Liquidator cannot be summarily evicted if continued possession of tenanted premises serves relevant liquidation purposes.

The Applicant is the landlord of a 1,100 sq. ft. office premise in Fort, Mumbai, which has been tenanted by the Bank of Karad since 1962

Following winding-up orders in 1992 and 1994, the Respondent (Official Liquidator) took possession of the premises to manage the Bank’s affairs and store records

In 1999, the Applicant filed a similar application for possession (Company Application No. 429 of 1999), which was dismissed in 2001 on the grounds that the Liquidator required the premises for storage and correspondence

In 2017, the Applicant filed the present application citing "changed circumstances," specifically that the number of pending litigations involving the Bank had reduced from 75 to approximately 11 and that the Bank had no ongoing business

The Applicant offered to provide alternate premises on a leave and license basis and digitize the Bank’s records at its own cost

1. Whether the reduction in pending litigation and the offer of alternate premises constitute "changed circumstances" sufficient to warrant the return of the premises under Section 457 of the Companies Act, 1956

2. Whether the present application is barred by the principles of res judicata or issue estoppel due to the dismissal of the 1999 application

3. Whether the Company Court can summarily compel a Liquidator to relinquish statutory tenancy rights in exchange for a leave and license arrangement

The Court primarily applied Section 457 of the Companies Act, 1956, regarding the summary jurisdiction of the Company Court over assets in liquidation

It relied on the Supreme Court’s holding in Nirmala R. Bafna v. Khandesh Spinning and Weaving Mills Co. Ltd., which established that a Liquidator may retain premises if the reason for doing so (such as storing records) is "relevant"

The Court also considered Sections 26 and 56 of the Maharashtra Rent Control Act, 1999, regarding the prohibition of unauthorized transfer of tenancy and the potential for monetization of tenancy rights

Furthermore, it applied the principles of res judicata and issue estoppel to prevent the re-litigation of issues decided in the 2001 order

The Court determined that the grounds raised in the present application were virtually identical to those rejected in 2001, rendering the application barred by res judicata

It clarified that the 2001 order did not grant liberty to file a fresh application but merely noted that the Applicant could offer alternate premises for the Liquidator to evaluate at his own discretion

Applying the Nirmala Bafna test, the Court found that as long as liquidation proceedings are ongoing, the storage of records—even if reduced in volume—remains a "relevant reason" for the Liquidator to occupy the premises

The Court rejected the Applicant’s argument that the Liquidator must digitize records or move to a license-based premise, holding that the Liquidator cannot be summarily deprived of vested statutory tenancy rights through summary proceedings under Section 457

The Court also noted that the Applicant had failed to prosecute its pending eviction suit in the Small Cause Court, opting instead for this summary route

The Court ruled that the Respondent’s need for the premises for storage and official correspondence remains valid until the conclusion of the liquidation process

The Applicant was ordered to pay costs of Rs. 1,00,000/- to the Respondent for wasting judicial time