SC upholds Bombay HC order, directs MSEB Holding Co’s eviction from HSBC building

Resolving a longstanding landlord-tenant dispute between Hongkong & Shanghai Banking Corp and the MSEB Holding Co, the Supreme Court has refused to interfere with a Bombay High Court order that directed eviction of the latter from the two floors of the bank’s building in Mumbai.

The apex court, however, gave MSEB and Maharashtra State Distribution Co time till December 31 to vacate the premises and give its peaceful possession to the bank.

A Bench led Justice Dipankar Datta while dismissing the appeal gave liberty to MSEB to vacate and give possession of the premises to Hongkong & Shanghai Banking Corp by December 31, 2025, upon filing of a requisite undertaking by April 17 for the same. “In default of filing of the requisite undertakings by the stipulated date, the protection granted by this order shall stand revoked and Hongkong & Shanghai Banking Corp. shall be free to initiate proceedings for execution of their eviction suit,” the apex court said.


The HC while reversing the decree of dismissal of the eviction suit had held that MSEB, not the State of Maharashtra, was the tenant of the disputed premises, rejecting the former’s stand of statutory tenancy or implied tenancy of the state government. While ordering the electricity companies to handover the possession, the HC had also directed separate enquiry to be conducted for calculation of mesne profits from the date of termination of tenancy.

The dispute pertains to a leasehold property originally demised by the predecessor of HSBC, namely Mercantile Bank Ltd, to the then governor of Bombay through lease deeds in 1953. The Maharashtra State Electricity Board, on behalf of the governor, had occupied the premises from 1954 and paid rent accordingly.

In 1965, the statutory rights of the governor of Bombay in respect of the premises got vested in the state of Maharashtra, implying that the latter stepped into the rights of the governor. Maharashtra State Electricity Board continued to occupy the premises and pay rent to Hongkong & Shanghai Banking Corp.

Thereafter, HSBC issued termination notices in 1992, 1998, and 2000, which were contested by Maharashtra State Electricity Board. In the meantime, the Maharashtra State Electricity Reforms Transfer Scheme in 2005 transferred all properties, rights, and liabilities vested in the electricity board to the state government, which was further revested to the four companies namely, Maharashtra State Electricity Distribution Co, Maharashtra State Power Generation Co, Maharashtra State Transmission Co and MSEB Holding Co.

Subsequently, HSBC filed an eviction suit in the Small Causes Court, Mumbai, seeking possession of the premises, The court had ruled against eviction.