CAV JUDGMENT

(PER: HON'BLE MR. JUSTICE D K SINGH)

1. The present appeal has been filed by the appellant- the Official Liquidator of the Mysore Kirloskar Ltd., (the Company in liquidation) being aggrieved by the impugned order dated 21.07.2015 passed by the learned Company Court in Company Application No.826/2011 in Company Petition No.166/2001.

2. The Company Application No.826/2011 was filed by the appellant herein seeking a declaration from the Company Court to declare the Lease Agreement dated 22.01.2000 executed between the Mysore Kirloskar Limited., and the respondent as void against the Official Liquidator and for consequential cancellation of the lease agreement. The learned Company Court vide impugned order dated 21.07.2015 has dismissed the application in CA No.826/ 2011.

3. The relevant facts for the purposes of decision in the present appeal are stated as under:

i. The respondent is a Society registered under the Karnataka Registration of Societies Act, 1960 under the name "Kirloskar Institute of Advanced Management Studies" now named as "Kirloskar Institute of Management Studies" ;

ii. The respondent entered into a registered lease agreement dated 22.01.2000 with M/s. Mysore Kirloskar Ltd., (the Company in liquidation). Pursuant to the aforesaid lease deed, respondent was put in possession of the land bearing Survey No.22, a part of Survey No.23 and a part of Survey No.27 in Harihara Village and Taluka, Karnataka.

iii. Since its execution, respondent has been paying the paltry rent of Rs.1,250/- per month. The Company Court vide order dated 01.04.2004 ordered for winding up of Mysore Kirloskar Limited, pursuant to the petitioner in Company Petition No.166/2001. On 29.07.2011, the Official Liquidator filed an application in Company Application No.826/2011, seeking to declare the lease deed as void against the Official Liquidator as it was executed a few days prior to the presentation of the Company Petition before the Company Court, which was on 14.03.2000.

iv. The Company Court after hearing the parties in Company Application No.826/2011 has dismissed the application vide impugned judgment and order dated 21.07.2015, on the ground that the Company Application was barred by Limitation.

BACKGROUND OF THE CASE:

4. The Mysore Kirloskar Limited was ordered to be wound up by the Company Court vide order dated 01.04.2004 in Company Petition No.166/2001 and the Official Liquidator attached to this Court was appointed as Liquidator of the Company (in liquidation) by virtue of provisions of Section 449 of the Companies Act, 1956.

5. Consequences of the winding up in respect of the assets and properties of the Company in Liquidation are provided in Section 456 of the Companies Act. Section 456(1) of the Companies Act provides as under:-

"'Where a winding up order has been made or where a provisional liquidator has been appointed, the liquidator or the provisional liquidator as the case may be, shall take into his custody or under his control, all the properties, effects and the actionable claims to which the Company is or appears to be entitled."

6. Further Section 456(2) provides "All the properties and effects of the Company shall be deemed to be in the custody of the Tribunal as from the date of the order for the winding up of the company". Accordingly, the official liquidator had taken possession of the company's land ad measuring 176 acres, buildings, plants and machineries, fixtures and movable assets, residential quarters and sites etc., situated at Yantrapura, Harihara, Davangere District. Subsequently with the permission of this Court the Official Liquidator had sold the undisputed properties.

7. With the permission of this Court, the Official Liquidator invited claims from the creditors of the Company (Company in liquidation) and distributed dividend to an amount of Rs.89,70,74,758/- as first dividend and Rs.17,67,59,066/- as the second dividend to the secured creditors and workmen of the Company in liquidation. Put together 95%