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TMI Blog2004 (10) TMI 326X X X X Extracts X X X X X X X X Extracts X X X X ..... ation, the applicant might have the obligation to account for the profits. Certainly, while rendering the main judgment, this Court was conscious of all these aspects while ordering refund only of the purchase price deposited without providing for payment of interest to the purchaser but at the same time leaving it open to the purchaser to work out its claim for the expenses incurred by it before the company court. - CIVIL APPEAL NOS. 4191-4193 OF 1991 AND I.A. NOS. 9, 11, 13, 14 AND 15 OF 1991 - - - Dated:- 7-10-2004 - R.C. LAHOTI AND G.P. MATHUR AND P.K. BALASUBRAMANYAN, JJ. Soli J. Sorabjee, Ranjit Kumar, Dushyant A. Dave, R.P. Gupta, Sushendra Kumar Chauhan, Millan Mukherji, Rana Mukherjee, Suchit Mohanty, Siddharth Gautam, Goodwill Indeevar, Ms. Pragya Singh Baghel, Ms. Manik Karanjawala, Dhruv Mehta, Ms. Shalini Gupta, Mohit Chudhary, S.K. Mehta, A.D. Sikri, Ranjan Mukherjee, M.T. George, Janaranjan Das, Swetaketu Mishra, Ms. Moushumi Gahlot, Sinha Das, Tara Chandra Sharma, Ms. Neelam Sharma and Ashok Kumar Sil for the Appearing Parties. JUDGMENT P.K. Balasubramanyan, J. I.A. Nos. 9-11 in Civil Appeal Nos. 4191-4193 of 1991 These are applicatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the applicant herein prayed before this Court that the amount of Rs. 2 crores paid by it in instalments by way of purchase price, may be refunded to it and that it may also be repaid the sums which it had allegedly expended for the revival of the company. This Court, in the judgment, dealt with the claim of the applicant as follows : "Learned counsel for the second respondent submitted that the second respondent would be entitled to recover the sale price as also all expenditure that it had incurred consequent upon the order of sale. We are in no doubt that the Official Liquidator must refund to the second respondent the sum of Rs. 2 crores. As to any other expenditure, the second respondent must apply to the High Court and satisfy it, first, that it was incurred and, secondly, that in law, the second respondent is entitled to recover it. The appeals are allowed. The judgment and order under appeal is set aside as also the order of sale dated 15th September, 1989 in favour of the second respondent. The Official Liquidator shall forthwith recover possession, from whoever is in possession, of the assets and properties covered by the said order of sale. The same shall be reso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce the sale in its favour had been set aside. 7. The applications are opposed. It is submitted that the applications were not maintainable as what the applications really sought was not a clarification of the judgment but an additional relief or a relief which was not granted by this Court and which, in fact, has been denied or which should be deemed to have been denied. It is pointed out that the shockingly low purchase price was not even paid in a lump on 15-9-1989 from which date the interest was being claimed, but the same was paid only in four quarterly instalments and the claim for interest was untenable. It was further submitted that the applicant had the enjoyment of the assets valued at more than Rs. 16 crores for a period of 10 years and the applicant had not accounted for the profits for that period. It was pointed out that the claim that the company had made losses during the said 10 years other than for two years, was being seriously disputed. As a matter of fact, the applicant was liable to account for the profits earned from the properties during the period of 10 years it had been in possession. The applications were misconceived and were liable to be dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... years after the applicant was put in possession. Until then, the applicant had the enjoyment of the properties. 10. The Official Liquidator, in winding up proceedings by court, has the power to sell the immovable properties of the company wound up, under section 457(1)( c ) of the Companies Act, 1956. Rule 272 of the Companies (Court) Rules, 1959 provides that an Official Liquidator can sell the property belonging to the company only with the previous sanction of the court and that every sale shall be subject to confirmation by the Court. Rule 273 lays down the procedure for sale and rule 274 deals with the meeting of the expenses of the sale. Order XXI rule 93 of the Code of Civil Procedure (for short the Code ) provides that where a sale of immovable property is set aside under rule 92 of Order XXI, the purchaser shall be entitled to an order for repayment of his purchase money with or without interest as the court may direct, against any person to whom it has been paid. It has been held that even though Order XXI rule 93 of the Code may not ipso facto apply to a sale otherwise other than under the Code, the principle embodied therein can be applied to other sales to orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find that the obtaining of possession by the purchaser on deposit of the purchase price has considerable relevance, in deciding whether the purchaser would be entitled to interest on the purchase price as indicated by the decision of this Court in Union of India v. Official Liquidator H.C. of Calcutta [2000] 5 SCC 274. Therein, after referring to the decision in Motors Investment Ltd. s case ( supra ) relied on by counsel for the applicant and the direction for payment of interest made therein, this Court declined the award of interest on the distinction that, in that case, possession had passed to the purchaser. The Court stated that the judgment in Motors Investment Ltd. s case ( supra ) had no bearing mainly because as soon as the amount was deposited by the purchaser, possession of the property was handed over to him. No doubt the learned Judges thereafter, also referred to the decision in the present case and the non award of interest therein. But, in our view, that makes no difference, since the distinguishing feature relied on by the said decision, was the non-passing of possession to the purchaser. In this case, as we have noticed, the applicant, the purchaser, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... normally inquires into the adequacy of the consideration which the purchaser provides. But such an enquiry would be central to any defence solely based on a defence of change of possession, for, it is a defence which operates to discharge, wholly or in part, a defendant s duty to make restitution". Be it noted that the sale in favour of the applicant was set aside by this Court mainly on the ground that the consideration paid was grossly inadequate. 15. The upshot of the above discussion is that the prayer for clarification as made cannot be granted. The applications are liable to be dismissed. Hence, they are dismissed. I.A. Nos. 13, 14 and 15 in C.A. No. 4191 of 1991 16. I.A. No. 13/2004 is an application filed by the Bengal Paper Mill Mazdoor Union, the Labour Union of the wound up industry, for a clarification of the judgment dated 20-4-1999 by directing that the company in liquidation may be sold as a going concern. I.A. No. 14 of 2004 is by the same Union seeking permission to file a supplementary affidavit in support of its above prayer. I.A. No. 15 of 2004 is by the company which had made an offer for purchase of the assets of the company in liquidation "as is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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