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High Court of Judicature at Madras
VINOD K. SHARMA
M/s. Savitri Leasing and Finance Ltd. Rep. by its Director Anand Singhal
Versus
M/s. Spencer's Retail Limited
C.P.No. 33 of 2010
Decided On: 05-04-2011
Companies Act - Lease Agreement - Section 433, 434, 439 - The court dismissed the company petition filed under Sections 433, 434 r/w. Section 439 of the Companies Act, 1956, as the petitioner failed to establish a case for invoking the jurisdiction under the mentioned sections.
Fact of the Case:
The petitioner filed a company petition claiming that the respondent company failed to pay lease rentals and various charges, and terminated the lease prematurely. The respondent disputed the claims and contended that the petitioner misled the court with false averments.
Finding of the Court:
The court found that the petitioner failed to establish a case to invoke jurisdiction under the relevant sections of the Companies Act. The court also noted that the petitioner did not come to court with clean hands, as deliberate misstatements were made regarding the reply to the statutory notice.
Issues: Dispute over lease rentals and charges, premature termination of lease, misleading the court with false averments, failure to establish a case for invoking jurisdiction under the Companies Act.
Ratio Decidendi: The court held that the petitioner's failure to establish a case and deliberate misstatements disentitled it to equitable relief under the relevant sections of the Companies Act.
Final Decision: The company petition was dismissed, and the connected company applications were closed, with the petitioner being allowed to avail appropriate legal remedies in accordance with the law.
1. This company petition has been filed under Section 433 (e) r/w. Section 434 (1)(a) & (c) r/w. 439 (i) (b) of the Companies Act, 1956.
2. It is pleaded that the petitioner is owner in possession of a commercial complex over a plot No.3, Indira Palace, Malaviya Nagar, Jaipur. The respondent was granted lease in the said premises for area measuring around 24,923 sq.ft on the lower ground floor (hereinafter referred to as the 'Leased Premises'), and approximately 2750 sq.ft built up area on the basement of Commercial Complex within the permitted service area. Lease was executed on 5th October 2006 and subsequent, lease agreement was executed on 30.07.2007.
3. Lease rent was fixed at Rs.43.95 per sq.ft per month of the chargeable area of 32,400 sq.ft for the first three years of the lease / term of 12 years subject to an increase of rent by 12% of the last paid rent after expiry of first three years and thereafter, 15% after end of every term of three years. The other charges were payable by the lessee, i.e. respondent company.
4. The case of the petitioner in Para 9 of the petition is that respondent company failed to pay the following dues:
"9. The petitioner submits that the respondent company was occupying the Leased Premises of the petitioner in the terms of the said Lease Agreements and operated its store in the name of Spencer's at Jaipur. However, the respondent company has failed to make the following payments in respect of Lease Rentals and various charges mentioned in Para 7 hereinabove despite repeated reminders though the same has already become overdue.
Sl. No.
Particulars
Period for which outstanding
Amount
1.
Lease Rentals
May 2009 to Aug. 2009 56,95,920.00 2.
AC Charges Apr.2009 to Aug.2009 14,88,455.00 3.
Electricity Charges
July 2009 to Aug.2009
2,65,844.00
4.
CAM Charges
Apr.2009 to Aug.2009
14,88,455.00
5.
Security Deposit against Service tax on Lease Rentals
Nov.2008 to Aug.2009
16,50,873.00
6.
Sinking Fund Charges along with service tax
May 2009 to Aug.2009 2,83,230.00 7.
Display Charges (Balance Amount of Invoice dated 01.10.08) 28,169.00
Total 1,09,00,946.00
5. The case set up in the petition is that lease was for a term of 12 years, but lock-in period of the lease was 36 months, before which the lease could not be terminated by any of the parties. After 36 months, the lessee, i.e., respondent Company was competent to terminate the lease by giving a prior notice of 6 months, whereas, there were no such right with the petitioner except in the event of default.
6. The case set up by the petitioner further is that in violation of terms of the lease agreement, the respondent company sent a pre-mature termination notice to the petitioner and vacated the Leased Premises on 02.09.2009, without payment of lease rentals for the contractual lock-in period and notice period of 6 months from the rent commencement date.
7. On the pleading referred to above, it is claimed that the respondent company is indebted to the petitioner to a sum of Rs.2,96,76,616.00 (Rupees Two Crores Ninety Six Lakhs Seventy Six Thousand Six Hundred Sixteen only).
8. It is pleaded in the petition that statutory notice was sent to the respondent, calling it to clear the dues, but no reply was received to the notice.
9. This fact is disputed by the learned Senior Counsel for the respondent by stating that reply was sent to the notice. One of the contentions raised by the respondent is that the petitioner has misled the Court by making false averments, therefore, not entitled to the relief under Section 433, 434 r/w 439, having not come to the Court with clean hand.
10. Counter has been filed by the respondent company, wherein, stand taken is that the respondent company is solvent company, being one of India's largest and fastest growing multi-formate retailer with 220 stores including 30 large format stores across 35 cities in India. This itself shows that the respondent company is a solvent company, and that the amount claimed by the petitioner company is b
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