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TMI Blog2003 (2) TMI 339X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner were paid Rs.9,37,151.41 only. Because of delay in the disbursement and inadequacy thereof, the petitioner could not purchase all the machineries required for upgrading the press. The entire project, therefore, remained a non-starter. Even then, the petitioners repaid Rs. 6,91,113.32 out of which Rs. 7,21,936.80 was adjusted against interest and Rs. 2,39,171.52 against principal. In the month of June, 1999, the AFC served a copy of the notice under section 29 of the Act of 1951 for taking over the management reserving right to transfer the mortgaged property by way of sale or lease. 2. The petitioner challenged the aforesaid notice in W.P. (C) No. 3180 of 1999. The Court while issuing Rule by the order dated 28-6-1999 direct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ording to the respondents, notices were issued repeatedly calling upon the petitioner Firm to liquidate the entire amount, particularly in terms of the order dated 28-6-1999 passed in W.P. (C) No. 3180/99. The petitioner firm issued a post dated cheque of Rs. 1 lakh only which was eventually dishonoured by the bank. The Corporation invoked the powers under section 29 of the Act of 1951 as a last resort and published the said notice in a widely circulated Assamese daily. The publication was restricted to only one newspaper due to financial constraints. The process of sale though made known to the petitioners, they took no steps to produce any better purchaser. Eventually, the deal was stuck at Rs. 57 lakhs with Dr. Saikia and a sum of Rs. 9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... premium to a dishonest borrower. 6. In the instant case, there appears to be no infringement of the statutory provisions. The Corporation has unshackled powers to realize the outstanding loan amount by selling mortgaged property through public auction. Therefore, the decision in Mahesh Chandra s case ( supra ) that every endeavour should be made to make the unit viable and vibrating is not the mandate of law as on today. The submission advanced in this behalf by Mr. Mazumdar, learned Senior Counsel is of no significance. In this context, it can be said that private negotiation for sale of the mortgaged property would be permissible only when the Corporation fails to secure the best price through public auction. Therefore, the first op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eep in view while dealing with disposal of seized units." (p. 507) 7. The aforesaid decision requires the Corporation to give wide publicity of the public auction to ensure maximum public participation in the process of sale. This has to be meticulously followed to ensure fair play while enforcing Corporation s right to realize the amount in default. In paragraph - 10 of the said judgment, the Supreme Court held that the obligation to act fairly on the part of the administrative authority was evolved to ensure the rule of law and to prevent failure of justice. This doctrine being complementary to the principles of natural justice is bound to be observed by the quasi-judicial authority. Therefore, there cannot be any reservation that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed in an arbitrary manner. Discretion to sell the property in all situations will have to be exercised within the bounds of legal dicta. 10. It would appear that the decision to sell the property at a price of Rs.57 lakhs to Dr. Saikia has been taken by the Corporation after negotiation. Dr. Saikia was a bidder in the auction process and raised his bid to Rs. 57 lakhs for 14 kathas of land. The Corporation has not disclosed the number of purchasers who had submitted quotations in response to the public notice. Even the bid amount offered by Dr. Saikia was also not upto the satisfaction of the Corporation for which they had resorted to negotiation with him. All these are indicative of failure on the part of the Corporation to be fair in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e which is marred by the infringement of the doctrine of fair play ushering failure of justice. 12. It was argued by Mr. Sarma, learned Senior Counsel that the petitioners are not entitled to any relief as they failed to implead Dr. Saikia as respondent in this writ petition. With regard to Dr. Saikia s status in the matter, as already discussed hereinbefore, he was a participant in the public auction, but his bid was not reasonable and, therefore, it was not accepted by the Corporation. Thereafter, the Corporation negotiated the matter with Dr. Saikia who in turn raised his offer to Rs. 57 lakhs. It rather became more or less a settlement by private negotiation between the Corporation and the intending purchaser. The negotiation arrive ..... X X X X Extracts X X X X X X X X Extracts X X X X
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