2012 (4) TMI 837 - HC - Companies Law

Summary

Issues:
1. Confirmation of sale of property of a company-in-liquidation.
2. Rejection of bid and sale of properties in bits for maximum proceeds.
3. Deferral of proceedings pending disposal of a writ petition challenging auctioning of assets.

Analysis:

Issue 1: Confirmation of Sale
The judgment involves the confirmation of the sale of assets of a company-in-liquidation to M/s. Godha Realtors (India) Private Ltd. The sale process involved multiple bidders, with Godha Realtors making the highest bid of Rs. 45,90,00,000. The Court considered the valuation report and found the offer to be higher than the valuation, declaring Godha Realtors as the successful bidder. The Official Liquidator sought confirmation of the sale, which was granted by the Court.

Issue 2: Rejection of Bid and Sale in Bits
An application was filed by a shareholder of the company-in-liquidation, requesting the rejection of the bid at Rs. 35,00,00,000 and advocating for the sale of properties in bits to maximize proceeds. The applicant argued that the land's value was higher than the offered amount and suggested selling the land in parts for a higher value. However, the Court found the arguments unsubstantiated, noting the lack of concrete evidence or alternative valuation reports to support the claim. The Court emphasized the transparent auction process and the absence of objections from relevant parties regarding the valuation.

Issue 3: Deferral of Proceedings
Another application was filed by a sugar company, unrelated to the debts of the company-in-liquidation, seeking to defer confirmation of the sale. The applicant feared the revival of the company-in-liquidation as a sugar factory would impact its business interests. The Court dismissed this application, highlighting that the sale process followed legal procedures under the Companies Act. The Court emphasized the statutory duties of the Official Liquidator and the importance of timely confirmation to prevent asset deterioration.

In conclusion, the Court dismissed the applications seeking to reject the bid, sell properties in bits, and defer confirmation of the sale. The sale to Godha Realtors was confirmed, and the Official Liquidator was permitted to hand over possession of the property to the purchaser. The judgment underscores the importance of following legal procedures in asset sales of companies-in-liquidation and prioritizing timely confirmation to prevent asset devaluation.