Leave of the winding up court is not required for every application in the progress of a suit or legal proceeding, such as an application for amendment of the plaint. Grounds of ejectment are not a part of the cause of action in a suit for eviction filed by a landlord against a tenant.

Headnote:
AMENDMENT OF PLAINT - LEAVE OF WINDING UP COURT - COMPANIES ACT, 1956, SECTION 446(1) - BOMBAY RENTS ACT, 1947, SECTION 12 - GROUNDS OF EJECTMENT - CAUSE OF ACTION - ORDER 6, RULE 17, CODE OF CIVIL PROCEDURE - Leave of the winding up court is not required for every application in the progress of a suit or legal proceeding, such as an application for amendment of the plaint. Grounds of ejectment are not a part of the cause of action in a suit for eviction filed by a landlord against a tenant.
Fact of the Case:

The petitioners, who were ordered to be wound up, filed a suit for possession of certain premises against their tenants. They later made an application to the trial court for amendment of the plaint by adding two grounds for ejectment and to include permitted increases in their money claim. The trial court rejected the application on the ground that leave of the winding up court was not taken for filing the amendment application under section 446(1) of the Companies Act, 1956.
Finding of the Court:

The court held that once leave of the winding up court is obtained to commence or proceed with the suit or other legal proceedings, no application in the progress of that suit or legal proceeding will require fresh leave of the winding up court. The court also held that grounds of ejectment are not a part of the cause of action in a suit for eviction filed by a landlord against a tenant.
Issues: 1. Whether leave of the winding up court is required for every application in the progress of a suit or legal proceeding? 2. Whether grounds of ejectment are a part of the cause of action in a suit for eviction filed by a landlord against a tenant?
Ratio Decidendi: 1. The court held that the words "other legal proceeding" in section 446 of the Companies Act, 1956, are not to be confined to original proceedings in the court of first instance analogous to a suit initiated by means of a petition similar to a plaint. However, once the winding up court has granted leave to commence or proceed with the suit or other legal proceedings against the company, it cannot be that leave of the winding up court must be obtained to commence or proceed with every application in the progress of the suit, such as an application for striking out or adding other parties, serving summons by registered post, obtaining further and better particulars of pleadings, amending pleadings, setting aside ex-parte orders or decree, getting discovery or inspection, summoning witnesses, issuing commissions, applying for adjournments or extension of time for complying with the orders of the court. 2. The court held that "cause of action" means every material fact which, if traversed, it would be necessary for the plaintiff to prove in order to support his right to judgment. In a suit for eviction filed by a landlord against a tenant the right to sue and to get judgment arises from the determination of the tenancy by efflux of time, expiration of notice to quit or otherwise as provided in section 111 of the Transfer of Property Act. It is then that the landlord becomes entitled to evict or to recover possession from the tenant. Section 12 of the Bombay Rents Act provides that no ejectment shall ordinarily be made if the tenant pays or is ready and willing to pay standard rent and permitted increases. It provides a protection for the tenant against eviction after determination of tenancy. It creates an impediment in the way of the landlord recovering possession. Section 13 of the Bombay Rents Act provides certain conditions under which the protection of the tenant is taken away and the impediment in the way of the landlord recovering possession is removed. These conditions are termed "as grounds of ejectment". It is not necessary for a landlord to set out these grounds in the notice to quit as they are not a part of the cause of action of the landlord. The landlord sets out these grounds in the plaint, not because they constitute his cause of action, but in anticipation of the tenant claiming the protection provided in section 12, to show that conditions have arisen which have taken away the protection of the tenant and removed the impediment in the way of the landlord recovering possession. In the opinion of the court, the grounds of ejectment are not a part of the cause of action in such suit.
Final Decision: The court set aside the order of the trial court dated 7th October, 1963, and allowed the application dated 3rd July, 1963, for amendment.

JUDGMENT - Nain, J.

1. This is a revision application under the provisions of section 115 of the Code of Civil Procedure against an order dated 7th October, 1963, of a Judge of the Small Cause Court at Poona, rejecting the petitioners application for amendment of the plaint in a suit filed by them against their tenants for eviction.

2. The facts leading to this matter are that the petitioners have filed a suit for possession of certain premises consisting of three plots, included in premises at 38, Shankar Shet Road, Poona. The petitioners claim to be the owners of this property and they let it out to the respondents on 22nd August, 1946, for a period of 20 years under a registered lease deed and that the standard rent of the premises is Rs. 500 per mensem. The petitioners allege that the respondents are in arrears of rent and have not complied with a notice under section 12(2) of the Bombay Rent Act. The claim of the petitioners has been opposed by the respondents on various grounds.

3. On 3rd July, 1963, the petitioners made an application to the trial court for amendment of the plaint by adding two grounds for ejectment, namely, that the respondents had not been using the suit property for a period exceeding six months for the purpose for which it was let and they also wanted to include permitted increases in their money claim. This application was rejected on 7th October, 1963. Thereafter, the petitioners filed a revision application under section 29(3) of the Bombay Rent Act in the District Court at Poona. Curiously, this revision application was returned to them on 9th June, 1963, for presentation to the proper court. Under section 29(3) of the Bombay Rent Act, it is the District Court which is the proper court. Instead of pursuing that revision application further, on 15th June, 1964, the petitioners filed the present revision application in this court. As in any event this court had the power to call for the record and proceedings of the lower court and to examine whether the lower court had failed to exercise jurisdiction vested in it by law, I condoned the delay in making the application and I have heard the application on merits.

4. The respondents raised several objections to the amendment application. The learned trial judge considered the said objections such as delay in making the application, whether the nature of the suit would be changed by the amendment, whether any prejudice would be caused to the respondents by introduction of a new ground of ejectment which constituted a new cause of action, and came to the conclusion that the amendment application should not be rejected on these grounds. Having come to that conclusion, he, however, refused to allow the application on the ground that leave of the winding up court was not taken for filing the amendment application under section 446(1) of the Companies Act, 1956, as such leave had been taken in respect of the suit itself, the suit against the respondents having been instituted after they had been ordered to be wound up.

5. Section 446(1) of the Companies Act, 1 of 1956, reads as under :

"446. (1) When a winding up order has been made or the official liquidator has been appointed as provisional liquidator, no suit or other legal proceeding shall be commenced, or if pending at the date of the winding up order, shall be proceeded with, against the company, except by leave of the court and subject to such terms as the court may impose."

6. Section 537(1) of the said Act reads as under :

"537. (1) Where any company is being wound up by or subject to the supervision of the court -

(a) any attachment, distress or execution put in force, without leave of the court, against the estate or effects of the company, after the commencement of the winding up; or

(b) any sale held, without leave of the court, of any of the properties or effects of the company after such commencement;

shall be void."

7. I might here mention that section 171 of the Indian Companies Act, 1913,

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