Janki Devi v. Official Liquidator Maharaja Kishangarh Mills Ltd.
2015-03-20
ALOK SHARMA
body2015
DigiLaw.ai
JUDGMENT 1. - These seven civil misc. applications have been filed under section 446(2)(b) of the Companies Act, 1956 (hereinafter the Act of 1956') against the order dated 21.4.2014 passed by the Addl. District Judge, Kishangarh, District Ajmer (hereinafter the Executing Court') in Execution Case Nos. 7/1997 (misc. application No.02/2012 and 118/2011), (misc. application No.99/2011 and 120/2011), (misc. application No.02/2012 and 118/2011), (misc. application No.107/2011 and 117/2011), (misc. application No.109/2011 and 111/2011) (misc. application No.108/2011) and (misc. application No.116/2011). Thereby the Executing Court dismissed the multiple objections filed by the different objectors/resistors applicants (hereinafter the objectors/resistors') in the execution proceeding (7/1997) taken by the landlord decree-holder Maharaja Kishangarh Mills Ltd. (hereinafter 'the company in liquidation') through Official Liquidator in respect of the final Judgment & Decree dated 5.2.1987 whereby the Company Court in company application No. 21/1980 under sections 446 and 477 of the Act of 1956 directed eviction of the tenant, one M/s. Mahesh Metal Works, Kishangarh District Ajmer from the premises let-out by the Official Liquidator of the Company in liquidation (hereinafter 'the Official Liquidator') on 7.4.1960. 2. The facts of the case are that the Standard General Assurance Company Limited filed a winding petition No. 3/1956 under section 433 of the Act of 1956 on 7.10.1956 against the company Maharaja Mills Ltd. which was allowed on 7.10.1956. The Deputy Registrar of this Court was appointed as the Liquidator of the Company directed to be wound up. He then in his wisdom rented out a leased property of the company in liquidation i.e Patni Bhawan to M/s. Mahesh Metal Works (hereinafter the tenant') under his letter/agreement to lease dated 17.4.1960. As the premises rented out were not for a fixed period, in law the tenancy was month to month terminable by 15 days notice expiring with the month of the end of the tenancy. Clause 2 of the letter/agreement to lease dated 7.4.1960 allowed the tenant to "sub-let the premises on your risk" evidencing the fact that the tenant could not create rights larger than its own by way of sub-tenancy. 3. The Official Liquidator as landlord thereafter in 1977 filed an eviction petition on the grounds of default, sub-letting and also for the tenanted premises, then in dilapidated condition for lack of upkeep being required for over-all repairs.
3. The Official Liquidator as landlord thereafter in 1977 filed an eviction petition on the grounds of default, sub-letting and also for the tenanted premises, then in dilapidated condition for lack of upkeep being required for over-all repairs. The tenant filed reply to the eviction petition but did not lead any evidence on the issues framed on the basis of the pleadings of the parties. In the circumstances, following the evidence led by the Official Liquidator and his witnesses on behalf of the company in liquidation, vide order dated 7.11.1986 the evidence of the tenant was closed. Subsequently vide judgment dated 5.2.1987 the eviction petition laid by the Official Liquidator was allowed by the Company Court on the ground of default and the tenant directed to be evicted. 4. The Official Liquidator filed an execution application No. 7/1997 under Order 21 Rule 35 CPC against the judgment-debtor M/s. Mahesh Metal Works through its Partner Shri Inder Dutt Bhargava on 10.11.1997 before the Executing Court. On 19.9.2011 the Assistant Nazir of the Executing Court visited the tenanted premises i.e Patni Bhawan and appurtenant land which was the subject matter of the judgment for eviction dated 5.2.1987 passed by the Company Court to get it vacated. It was found that the property in issue was occupied by several persons claiming to be sub-tenants of M/s. Mahesh Metal Works in terms of Clause 2 of the letter/agreement to lease dated 7.4.1960. The Official Liquidator sought police help from the Executing Court to take possession. The occupiers of the tenanted property threatened with dispossession under the Company Court's Judgment dated 5.2.1987, resorted to objection applications under section 47 r/w Order 21 Rule 97 and section 151 CPC to the Official Liquidator's execution application. Reply to the objections was filed challenging their maintainability. The Executing Court after hearing the parties, by the impugned order dated 21.4.2014 dismissed the objections to the execution of the Judgment and Decree dated 5.2.1987 passed by the Company Court finding that the objectors had not made out any "just cause" to obstruct/resist the execution of the decree and giving of possession of the tenanted premises to the decree-holder Official Liquidator who as landlord had in the first instance let-out "Patni Bhawan" and appurtenant land to M/s. Mahesh Metal Works. 5. Mr.
5. Mr. V.L Mathur appearing for the applicant submitted that the impugned order dated 21.4.2014 is vitiated for reason of the Executing Court having decided by a common order, multiple objections filed by different objectors/resistors against the final Judgment and Decree dated 5.2.1987 passed by the Company Court. Further, that the Court of Addl. District Judge did not have pecuniary jurisdiction to execute the judgment and decree dated 5.2.1987 passed by the Company Court. Counsel also submitted that the objectors/resistors had a legal right independent of the Judgment-debtor M/s. Mahesh Metal Works (hereinafter also "main-tenant") having been inducted as sub-tenants to various portions of Patni Bhawan in terms of Clause 2 of the letter/agreement to lease dated 7.4.1960 by the "main tenant". As lawful sub-tenants within the meaning of section 13(i)(e) read with section 13(2) of the Rajasthan Premises (Control of Rent & Eviction) Act, 1950 (hereinafter the Act of 1950') the objectors/resistors were not bound by any decree obtained by the Official Liquidator without impleading them, such decree was not executable as against them. Counsel submitted that even though application bearing No. 21/1980 (eviction petition) filed by the Official Liquidator under sections 446 & 447 of the Act of 1956 before the Company Judge had been laid interalia on the ground of sub-letting, the Judgment and Decree dated 5.2.1987 obtained only on ground of default. This aspect of the matter and its consequences, counsel for the objectors/resistors submitted, has not been at all considered by the Executing Court in its order dated 21.4.2014 and hence vitiates it. Reference has been made to the Judgment of Hon'ble Apex Court in S.S.S Narayana Sarma v. M/s. Goldstone Exports (P) Ltd. AIR 2002 SC 251 to submit that the Executing Court was in the circumstances of the case obliged to address the objectors'/resistors' case as to their independent right in the tenanted premises as sub-tenants with reference to Clause 2 of the letter/agreement to lease dated 7.4.1960. Counsel submitted that even otherwise the judgment and decree dated 5.2.1987 was nonest in the eye of law having been passed against the main tenant M/s. Mahesh Metal Works impleaded through its partner Inder Dutt Bhargava who had in the meantime expired subsequent to filing the written statement/reply to the eviction petition and his LRs not brought on record.
Counsel submitted that even otherwise the judgment and decree dated 5.2.1987 was nonest in the eye of law having been passed against the main tenant M/s. Mahesh Metal Works impleaded through its partner Inder Dutt Bhargava who had in the meantime expired subsequent to filing the written statement/reply to the eviction petition and his LRs not brought on record. Counsel for the objectors/resistors empathetically submitted that the provisions of Order 21 Rule 103 CPC were not adhered to, as all questions raised, were not decided consequent to which the impugned order dated 21.4.2014 passed by the Executing Court was vitiated and liable to be set aside. Finally it was submitted that in any event, in company application bearing No. 7/1972 filed by Maharaja Kishangarh Somyog Mills Co. Ltd. (old company) against the Official Liquidator of the Maharaja Kishangarh Mills Ltd. (in liquidation), the Company Court by its judgment dated 15.10.1982 had held that "Patni Bhawan" including its appurtenant land (i.e. the tenanted property) was not in the ownership of the company in liquidation but of Maharaja Kishangarh Somyog Mills Co. Ltd. It was submitted that in the circumstances the Official Liquidator could not have approached the Company Court under his application No.21/1980 seeking eviction of M/s. Mahesh Metal Works nor the Company Court, acting in excess of its jurisdiction, could have directed at his instance by its judgment and decree dated 5.2.1987 that the company in liquidation was entitled to put in possession of the said Patni Bhawan and appurtenant land. 6. Mr. Gaurav Sharma, appearing for the Official Liquidator has submitted that the entire proceedings taken by the objectors/resistors in their application under Order 21 Rule 97 CPC before the Executing Court were without any foundation, wholly frivolous and completely vexatious. It is submitted that albeit Order 21 Rule 97/101, 102 and 103 read with section 47 CPC has been broadly construed by the Courts to require the Executing Court to address all objections to the execution of a decree, yet unless a "just cause" is made out by the objectors/resistors, no indulgence is to be granted lest execution proceedings are unnecessarily prolonged and execution of a final decree obtained in accordance with law vindicating the rights of a decree-holder delayed without justifiable cause.
He submitted that the Executing Court is to be alert to mischievous litigants who unfairly resort to the judicial processes without any foundation as to their legal rights and only seek to obstruct judicial processes and transform them into an instrument of oppression with a clear intent to subvert justice. It was submitted that until a prima facie right was made out by the objectors/resistors, execution of a decree cannot be stalled. It was submitted that the objectors/resistors failed to produce any writing of probative worth in support of their contention of being lawfully inducted as sub-tenants by M/s. Mahesh Metal Works-the "main tenant" in the exercise its purported authority under Clause 2 of the letter/agreement to lease dated 7.4.1960. Further no receipts of rent allegedly paid by the objectors/resistors to the "main tenant" were produced before the Executing Court. It was submitted that in the circumstances the objectors/resistors did not have any status other than that of rank-trespassers in the the property in issue let out to the "main tenant" in respect of which a judgment and decree of eviction was passed by the Company Court. It was also pointed out that Clause 2 of the letter/agreement to lease dated 7.4.1960 even otherwise impliedly entailed the "main tenant" informing the lessor-landlord with regard to induction of subtenants. No letter on this count was addressed to the company in liquidation at any point of time by the "main tenant". It was further submitted that the letter/agreement to lease dated 7.4.1960 not being for a fixed period, it was, perforce in terms of obtaining law, capable of being construed only as a tenancy month to month and the power to sub-let under clause 2 of the letter/agreement to lease dated 7.4.1960 could not confer on any purported sub-tenant a tenancy for a time larger than that inhering in the "main tenant" i.e month to month. No lawful contract of sub-tenancy was made out in the facts of the case. 7. Mr. Gaurav Sharma then submitted in the alternative that the Judgment and Decree dated 5.2.1987 passed by the Company Court would not be inexecutable even against the purported sub-tenants (which sub-tenancy is empathetically denied) as it is well settled that an eviction petition against a tenant is maintainable without the impleadment of subtenants and a decree in respect thereof executable against them.
With regard to the jurisdiction of the Company Court in company application No. 20/1981 filed by the Official Liquidator remaining, subsequent to the order dated 15.10.1982 passed in execution petition No. 7/1972 directing eviction of the "main tenant" M/s. Mahesh Metal Works, it was submitted that no such case was pleaded in the objections before the Executing Court, nor evidence thereon led, nor the point argued. Counsel submitted that, in any event, the aforesaid fact has no bearing on the controversy at hand, in as much as, one way or the other, the property in dispute was admittedly let out by the Official Liquidator to M/s. Mahesh Metal Works vide letter/agreement to lease dated 7.4.1960 and consequently the Official Liquidator was the landlord within the meaning of section 3(iii) of the Act of 1950. It was submitted that the application No. 21/1980 under sections 446 and 477 of the Act of 1956 at the instance of the Official Liquidator was therefore very well maintainable before the Company Court and nothing erroneous or wanting in jurisdiction can be attributed to the judgment and decree dated 5.2.1987 passed by the Company Court. Such a decree was hence executable in accordance with law as has been ordered to be in the impugned Judgment dated 21.4.2014 passed by the Executing Court. Counsel finally submitted that the Executing Court no doubt had subject matter jurisdiction and prejudice not having been pleaded, the ground of the Executing Court allegedly having no pecuniary jurisdiction deserves to be rejected on the face of it. Heard and perused the impugned order dated 21.4.2014 passed by the Executing Court. 8. It is no doubt true that the Order 21 CPC enables third parties to seek adjudication of their rights to property in respect of which a decree-holder seeks to enforce his rights against a Judgment-debtor. Order 21 Rule 35 CPC provides that where a decree is for the delivery of any immovable property and the person in possession apparently bound by the decree does not allow free access, the Court may through its Officers require removal, opening of any lock and even breaking of any door or otherwise to do any act necessary for putting the decree-holder in possession.
Under Order 21 Rule 97 CPC where a third party in possession of immovable property covered under a Court's decree seeks to agitate its right to possession of the suit property, he may make an application to the Court rejecting/resisting the execution of the decree. Thereupon the Court is to proceed to adjudicate the application in accordance with the other provisions of Order 21 CPC. Rule 101ORDER21 CPC provides that all questions (including question relating to right, title or interest in the property) arising between the parties to a proceeding on an application under Rule 97 or 99 CPC shall be determined by the Executing Court itself and not by other Court. Rule 98ORDER21 CPC provides that upon the determination of the questions referred to in Rule 101 CPC, the Court shall make an order, where warranted, allowing the application and directing that the applicant be put in possession of the property or otherwise not so directing for reasons stated. However, where the Executing Court is satisfied that the resistance/obstruction is occasioned without any just cause by any person, it may even order for the imprisonment of a recalcitrant objector/resistor while directing delivery of possession of the immovable property in issue to the decree-holder. 9. In the context of the aforesaid fasciculus of the provisions under Order 21 CPC, it is apparent that no obstruction to a final Judgment & Decree passed by a Court can be created by any person without a "just cause". The starting point of a "just cause" to my mind would be where an objector/resistor prima-facie establishes even a modicum of a legal right to continue in possession of the immovable property in dispute either claiming through the Judgment-debtor or asserting an independent right to the property. Reverting to the facts of the pleas of resistors/objectors in the case at hand, it is apparent that the objectors set up their right to possession of the tenanted premises, directed to be otherwise vacated under the Judgment & Decree dated 5.2.1987 on the basis of their purported induction as sub-tenants by the "main-tenant" M/s. Mahesh Metal Works under the letter/agreement to lease dated 7.4.1960. However for this purpose the objectors/resistors were not able to establish from a even shred of documentary evidence their induction as subtenants by M/s. Mahesh Metal Works. No writing in this regard evidencing the induction as sub-tenant was produced before the Executing Court.
However for this purpose the objectors/resistors were not able to establish from a even shred of documentary evidence their induction as subtenants by M/s. Mahesh Metal Works. No writing in this regard evidencing the induction as sub-tenant was produced before the Executing Court. In S.B. Company Application No. 25/2014, Laxmi Narain Gupta v.Official Liquidator & Anr., reliance has been placed on Annex.2-a purported writing by one Ashok Kumar Sharma recording his alleged status as a licencee of the lessee M/s Mahesh Metal Works. The said writing is only a typed copy, undated and unsigned. The licencee therein states to have drawn it himself and it is on the face of it not drawn or signed by the lessee M/s Mahesh Metal Works. What the applicant Laxmi Narain Gupta seeks to contend from Annex.2 is incomprehensible. What is apparent, however, is a reckless, desperate attempt to throw at the Court whatever comes to hand. In the circumstances nothing can be made out from Annex.2 in S.B Company Application No. 25/2014. 10. No rent receipt evidencing payment of any rent by any of the objectors/resistors as sub-tenants to M/s. Mahesh Metal Works the "main tenant" was filed, exhibited or relied upon before the Executing Court. No letter from M/s. Mahesh Metal Works to the landlord i.e the Official Liquidator of Maharaja Kishangarh Mills Ltd. evidencing the induction of sub-tenants in terms of Clause 2 of the letter/agreement to lease dated 7.4.1960 was also adverted to or otherwise brought on record. No evidence was filed to show as to which portion of the property "Patni Bhawan" and its appurtenant lands were in fact let-out by the Official Liquidator of the company in liquidation to M/s. Mahesh Metal Works. A bare look at the letter/agreement to lease dated 7.4.1960 shows that all of "Patni Bhawan" and its land were not delivered in tenancy on 7.4.1960. Clause 4 of the said letter (7.4.1960) states that "the Manager of the Mills is being requested to deliver possession to you at once and rent will commence from the date of delivery of possession to you." Importantly Clause 3 of the letter in issue states that "In a few rooms some furniture and other material of the Mills is at present locked. These rooms will be placed at your disposal after the goods lying those rooms is sold out.
These rooms will be placed at your disposal after the goods lying those rooms is sold out. You shall not claim any reduction in rent for the period those rooms remain locked nor shall we claim any extra rent upon the same being vacated and placed at your disposal." There was nothing on record at the instance of the objectors before the Executing Court as to what portion of "Patni Bhawan" and appurtenant lands (including garage and tennis court) was indeed handed over by the Official Liquidator to M/s. Mahesh Metal Works and when. Further there was also no evidence to show which portion of "Patni Bhawan" and appurtenant land was allegedly sub-let to the objectors. The whole case of alleged sub-tenancy set up by the objectors was thus vague, wishy-washy and lacking in certainty otherwise essential for a valid contract:- of the alleged sub-tenancy purportedly created in their favour by the main-tenant. The Hon'ble Apex Court in M/s. Technicians Studio Private Ltd. v. Smt. Lila Ghosh and Another, (1977) 4 SCC 324 has held that the answer to the question whether a relationship of tenant and landlord exists between the parties is dependent upon the facts and circumstances gathered in a case. On that test, in the case at hand, in the absence of any iota of evidence to make out a tenant-landlord relationship between the "main-tenant" and the objectors/resistors, it has not been proved that they were the sub-tenants of the "main-tenant" M/s. Mahesh Metal Works and ever inducted in the suit property in that capacity. The sequitur is that the objectors/resistors had no modicum right to bring their case within the words "just cause" under Order 21 Rule 98(2) CPC and to resist the execution of the judgment and decree lawfully passed by a Company Court in company application No. 21/1980 under sections 446 and 477 of the Act of 1956 on 5th February 1987 directing eviction of M/s. Mahesh Metal Works-the tenant-inducted under letter/agreement of lease dated 7.4.1960.
In Silverline Forum Pvt. Ltd. v. Rajiv Trust and Another, (1998) 3 SCC 723 , the Hon'ble Apex Court has held that adjudication of an application under Order 21 Rule 97 read with Rules 101 and 102 as also section section 35 (1) CPC, 1908 need not be based on detailed enquiry or evidence and it is in the discretion of the Executing Court to even decide the objection application on the basis of the pleadings of the parties, without any detailed enquiry where it finds that no prima-facie case by the objector/resistor was made out. Further, the Hon'ble Apex Court in Suresh Chand Jain v. IIIrd Addl. District Judge, Mathura, (2001) 10 SCC 508 has held that where a decree of eviction against the tenant attained finality, the sub-tenant did not have any independent right to raise objection before the Executing Court and was legally bound by the orders passed against the main tenant even-if the sub-tenant was not a party in eviction proceedings. In the case of Rupchand Gupta v. Raghuvanshi (Private) Limited & Anr., AIR 1964 SC 1889 the Hon'ble Apex Court had the occasion to consider a matter in which a landlord brought a suit against his tenant for ejectment without impleading the sub-tenant as a co-defendant. The tenant did not contest the suit, consequent to which an ex-parte decree was passed. The sub-tenant then filed a suit against the landlord and the tenant seeking a declaration that the decree against the tenant resulting from collusion between him and the landlord was not binding upon him as a sub-tenant. The Hon'ble Apex Court however repelled the argument and held that the law did not require that a sub-tenant be made a party in an eviction petition by a landlord against his main-tenant and a decree of ejectment against the tenant would be equally binding upon the sub-tenant. Similarly, in Balawant N. Viswamitra & Ors v. Yadav Sadashiv Mule (deceased by L.Rs.) and others, AIR 2004 SC 4377 the Hon'ble Apex Court reiterated its view and held that: "In our considered opinion, the present respondents could not be said to be "necessary party" to the suit. Non-joinder of respondents, hence, would not make a decree passed by the Court of Small Causes, Bombay nullity or inexecutable.
Non-joinder of respondents, hence, would not make a decree passed by the Court of Small Causes, Bombay nullity or inexecutable. The High Court erroneously proceeded against the well settled principle of law by observing in the impugned judgment that since the respondents (petitioners before the High Court) were claiming through Papamiya and as they were not joined as party in the suit, the orders passed by the Court "would in no way affect or bind them." The above observations, in our opinion, did not lay down the law correctly." 11. In the context of the aforesaid enunciation of law by the Hon'ble Apex Court, it is quite apparent that even in the event of the objectors/resistors having proved their sub-tenancy created by the main tenant M/s. Mahesh Metal Works, the judgment & Decree dated 5.2.1987 passed by the Company Court at the instance of the Official Liquidator against the tenant M/s. Mahesh Metal Works would be binding on them. That is however besides the point as in the case at hand, as detailed here-in-above no subtenancy created in favour of the objectors/resistors by M/s. Mahesh Metal Works was proved before the Executing Court. In my considered opinion in the facts of the case the objectors/resistors have no legal right to resist the Judgment & Decree dated 5.2.1987. I also find no force in the contention of the counsel for the objectors/resistors that the Official Liquidator had no authority to move the application bearing No. 21/1980 under sections 446 and 477 of the Act of 1956 before the Company Court seeking eviction of M/s. Mahesh Metal Works which was inducted as a tenant under the letter/agreement to lease dated 7.4.1960 on the ground that the Company Court itself subsequently vide order dated 15.10.1982 held that Patni Bhawanan appurtenant land the tenanted premises were the property of Maharaja Kishangarh Somyog Mills Co. Ltd and not of the company in liquidation i.e Maharaja Kishangarh Mills Ltd. The argument was that the "Patni Bhawan" and appurtenant land thus not being in the ownership of the company in liquidation, the Company Court had no jurisdiction in respect thereof at-least when the Judgment & Decree was passed on 5.2.1987. For one this issue was not agitated in the objections filed before the Executing Court.
For one this issue was not agitated in the objections filed before the Executing Court. The Hon'ble Apex Court in Venkatappa @ Moode (dead) by LRs v. M. Abdul Jabbar and others, (2006) 9 SCC 235 has held that no new case can be set up in an appeal. Besides, in my considered opinion there is also substance in the argument raised by the counsel for the Official Liquidator that the ownership of the property is not a matter of relevance in an eviction petition which is dependent upon the landlord-tenant relationship. Mr. Gaurav Sharma, counsel for the Official Liquidator is right in stating that in terms of definition of landlord under section 3(iii) of the Act of 1950, the Official Liquidator, having inducted M/s. Mahesh Metal Works as tenant into "Patni Bhawan" under letter/agreement to lease dated 7.4.1960 and having received rent from M/s. Mahesh Metal Works, was the landlord. And this is also an admitted fact by the objectors/resistors, submitted the Official Liquidator's counsel, as this background was the very foundation of the case of the objectors/resistors who set up their purported sub-tenancy (not proved) under clause 2 of the letter/agreement to lease dated 7.4.1960 under the hand of the Official Liquidator of the Company in liquidation to M/s. Mahesh Metal Works. In the circumstances, the Official Liquidator being the landlord of M/s. Mahesh Metal Works, was entitled to move an application for the tenant's eviction inter-alia on the ground of default. The learned Company Court, therefore, had jurisdiction to address the said application for eviction filed under sections 446 and 477 of the Act of 1956 and pass an order of ejectment of the tenant on 5.2.1987. 12. There is also no force in the submission of counsel for the objection with regard to the Addl. District Judge purportedly lacking in pecuniary jurisdiction for execution of the Judgment & Decree dated 5.2.1987. The Hon'ble Supreme Court has held in Mantoo Sarkar v. Oriental Insurance Co. Ltd. (2009) 2 SCC 244 has held that where the trial court has subject matter jurisdiction, its lack of pecuniary jurisdiction or even territorial jurisdiction, does not vitiate its judgment until prejudice is shown by the appellant.
The Hon'ble Supreme Court has held in Mantoo Sarkar v. Oriental Insurance Co. Ltd. (2009) 2 SCC 244 has held that where the trial court has subject matter jurisdiction, its lack of pecuniary jurisdiction or even territorial jurisdiction, does not vitiate its judgment until prejudice is shown by the appellant. On this test of law, laid down by the Hon'ble Apex Court, the argument of the counsel for the objectors based on purported lack of pecuniary jurisdiction of the Executing Court in passing the order dated 21.4.2014 (when no prejudice has been pleaded, and argued) is liable to be rejected. So it is. 13. In the circumstances obtaining, I find no error, legal or factual in the impugned order dated 21.4.2014 passed by the Executing Court. The conclusions of the Executing Court are based on an objective consideration and evaluation of the material evidence on record before it. There is no force in these misc. applications filed there-against. *******