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2018 (10) TMI 120 - HC - Companies LawCompany under liquidation - right of the State on leased out property - application for determination of right over the property - Held that:- during liquidation proceedings, the State of Madhya Pradesh through its functionaries had filed an application that they are the owner/lessor of the property in question. However, the company court without dwelling on the same passed the liquidation order. The official liquidator on receiving the inventories since proceeded to put on auction the land in question, in our considered opinion, it was well within the right of the State to have moved an application for determination of their right over the property. The analysis takes care of the submissions on behalf of the official liquidator that it will be beyond the jurisdiction of the Company Judge to dwell upon the dispute as to the title over the land in question. And dispels the doubt as to whether it was within the competence of the Company Judge to have entertained the application on merit. To conclude, when the impugned order is tested on the anvil of above analysis, it cannot be given the stamp of approval. Consequently, it is set-aside. Application filed by the State of Madhya Pradesh claiming to be the owner of the immovable property in question, being the successor of erstwhile owner, is allowed. It is held that the lessee and subsequent transferee from the original lessee did not incur absolute right and title in the immovable property in question. In other words, they continue to remain as lessee. And the object for which the land was leased out being frustrated, on winding up of the company in question; the land leased out to it stands reverted to its owner, the State of Madhya Pradesh. As a consequence whereof, it is held that the official liquidator has no right to auction the leased property in question.
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