(Per : HONOURABLE MR.JUSTICE RAVI R.TRIPATHI) 1. The Gujarat Industrial Development Corporation is before this Court through Assistant General Manager, challenging the judgment and order dated 17/01/2009 passed in Company Application No.558 of 2008 by the learned Company Judge, whereby, the learned Company Judge was pleased to held that “7.... keeping in mind the Provisions of Companies Act, 1956 in relation to assets of the company in liquidation and keeping in mind the dues of pre-liquidation period are to be settled in accordance with provisions. The GIDC cannot claim the payment of pre-liquidation dues from the applicant. The GIDC will have to lodge claim before the Official Liquidator, which shall be dealt with in accordance with provisions of law.”
2. Learned advocate Mr. MB Gandhi appearing for the appellant invited attention of the Court to the judgment and order passed by the learned Company Judge in Company Application No.33 of 2009, wherein, a similar question arose for consideration. The relevant part of that judgment and order reads as under:-
“3. It appears from the record produced before this Court that the following are the admitted positions.
(1) Whole estate of GIDC is owned by GIDC and the scheme of industrial estate in exercise of the powers under Gujarat Industrial Development Corporation Act has been floated over the land and particular plot has been allotted to the company in liquidation.
(2) As per the scheme, initially the possession has been handed over on licence basis and for such purpose the licence agreement was entered into. Copy whereof is produced on page 29.
(3) Such relationship based on the licence agreement is subsequently crystalised in to the lease agreement and the copy of the lease deed is also produced by GIDC executed between GIDC and the company in liquidation.
(4) Hence, GIDC is in capacity as the landlord- lessor of the property and the company in liquidation is in capacity as lessee of the property.
4. On the aspect as to whether the lessor is entitled to get back the possession of the property of the company in liquidation upon the winding up of the company may be on the ground that the company has stopped the business and it does not require the property for its objects, etc. the question is concluded by the decision of this Court in case of Legal Heirs of deceased Fakir Chand Ambaram Patel v. OL of Amruta Mills Ltd. and Ors. reported at 2002 (3) G.L.H. 367 and in the said case, ultimately, the Court has summarized at para 40 as under:
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 termini.
[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.
5. The aforesaid decision has been confirmed by the Division Bench of this Court.
6. If the matter is examined in light of the aforesaid position of law, GIDC would not be entitled to get back the possession of the property so long as the conditions and the obligations of the lease deed are complied with. Similarly, the rights of the allottee under the lease deed are of the properties of the company in liquidation and therefore if the O.L. has taken over the possession of the property by stepping into the shoes of the lessee, such an action cannot be said as illegal or void as sought to be canvassed on behalf of the applicant.
7. However, as per the above referred decision the condition in the lease deed by way of requirement to pay rent, per se, does not create an onerous covenant once the readiness and willingness is shown by the lessee or on its behalf to discharge such obligation. Therefore, for preservation of the rights as the lessee may be by the company in liquidation who was allottee or the OL stepping into the shoes of the company in liquidation, has to show the willingness to discharge all the obligations as per the lease deed and it is not open to the Official Liquidator to contend that outstanding dues of the lessor as per the lease agreement including the rent would fall in the category of debt of the company under Section 530 of the Act. The outstanding dues of the company with the other creditors including the secured creditors or the workers or statutory bodies would stand on different footing because so far as the landlord as the lessor and the company as the lessee is concerned, the relation cannot be termed as that of the creditor and the debtor. The relation between the lessor and the lessee is between the owner of the property and the allottee of the property whose right is created to the extent of lease. A life of lease is dependent upon compliance to the conditions of the lease and is not in capacity as the creditor who has to recover the amount. Even otherwise also, the lessor in capacity as the owner of the property would enjoy better right in the property than that of the lessee who may be put in possession under the express terms and conditions of the lease agreement. Therefore, the contention that the outstanding amount as per the lease deed would fall in the category of the debt of the company in liquidation cannot be accepted.
8. If the principles as observed in the above referred decision read with the observations made herein above are considered, it will be the obligation of the Official Liquidator to continue to honour and discharge the liability if any of the company in liquidation towards the lessor and it is only thereafter the OL may be in a position to sell the leasehold rights in the property of the company in liquidation.
9. Mr. Jani learned counsel appearing for the Official Liquidator at the first instance attempted to contend that even if such liability exists of the Official Liquidator it may be bifurcated into two parts i.e. up to the date of winding up and after the date of the winding up. He submitted that after the date of winding up, there is no liability of the OL to discharge the obligations with the lessor.
10. In this regard Rule 157 of the Company Court Rules may be relevant. The same reads as under:
157. When any rent or other payment falls due at stated periods, and the order or resolution to wind-up is made at any time other than one of those periods, the persons entitled to the rent or payment may prove for a proportionate part thereof up to the date of winding-up order or resolution as if the rent or payment accrued due from day to day. Provided that where the Liquidator remains in occupation of the premises demised to a company which is being wound-up nothing herein contained shall prejudice or affect the right of the landlord of such premises to claim payment by the company, or the Liquidator, of rent during the period of the company's or liquidator's occupation.
11. The aforesaid shows that if the Liquidator has remained in occupation of the premises demised to a company which is being wound up, the rights of the landlord of such premises to claim the payment by the company, or the liquidator, of rent during the period of the company's or liquidator's occupation, shall not be prejudiced or affected. Therefore, the liability to discharge the obligation as per the lease agreement with the lessor continues even after the date of winding up, would continue of the liquidator so long as the liquidator remains in occupation of the property. It may be that when the property is to be sold of the company in liquidation, the condition may be provided of liability to be discharged by the purchaser after the date of winding up and the said aspect at the most may remain in the arena of modulating the terms and conditions of the sale but thereby it cannot be said that the liquidator would be relieved of from the liability with the lessor as per the lease agreement merely because the company is ordered to be wound up or the same relates to the period after the winding up. As such, the rights of the lessee, which may be company in liquidation, flows from the better rights of the lessor in the property and if the property is to be made transferable in favour of any third party by way of sale through Company Court or otherwise, the obligations, if any, under the lease agreement are required to be discharged by the Official Liquidator so long as the possession of the property has remained with the O.L.
12. Under these circumstances, it appears that the following can be summarized:
(1) The rights of the company in liquidation of a property which is allotted by GIDC to the company would continue to remain as that of the lessee after the date of winding up.
(2) All obligations as existed prior to the winding up shall continue to remain as obligations even after the date of winding up until the property remains in occupation of the O.L. and sold to third party.
(3) The rights of the company in liquidation in capacity as the lessee of the property are salable interest which can be realized by sale under the supervision of the Company Court.
(4) Official Liquidator or the Sale Committee or the Company Court may provide for express condition in the sale for liability to be discharged with the lessor prior to the date of winding up by the Official Liquidator and to be borne by the purchaser after the date of the winding up. However, incorporation of such condition in no manner would adversely affect the rights of lessor for recovering the amount as per the lease deed from the property in question and such would be only by way of inter se arrangement between the OL in capacity as the vendor and the purchaser of the property.
(5) It will be for OL to settle the amount to be paid and/or payable by the company in liquidation with the lessor as per the lease agreement and to clear such outstanding dues. If the condition is expressly provided for liability to be discharged by the purchaser for the period after the date of winding up, the purchaser may settle such amount with lessor-GIDC.
(6) It will be required for GIDC to transfer the leasehold rights on the name of the purchaser after the sale has taken place under the supervision of the Company Court and the obligations, as per the lease agreement, are discharged prior to the transaction.
(7) The purchaser of the property – leasehold right shall step into the shoes of the original lessee – company in liquidation and the rights between the purchaser and GIDC – lessor shall continue to remain in operation as per the lease agreement after the date of the purchase.
(8) In the event, there is any dispute on the aspects of settlement of the amount recoverable by GIDC in capacity as the lessor either with the OL or with the purchaser, the matter can be considered by the Company Court for finalization of the amount and upon the payment so made to GIDC – lessor, it would not be open to GIDC-lessor to decline the transfer in favour of the purchaser.
(9) So far as any other liability of the lessee towards local taxes outstanding of the notified area, it can be termed as individual liability of such company in liquidation who is occupier of the property and such can be equated with the other taxes of the local authorities. As per the decision of the Apex Court in case of Aichampdany Industries Ltd.
v. Official Liquidator and Anr. reported in (2009) 4 SCC 486, the amount outstanding towards such taxes would fall in the category of debt under Section 530 and such taxes would not be recoverable as obligations to be discharged by the company in liquidation as lessee with GIDC.
2.1 Learned advocate for the appellant submitted that the said judgment and order was the subject matter of OJ Appeal No.70 of 2009, which came to be disposed of by the judgment and order dated 03/10/2012, wherein, this Court interpreted Paragraph-
9 of the order passed by the learned Company Judge in Company Application No.201 of 2009 dated 13/08/2009 by observing as under:-
“2.1... The rights of the company in liquidation of a property which is alloted by GIDC to the company would continue to remain as that of the lessee after the date of winding up”.
3. In the aforesaid paragraph, the learned Company Judge has denied the payment of interest under Rule 156 of the Company Court Rules, 1959. “If the interest payable by the applicant in liquidation, the applicant can lodge before the Official Liquidator in accordance with law. The Official Liquidator will be liable to pay dues in accordance with law“.
4. In the present case, the facts are little different and the judgment and order of the learned Company Judge in Company Application No.33 of 2009 will be squarely applicable to the facts of the present case. That being so, the present appeal is allowed and the Official Liquidator is directed to consider the claim of the appellant-GIDC in accordance with law and to make the payment to GIDC as per Rule-
156 and 157 of the Company Court Rules, 1959.
(RAVI R. TRIPATHI, J)
aruna
(N.V. ANJARIA, J)