2019 (1) TMI 871 - HC - Companies Law

Sale of movable and immovable property of the company in liquidation - possession of the immovable property to the auction purchaser - Held that - The Official Liquidator has prayed through this application that since the property is being sold @ ₹ 28,10,00,000/- after receiving the offers from the intending buyers and even after the inter-se bid and the creditors who are also arrayed as respondents No.1 to 5 have raised no objection in this regard, therefore, the sale in favour of the highest bidder be confirmed and he may be allowed to hand over possession of the immovable property to the auction purchaser after receipt of the balance sale proceeds as per terms and conditions of the sale and also to execute requisite document in favour of the successful bidder. After hearing the Official Liquidator and the counsel appearing on behalf of the secured creditors, the application deserves to be allowed because there is no allegation of any kind of malafide of process of bid from any quarter and the amount of bid is much more than the reserved price. Consequently, the application is hereby allowed and sale in favour of the highest bidder i.e. M/s Tynor Orthotics Pvt. Ltd. is hereby confirmed. Official Liquidator is also allowed to hand over the possession of the immovable property to the auction purchaser but after the receipt of the balance sale proceeds from it as per the applicable terms and conditions of the sale and also to execute the requisite documents in favour of auction purchaser. Since the auction purchaser is also present in Court and has submitted through its counsel that they would deposit the remaining balance amount with the Official Liquidator, the Official Liquidator is directed to complete the process within a period of 15 days from the receipt of certified copy of this order.

Summary

Issues: Application for exemption from filing certified copies of annexures and permission to confirm sale of movable and immovable property of a company in liquidation.

Exemption from Filing Certified Copies:
The first issue addressed in the judgment pertains to an application seeking exemption from filing certified copies of annexures A-1 to A-5 for permission to place on record photostat copies. The court allowed the application as prayed for, indicating a favorable outcome for the applicant in this regard.

Confirmation of Sale of Property:
The second issue discussed in the judgment involves an application filed by the Official Liquidator under Section 457(3) of the Companies Act, 1956, seeking permission to confirm the sale of movable and immovable property of a company in liquidation. The company in question, M/s Electronic System Punjab Ltd., was wound up by a court order, and the Official Liquidator attempted to sell its assets through various efforts. Despite initial unsuccessful attempts, subsequent efforts led to receiving bids from potential buyers. After inter se bidding, the highest bid was made by M/s Tynor Orthotics Pvt. Ltd. The Official Liquidator sought confirmation of the sale in favor of the highest bidder, as the bid amount exceeded the reserved price, and there were no objections from the creditors. The court, after hearing all parties, allowed the application, confirming the sale in favor of M/s Tynor Orthotics Pvt. Ltd. The Official Liquidator was directed to hand over possession of the immovable property to the auction purchaser upon receipt of the balance sale proceeds and to execute the necessary documents within 15 days from the receipt of the court order.

In conclusion, the judgment involved granting exemption from filing certified copies of annexures and confirming the sale of the company's property in liquidation to the highest bidder, M/s Tynor Orthotics Pvt. Ltd. The decision was based on the absence of any allegations of malafide processes and the bid amount exceeding the reserved price, with no objections from the creditors.