent Control Act, 1999, the petitioners were entitled to protection under the Maharashtra Rent Control Act. 3. Coming to the first argument, it is contended by the learned Counsel for the respondents that this question stands concluded by the judgment of the Supreme Court. In order to appreciate the rival arguments, it is necessary to look into subsection (1) of Section 22 of the SICA. Subsection (1) of Section 22 of the SICA lays down as follows: 22. In order to appreciate the rival arguments, it is necessary to look into subsection (1) of Section 22 of the SICA. Subsection (1) of Section 22 of the SICA lays down as follows: 22. Suspension of legal proceedings, contracts, etc., (1) Where in respect of an industrial company, an inquiry under section 16 is pending or any scheme referred to under section 17 is under preparation or consideration or a sanctioned scheme is under implementation of where an appeal under section 25 relating to an industrial company is pending, then, notwithstanding anything contained in the Companies Act, 1956 (1 of 1956) or any other law or the memorandum and articles of association of the industrial company or any other instrument having effect under the said Act or other law, no proceedings for the windingup of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof shall lie or be proceeded with further, except with the consent of the Board or, as the case may be, the Appellate Authority.” Bare reading of this section would reveal that if the conditions specified in this section are met then no proceedings for winding up of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof shall lie except with the consent of the Board or as the case may be with the consent of the Appellate Authority. The proceedings for eviction from a premises which at best can be, in the present case, a rented premises do not fall under subsection (1) of Section 22 of the SICA although the respondents have claimed that the petitioners were tenants of the respondents. The proceedings for eviction from a premises which at best can be, in the present case, a rented premises do not fall under subsection (1) of Section 22 of the SICA although the respondents have claimed that the petitioners were tenants of the respondents. The Supreme Court in the case of M/s. Shree Chamundi Mopeds Ltd. V/s Church of South India Trust Association, CSI Cinod Secretariat, Madras, reported in JT 1992 (3) SC 98, while disposing of a matter framed a specific question under paragraph 6 in the following terms: "Are the proceedings instituted by a landlord for eviction of a tenant who is a sick company from the premises let out to it, required to be suspended under Section 22(1) of the Act?” The Supreme Court analysing subsection (1) of Section 22 of the SICA, found that eviction proceedings initiated by a landlord against a tenant company would not fall in any of the categories mentioned in Section 22 (1) of the SICA and ultimately held, “We are, therefore, of the view that Section 22(1) does not cover a proceeding instituted by a landlord of a sick industrial company for the eviction of the company premises let out to it.” Similarly, in the case of Carona Limited v/s Parvathy Swaminathan & Sons, reported in (2007) 8 SCC 559 , the Supreme Court also relied on the judgment in the case of Shree Chamundi Mopeds Ltd. (supra) to come to a conclusion that the eviction proceedings initiated by the landlord against the tenants were maintainable even if the company was sick under the SICA and Section 22 of the SICA had no application. Therefore, on this ground the writ petition cannot be allowed and the contentions of the petitioners have to be rejected. 4. The second ground relating to a benefit under the guidelines, it is submitted by the learned Counsel for the respondents that the guidelines laid are advisory in character and cannot be enforced by the Court and these guidelines in any case are not applicable to business houses or commercial entrepreneurs. Learned Counsel for the respondents in this connection relied on a judgment of the Supreme Court in the case of J. R. Raghupathy & Ors. Learned Counsel for the respondents in this connection relied on a judgment of the Supreme Court in the case of J. R. Raghupathy & Ors. V/s State of A. P. and Others, reported in (1988) 4 SCC 364 , in which it was held by the Supreme Court that purely administrative instructions cannot be enforced by writ. Learned Counsel for the respondents also relied on the judgment in the case of Narendra Kumar Maheshwari v/s Union of India and Others, reported in 1990 (Supp) SCC 440, for the same proposition. Learned Counsel for the Respondents also relied on a latest unreported judgment of the Supreme Court in the case of New India Assurance Company Limited v/s. Nusli Neville Wadia and another decided on 13th December, 2007, in which other Judgments were also taken note of. This was a Civil Appeal arising out of the Special Leave Petition (Civil) No. 8232 of 2006. Some guidelines were pressed into service in this case, which are being pressed into service now. One of the guidelines dated 23rd July, 2003 had the following caveat: "3. The Government Resolution dated 30.05.2002 embodies the guidelines dated 14.01.1992 for observance by the Public Sector Undertakings. However, clarification was issued vide OM No.21011/790. Pol.1 IV.H.11 dated 07.07.1993 that the guidelines are meant for genuine non affluent tenants and these are not applicable to the large business houses and commercial entrepreneurs.” While taking note of this condition, the Supreme Court held that issuance of guidelines would not be controlled by statutory provisions. The effect thereof is advisory in character and thereby no legal right is conferred upon the tenant which could be enforced. Therefore, the matter stands concluded that the guidelines on which the petitioners relied could not be enforced by the Court. 5. Coming to the third argument that the Maharashtra Rent Control Act, 1999 would apply, it is contended that this issue also stands decided by the Supreme Court. Therefore, the matter stands concluded that the guidelines on which the petitioners relied could not be enforced by the Court. 5. Coming to the third argument that the Maharashtra Rent Control Act, 1999 would apply, it is contended that this issue also stands decided by the Supreme Court. The Supreme Court in the same judgment held, “A tenant of a public premises although ordinarily does not get any protection from eviction from the tenanted premises under the provisions of the Maharashtra Rent Control Act, 1999, it is accepted that the action on the part of the landlord, which is a State within the meaning of Article 12 of the Constitution of India must in this behalf be fair and reasonable.” In the case in hand, we have not seen anything which would show that the respondents in the matter were unfair. They proceeded under the provisions of the Act, gave show cause notice and an order was passed. The appeal was heard and decided. It remained before the Appellate Authority almost for five years. In this connection, it may be stated that it was stated that the matter was heard by the Appellate Authority and when on 27th December, 2007 it was called out for hearing the petitioner's advocate brought to the notice of the Appellate Authority a copy of the BIFR order dated 12th October, 2007 which had sanctioned rehabilitation scheme for revival of the company. The advocate before the Appellate Authority wanted to make oral submission thereon. The Appellate Authority, however, refused to take BIFR order dated 12th October, 2007 on record and also refused permission to make submission to the effect of the order of BIFR and proceeded to pronounce the judgment. Even if, what has been stated is true, we do not think that it has prejudiced the petitioners in any way because in any case the BIFR order could not have taken away the jurisdiction of the Appellate Authority to decide the appeal under the provisions of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971. 6. For these reasons, we do not find any merit in this writ petition,which is accordingly dismissed.