JUDGMENT

Sanjiv Khanna, J.

1. Manju Bagai, the petitioner seeks winding up of M/s. Magpie Retail Limited, the respondent company under Section 433 (e) of the Companies Act, 1956 (hereinafter referred to as Act, for short).

2. It is stated that the petitioner is the owner landlady and had rented out commercial space No.UGF-1, Wedding Souk (now known as Gold Souk), Local Shopping Centre, Sharda Niketan, Pitampura, Delhi,(hereinafter referred to as the premises, for short) to the respondent company on a monthly rent of Rs.1,29,580/- excluding water, electricity charges. The respondent company started paying rent with effect from 1st November, 2006 and while the same was continuously paid till the end of February, 2007, the respondent company did not pay the agreed rent for the months of March, April and May, 2007 and handed over the possession of the premises on 31st May, 2007. Thus the respondent company is liable to pay rent from March, 2007 to May, 2007 of Rs.3,88,740/-.

3. The petitioner relies upon clause 5 of the "Agreement to Lease" dated 5th September, 2006 and submits that the respondent company is liable to pay liquidated damages in form of rent for a period of 29 months i.e. unexpired portion of the lease of three years starting with effect from 1st November, 2006. For the sake of convenience, the said clause is reproduced below:

" 5 That this Agreement to Lease shall not be cancelled before the lock-in-period of 3 years. A monthly rent will be liable to be enhanced by 15 % of the last paid rent after every 3 years. In case Tenant surrenders the Unit/Shop/Space before the lock-in-period then the Landlord/owner will be entitled to the liquidated damages from Tenant at the rate of rent for the balance period of 3 years. lock-in-period. To illustrate, if Tenant surrenders the Unit/Shop/Space, after 6 months from the date of offer of the possession of the said Unit/Shop/Space, then he will have to pay the liquidated damages at the rate of rent for the period of remaining 30 months."

4. Thus in all, the petitioner claims that the respondent company is liable to pay Rs.3,88,740/- towards arrear of rent and liquidated damages of Rs.37,57,820/-; total Rs.41,46,560/- and interest.

5. Agreement to Lease dated 5th September, 2006 is an unregistered document and is stamped on Rs.100/- stamp paper. The contention of the petitioner is that the said document is an Agreement to lease and not an Agreement of Lease. The distinction between the two is well known. Agreement of Lease has the effect of demise of the property in praesenti. An Agreement for/to lease merely entitles the parties to execute another deed or agreement in future. It does not create any right in praesenti. It is only an executory agreement in form of a promise to enter into a future agreement. An agreement of lease requires registration but agreement to lease in future does not require registration. It does not create any interest in an immovable property as has been observed by the Supreme Court in Food Corporation of India and Others Vs. Babulal Agrawal, (2004) 2 SCC 712.

6. In State of Maharashtra Vs. Atur India (P) Ltd., (1994) 2 SCC 497 it has been observed as under:

"24. The facts mentioned above are clearly indicative of an agreement to lease and not an agreement of lease. The distinction between the two may be seen first with reference to English law. Woodfall in Law of Landlord and Tenant, Vol. I, 28th Edn., 1978 at page 127 states as under :

"A contract for a lease is an agreement enforceable in law whereby one party agrees to grant and another to take a lease. The expressions 'contract for lease' and 'agreement for lease' is to be preferred as being more definite, agreement frequently means one of many stipulations in a contract. A contract for a lease is to be distinguished from a lease, because a lease is actually a conveyance of an estate in land, whereas a contract for a lease is merely an agreement that such a conveyance shall