Right of tenant to remain in possession.

This is an application filed by the insolvent Mohanrangiah Chetty under the following circumstances. He had been carrying on business in textiles at No. 90, Godown Street, Madras, for 20 years. He contracted debts in the trade and he was adjudicated insolvent on 21st January, 1964, on a creditor’s petition. During the pendency of the insolvency proceedings, one creditor, Devi Singh, had obtained an order of attachment before judgment of the stock-in-trade in the place of business. Later, the Official Assignee took vacant possession thereof on 3rd February, 1964. He has locked up the premises. The insolvent says in the application that there are several businessmen who are prepared to take him as a working partner, if permission could be given by this Court to carry on the textile business at 90, Godown Street. He says that the persons concerned had promised that the insolvent himself would not have any liability for the loss or debts in the business. He says that if permission is granted he is prepared to make arrangements with the landlord for the running of the business there. He submits that the lease was not for any fixed term and there was no leasehold right to vest in the Official Assignee, and the Official Assignee would not be liable for the future rents. He points out that he has a large family and has no other source of income to maintain himself and his family. He undertakes to keep regular accounts and to abide by the directions of the Court in the conduct of the business.

The application is opposed by the Official Assignee.

In the course of the hearing of the petition I felt it desirable to issue notice to the landlady of the premises. She appeared by Counsel Sri A. Subramaniam.

The main question which was mooted in the arguments before me by Mr. S. Rangaswami Ayyangar, learned Counsel for the insolvent-applicant, was that though in its inception the tenancy might have been a monthly tenancy governed by the provisions of the Transfer of Property Act, yet after the passing of the Acts relating to the letting of residential and non-residental buildings in the City, the last of which is the Madras Buildings (Lease and Rent Control) Act, 1960 (XVIII of 1960) the insolvent became a statutory tenant and the relationship between him and the landlord (the terms used in the Act, which includes even the landlady) would be governed by the provisions of the Act and on a true construction of these provisions he has only a personal right to occupy the premises as a tenant, that this personal right is not property within the meaning of section 17 of the Presidency Towns Insolvency Act which would vest in the Official Assignee, that consequently the Official Assignee need not fear that he would be liable to pay rent for the future occupation of the premises, that the question of future occupation of the premises is one which concerns only the insolvent and the landlady and that the Official Assignee has no right to retain possession of the keys. The learned Counsel conceded that if the landlady should choose to evict the insolvent following the procedure prescribed under the Madras Buildings (Lease and Rent Control) Act, 1960, he would have to submit to it in due course. In support of his contention that the insolvent’s rights of occupation is only statutory under the provisions of the Madras Buildings (Lease and Rent Control) Act and is not property which can vest in the Official Assignee, the learned Counsel has cited the decision of Bhagwati, J., (as he then was; in Peregnno Rodrigues, In re1. That decision certainly supports the contention. That decision was given under the Bombay Rent Restriction Act, 1939 and it was held that the statutory tenancy to which the insolvent became entitled by virtue of that Act was not property, within the meaning of section 62 of the Presidency Towns Insolvency Act and did not vest in the Official Assignee by the adjudication order and it was not therefore necessary for the Official As