USHA HARSHAD KUMAR DALAL versus M/S. ORG SYSTEMS AND ORS.

Citation: [2000] 1 S.C.R. 57 · Decided: 06-01-2000 · Supreme Court of India · Bench: S.P. KURDUKAR, S.S.M. QUADRI · Disposal: Dismissed

Judgment (excerpt)

USHA HARSHAD KUMAR DALAL 
A 
v. 
M/S. ORG SYSTEMS AND ORS. 
JANUARY 6, 2000 
[S.P. KURDIJKAR AND SYED SHAH MOHAMMED QUADRI, JJ.] 
B 
Rent Control & Eviction : 
Bombay Rents, Hotel and Lodging Houses Rates Control Act, 1947 : 
Sections lS and ISA-Sub- letting-Suit premises given to R-2 by a Leave C 
and Licence Agreement in 1970-Sub-letting to subsidiaries and affiliate 
concerns allowed by the Agreement-The Act amended in 1971--Subsisting 
licensees became tenants governed by the Act-Sub-letting made a ground of 
eviction--Suit for partition filed between the co-owners of the suit property in 
the High Court-<:ourt Receiver took symbolic possession of the suit premises 
as R-2 found in occupation-- R-1 came into possession in 1979 pursuant to D 
amalgamation of R-2 into the parent company of R-1-lnduction of R-1 in 
the suit premises challenged before High Court in the said suit-High Court 
directed Receiver to adopt proceedings under the Act for appropriate declara-
tion and relief--On appea~ Held: High Court failed to consider rival conten-
tiorn--High Court did not consider the effect of non-renewal of the licence E 
agreement after its expiry-Effect of Section JS and ISA not con-
sidered-Order of the High Court quashed-Matter remitted back. 
Code of Civil Procedure, 1908: Order XL Rules 1 and J-Appointment 
of Court Receiver--<:ourt Receiver acts on behalf on the Court-Duty of the 
Court Receiver to maintain status quo and to protect property-Receiver not F 
to deal with the property without leave of the Court-{)b/igation of the Court 
as well as the Receiver to preserve and maintain the property as far as 
practicable in the ;·ame f onn when it was taken into possession. 
The appellant is one of the co-owners of the property in dispute. In 
1970, the co-owners of the suit property entered into a Leave and Licence G 
Agreement with R-2 company, permitting R-2 to occupy the premises on 
certain terms and conditions. The said licence W'dS renewable for a further 
term of five years un a three months' notice and the Licensees were alsu 
entitled to give the licensed premises or any portion thereof to their own 
subsidiary or affiliate companies/concerns etc. Before the expiry of the H 
57 
58 
SUPREME COURT REPORTS 
(2UC0] 1 S.C.R. 
A licence period of five years, an amendment in the Bombay Rents, Hotel alid 
Lodging Houses Rates Control Act, 1947 was introduced in 1973 whereby 
subsisting licensees became protected tenants and were governed by the 
said Act. Section 15(1) of the Act provided that subject to any contract to 
the contrary, it was unlawful for any tenant to sub-let the whole or any part 
B of the premises let to him or to assign or transfer in any manner. The Act 
also made the landlord entitled to recover possession of the premises on 
that ground. After the expiry of the Leave and Licence Agreement in 1975, 
occupation of the suit premises by R-2 was governed by provisions of the 
Act. In 1978, the appellant filed a suit in the High Court for partition and 
possession of her share in the suit property against M who was another 
C co-owner of the said suit property. The High Court, by an interim order, 
appointed a Receiver to the suit property directing him to take possession 
and manage the suit property and do all other incidental things in relation 
thereto. 
D 
When the Court Receiver came to be appointed, the suit premises was 
found tu be in possession of R-2 company, therefore, the Receiver took 
symbolic possession. The said interim order was confirmed later. In 1996, 
some of the co-owners took Chamber Summons bringing to the notice of the 
High Court the fact that when the Court Receiver took symbolic possession, 
R-2 was in occupation but thereafter the said premises was being occupied 
E by R-1 company. On the High Court's direction, the Receiver filed a report 
stating that the sign board was in the name of R-1; premises was in posses-
sion of R-1 and that S.G. Pharmaceuticals and R-1 were two companies of 
the same group. In its affidavit before the High Court against the Chamber 
Summons, R-1 stated that tbe name of R-2 i.e. Suhrid Geigy Trading Ltd. 
F was changed to S.G. Pharmaceuticals Ltd. and in 1981, by an order of the 
Gujarat Higlt Court, tbe said S.G. Pharmaceuticals was amalg-dmated into 
Ambalal Sarabhai Enterprises Ltd. and thereafter the said ORG Systems 
i.e. R-1 was given possession uf the premises as it was the electronics 
division of Ambalal Sarabhai Enterprises Ltd.

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