National Textile Corp.Ltd vs Nareshkumar Badrikumar Jagad & Ors

Trust issued a notice for terminating the tenancy of the appellant vide notice dated 26.9.2000. The respondents/plaintiffs after withdrawal of the suit filed under the Act 1947, filed a fresh suit in the Small Causes 3 Court at Bombay seeking eviction of appellant and for a decree of mesne profits on 20.4.2001. The appellant filed the written statement denying the pleas taken by the respondents/plaintiffs. The suit was decreed in favour of the respondents/plaintiffs vide judgment and decree dated 5.8.2006 by which the appellant was directed to hand over vacant and peaceful possession of the suit premises to the respondents within four months.

E. Being aggrieved, the appellant preferred Appeal No. 627 of 2006 to the Division Bench of the Small Causes Court at Bombay on 13.11.2006 which was dismissed by the appellate court by affirming the judgment and decree of the trial court vide judgment and decree dated 14.8.2008. The appellant preferred civil revision before the High Court of Bombay, which has been dismissed vide impugned judgment and order dated 3.8.2009.

Such tenancy rights stood vested absolutely in the Central Government on commencement of the Act 1995 by operation of law. The appellant stepped in the shoes of the Central Government merely as an agent, thus, the Central Government remained the tenant. The Central Government continued to be a tenant in the suit premises and thus, would be protected in terms of Section 3(1) (a) of the Act 1999 being premises let out to the Government. The courts below failed to consider this vital legal issue. The suit filed by the respondents was not maintainable. The judgments and decrees of the courts below are liable to be set aside.

Findings of fact cannot be recorded on a issue on facts in respect of which no factual foundation has been laid. The appellant had never 5 raised the issue before the courts below that the Central Government was the tenant and it was holding the premises merely as an agent. In the written statement filed by the appellants, no reference was made to the provisions of Act 1995. Even otherwise, the tenancy rights which had vested in the Central Government, stood vested immediately, by operation of law, in the appellant, a public sector undertaking as well as the public limited company having a paid up share capital of more than rupees one crore, thus the appellant has no protection of the Act 1999.

Right vested in the Central Government stood transferred and vested in the appellant. Both are separate legal entities and are not synonymous.

30. Thus, in view of the above, we reach the inescapable conclusion that appellant is not entitled for exemption under 2 Section 3(1)(a) or 3(1)(b) of the Act 1999. Nor can it claim the status of an `agent' of the Central Government. Submissions advanced on behalf of the appellant are preposterous. Facts and circumstances of the case do not warrant review of the impugned judgment.

However, considering the nature of business of the appellant, it is in the interest of justice that appellant be given time upto 31.12.2013, to vacate the premises. Appellant shall file a usual undertaking within four weeks from today to hand over peaceful and vacant possession to the respondent No.1.

With the aforesaid observation, appeal stands dismissed.