Sc Upholds Order Against Cox & Kings Eviction

The Supreme Court yesterday confirmed the Delhi high court order of eviction against Cox & Kings Ltd, noting that the foreign company had sublet the premises to the Indian company without the permission of the landlady.

Under the Rent Control Act, the tenant shall not sublet, assign or otherwise part with the possession of the whole or any part of the premises, without obtaining the written consent of the landlord. The UK company had applied for permission to carry on business after the FERA came into force, but it was denied by the Reserve Bank of India.

Later, the Indian company was floated, in which the foreign company had only 40 per cent stake as permission for 100 per cent was denied. The Indian company began carrying on business in the same premises. The company argued that the transfer of leasehold was by compulsion and involuntary, and it was not a case of subletting.

 

Rejecting the argument, the division bench consisting of Justice K Ramaswamy, Justice S B Majumdar and Justice G T Nanavati said that though it may not be strictly `subletting, it was nevertheless assignment under the contract between the two companies.

Assignments are also not permissible without the written consent of the landlord. This was not complied with in this case, the judgment pointed out.

According to the Supreme Court, even after amalgamation of two companies, the new company cannot continue in the premises of the old one without the landlords consent.