Determination of tenancy by the landlord from 1.2.1989 if contractional or statutory.

Application No.348 of 1989 was filed by the petitioners in Insolvency Petition No.9 of 1989, who were adjudicated as insolvents on their own petition to direct the Official Assignee to deliver the key of the shop to them so as to enable them to resume their business in No.30/2, Godown Street, Madras-1.

.2. Application No.224 of 1989 was filed by B.Vedachalam who is the owner of the premises No.30/2, Godown Street, Madras to direct the Official Assignee to remove the movables that are available in the premises and deliver vacant possession of the above premises occupied by the first and second respondents (insolvents/tenants) the applicants in Application No.224 of 1989. The short facts are:

Mr.B.Vedachalam is the owner of the premises No.30/2, Godown Street, Madras-1. The petitioners in Application No.348 of 1989 and in Insolvency Petition No.9 of 1989 are the partners of M/s.Satyanarayana and Company. They were carrying on the business in the above-premises. They were adjudicated as insolvents on their own petition by an order of this Court dated 2. 1989. They are brothers. They were carrying on wholesale business in textile goods. Their case is that as they have been adjudicated as insolvents their tenancy will not cease and that therefore they are entitled to possession of the shop and the key with the Official Assignee be delivered to them. The landlord Vedachalam has filed a petition for eviction against them in R.C.O.P.No.326 of 1989 on the file of Small Causes Court, Madras.

3. Mr.R.Krishnaswamy, learned counsel appearing for the insolvents/tenants submits that the landlord Vedachalam gave notice according to the terms of the agreement under which the lease had to exist for a period of ten years from 1. 1981 to 312. 1990 and had already taken action in accordance with the provisions of Tamil Nadu Buildings (Lease and Rent Control) Act, which fact has not been disputed by the learned counsel for the landlord. But according to him, notwithstanding the notice or the institution of the action in the Court of the Rent Controller for eviction of the appellants/tenants, the tenancy is still continued under the agreement as a fixed term tenancy and thus a contractual tenancy.

4. As stated above, B.Vedachalam, the landlord filed Application No.224 of 1989 for delivery of possession of the said premises back to him, while the tenants filed Application No.348 of 1989 for directing the Official Assignee to deliver the key of the premises to enable them to resume their business.

.5. Abdul Hadi, J. however, passed an order on 11. 1989, rejecting the application taken out by the tenants on the ground that on the determination of insolvency in the main Insolvency Petition No.9 of 1989 by order dated 2. 1989, the properties belonging to them including their leasehold vested with the Official Assignee. Learned single Judge accordingly rejected Appln. No.348 of 1989. In Appln. No.224 of 1989, however, he took note of the stand of the Official Assignee that accrual of unnecessary rental liability would be avoided if the premises could be handed over to the landlord and allowed the said Application directing the Official Assignee to hand over possession of the above said premises to the landlord Vedachalam. Both the two applications were disposed of by Abdul Hadi, J. by a common order. Only one Appeal had been preferred under Sec.15 of the Letters Patent against the order of the learned single Judge. Learned Judges of the Division Bench overruled the objections that have been raised on behalf of the respondents in O.S.A.No.361 of 1989 and permitted the appellant to prosecute the appeal before them filed against the common order. The question that was raised before the Division Bench of this Court was whether the leasehold was a property that on adjudication of the petitioners in the Insolvency Petition vested with the Official Assignee. Abdul Hadi, J. has said that it was a property that vested with the Official Assignee, a fi