JABAL C. LASHKARI & ORS. versus OFFICIAL LIQUIDATOR & ORS.

Citation: [2016] 2 S.C.R. 541 · Decided: 29-03-2016 · Supreme Court of India · Bench: RANJAN GOGOI · Disposal: Disposed off

Judgment (excerpt)

[2016] 2 S.C.R. 541 
JABAL C. LASHKARI & ORS. 
v. 
OFFICIAL LIQUIDATOR & ORS. 
(Civil Appeal Nos. 3147-49 of2016) 
MARCH 29, 2016 
[RANJAN GOGOi AND PRAFULLA C. PANT, JJ.] 
Bombay Rents, Hotel and Lodging House Rates Control Act, 
1947: ss.12, 15 - Predecessor of appellant had leased out land for 
199 years - Secured creditors of lessee filed winding up petition -
Pending same, appellants filed suit seeking permanent injunction 
against sale of assets of co111pany particularly sale of leased 
property ·- Company judge passed winding up order and order for 
appointment of Official Liquidator (Ol) - Co111pany application by 
appellants for return of leased property on the grounds that in view 
of winding up order the company no longer required the leased 
land and furthermore default in payment of rent had occurred and 
that OL was not authorised to transfer the leased property in view 
of Rent Act of 1947 - Pending company application, advertisement 
for sale of leased land - Appellant filed company application for a 
declaration that the OL had no right to sell the leased property -
Another company application filed seeking permission from the 
Company Court to file a suit for eviction of OL from the leased 
property - Company Co1irt rejected all the applications - High Court 
upheld the same - On appeal, held: No notice issued by landlord 
for giving oppot:!_unity to tenant to pay unpaid rent -
In such 
situation, the readiness and willingness of the tenant to pay the 
rent, though may have continued for a fairly long time·without actual 
payment, will not deprive the tenant of the protection under the 
Rent Act - Therefore, landlord cannot seek eviction on the ground 
of non-payment of rent - Case of sub-letting and non user was also 
not made out by the appellant-landlord - Mere fact that the company 
has been ordered to be wound up cannot be a ground to direct OL 
to handover possession of the land to the owners inasmuch as the 
company in liquidation continues to maintain its corporate existence 
until it stands dissolved upon compldion of the liquidation 
proceedings in the manner contemplated by the Companies Act - In 
the instant case, it has been submitted before this Court that presently 
541 
A 
B 
c 
D 
E 
F 
G 
H 
542 
SUPREME COURT REPORTS 
[2016) 2 S.C.R. 
A 
revival of the company is a live issue pending before High Court, a 
fact which cannot be ignored by :his Court in deciding the above 
issue against the appellants - For these reasons, the order of the 
High Court is upheld. 
B 
c 
D 
E 
F 
G 
H 
Disposing of the appeals, the Court 
HELD: 1. Section 12 of the Rent Act confers protection on 
a tenant who is regularly paying or is ready and willing to pay the 
rent. In the present case, while there is no doubt that rent has 
not been paid, equally, there is no doubt that the secured creditors 
including the State Bank of India had all along been ready and 
willing to pay the rent and the reasons for non payment appears 
to be lack of communication by the official liquidator to the SBI 
of the precise amount of rent due. While there can be no doubt 
that mere readiness and willingness to pay without actual payment 
cannot enure to the benefit of the tenant in perpetuity what is 
required under Sub-section (2) ofSectiou 12 is a notice in writing 
by the landlord raising a demand of rc;nt and only on the failure of 
the tenant to comply with such notice within a period of one month 
that the filing of a suit for recovery of possession is contemplated. 
The service of notice giving an opportunity to the tenant to pay 
the uu paid rent is the first chance/opportunity that the Rent Act 
contemplates as a legal necessity incumbent on the landlord to 
afford to the tenant. Admittedly, in the present case, no such notice 
as contemplated by Section 13(2) has been issued by the landlord. 
In such a situation, !'he readiness and willingness of the tenant to 
pay the rent, though may have continued for a fairly long time 
without actual payment, will not deprive the tenant of the 
protection under the Rent Act. Though the order of the High 
Court has been placed before the Court as an order under Section 
12(3)(b) of the Rent Act, the said order is not of the kind 
contemplated by Section 12(3)(b) inasmuch as not only the order 
does not mention any specific rent which has to be tendered in 
Court but what is encompassed therein is a direction to the official 
liquidator to let the State Bank of India know the 

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