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TMI Blog2010 (6) TMI 328X X X X Extracts X X X X X X X X Extracts X X X X ..... al Liquidator to immediately take step for sale of the assets. - APO NO. 330 OF 2007 ACO NO. 30 OF 2008, 60 OF 2009 CA NO. 580 OF 2002 AND CP NO. 519 OF 1989 - - - Dated:- 14-6-2010 - BHASKAR BHATTACHARYA AND PRASENJIT MANDAL, JJ. Ratnako Banerjee, Manju Bhuteria Jaydip Kar, Ravi Kapoor and Nilay Sengupta for the Petitioner. D.N. Sharma, Jishnu Saha, Ashis Mukherjee, Utpal Bose, M.C. Ghosh and Ranjan Bachwat for the Respondent. JUDGMENT Bhaskar Bhattacharya, J. - This appeal is at the instance of an unsuccessful applicant under section 466 of the Companies Act (the Act) and is directed against an order dated 2-12-2005, passed by a learned Single Judge thereby dismissing the said application. 2. The facts giving rise to filing of the present appeal may be summed up thus : (1)The company-in-liquidation was incorporated in the year 1985 and had gone into liquidation on the 4-6-1990. During the said period, it took loan from Allahabad Bank for the recovery of which the bank instituted a suit which ended in a decree for a sum of Rs. 3,47,04,232.85 together with interest at the rate of 12 per cent per annum. The said decree gave time of 60 days to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant to file a fresh application. The fourth application was filed by the appellant but the same was dismissed as there was no definite proposal for investment by the appellant for revival of the company. (4)While dismissing the fourth application mentioned above, the learned Single Judge gave liberty to the appellant to file a fresh application disclosing, (1) the entire liability of the company-in-liquidation, (2) amount of investment the appellant proposed to make, (3) viability statement, (4) projected balance sheet to consider the proposal of the appellant with regard to the repayment of liabilities. (5)Pursuant to such liberty given by the learned Single Judge, another application was filed by the appellant out of which the present appeal arises. 3. The learned Single Judge, as it appears from the order impugned; dismissed the application principally for the following reasons : (1)No provision was made in the scheme in respect of the source of money from which the appellant would be in a position to pay the dues of the bank. (2)Although the appellant had not disclosed the source of making payment of Rs. 95 lakh in the scheme, it appeared that such scheme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en put forward by the said Sylvan. According to Mr. Banerjee, Sylvan is a company which had proposed an earlier scheme for revival of the company in 1996-97. The only motive of Sylvan was and still is to grab the factory land of the company having an area of approximately 37 acres situated at Rishra, District Hooghly. Mr. Banerjee submits that, on the basis of an order passed by this court, Sylvan obtained possession of the entire undertaking of the company from the official liquidator and, in the garb of cleaning the factory of the company, it has wrongfully and illegally removed the entire plant and machineries of the company. The possession of the factory land of the company was restored to the official liquidator after the order sanctioning the earlier scheme was set aside by a Division Bench of this Hon ble Court and dismissal of the special leave petition from the order of the Division Bench. 8. Mr. Banerjee contends that the appellant has made the application being Company Application No. 580 of 2002 for the purpose of stay of the winding-up proceeding, inter alia, under section 466 of the Companies Act, 1956. According to Mr. Banerjee, the appellant, as a contributory ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the dues and to revive the company. 11. According to Mr. Banerjee, the Deccan as an assignee of Allahabad Bank cannot claim any right which is contrary to the memorandum of understanding of 17-10-2002. Deccan is bound by the terms of the memorandum of understanding of 17-10-2002 as Deccan claimed to have stepped into the shoes of Allahabad Bank. 12. Mr. Banerjee further contends that the deed of assignment from Allahabad Bank to Deccan is illegal and bad for the following reasons : ( i )The memorandum of understanding between Allahabad Bank and ARC was entered into on 17-10-2002, and the clauses 4 and 5 of memorandum of understanding recognize that time may be extended for obtaining sanction of the scheme. At the time of rejection of the application of ARC on 2-12-2005, the Allahabad Bank had supported the appellant which implies that the memorandum of understanding was extended beyond the period of four months from 17-10-2002; ( ii )The appeal was preferred on 8-2-2006. During the pendency of appeal, according to Allahabad Bank, there was termination on 3-5-2007, and assignment on 2-8-2007. The appeal was admitted on 17-7-2007, but bank did not mention anything about ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agreeing to accept Rs. 3.80 crore in full and final satisfaction of its claim. Moreover, the order dated 26-9-2000, of Supreme Court did not contemplate the situation of any scheme proposed by the appellant for revival of the company on the basis of the memorandum of understanding of 17-10-2002. Mr. Banerjee, therefore, prays for setting aside the order impugned and allowing the application filed by his client. 14. Mr. Kar, the learned advocate appearing on behalf of the respondent No. 8 and Mr. Saha, the learned advocate appearing on behalf of the respondent No. 10, have opposed the contentions of Mr. Banerjee. The learned advocates appearing on behalf of the respondent Nos. 4 to 7 have opposed the appellant while some of the members of the respondent Nos. 5 and 6 have supported the appellant. The only question that arises for determination in this appeal is whether the learned Single Judge was justified in rejecting the prayer of the alleged revival of the activities of the company-in-liquidation on the basis of the materials on record. 15. At this stage it would be apposite to refer to the following observations of the Supreme Court in the case of Meghal Homes (P.) Ltd. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... failed, industrial undertaking of the company was not viable. Moreover, the plant and machinery of the company having been stolen, it is admitted in the scheme that commence-ment of manufacturing activities would entail massive capital investment, and there is no prospect of any person making such investment. It is stated therein that as the factory of the company is spread over 37 acres of land, the said land can be conveniently used for carrying on real estate business and it was therefore proposed to revive and rehabilitate the company by carrying on real estate business subject to the sanction of the company court. 18. It is indicated in the scheme that the Allahabad Bank is the only secured creditor of the company and an agreement has been entered into with the said bank for repayment of its dues. The number and particulars of unsecured creditors has not been indicated in the scheme, although on last occasion, similar application was dismissed by the Company Court on that ground with liberty to file fresh application disclosing the particulars of such unsecured creditors. In the scheme, there is no proposal of re-employment of any of the employees of the company but the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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