9911796707
TMI Blog2012 (12) TMI 771X X X X Extracts X X X X X X X X Extracts X X X X ..... on recommendations by BIFR by order dated 24.01.2001. There was some litigation in the form of Company Petition No.301 of 2001, wherein an order was passed allowing renewal of the lease period in respect of the leased property to STTL (Sonria Technical Textiles Ltd.) and also ordered that it will be open for the lessee to purchase the same, but not at the price lower than the market price. 2.2 One shareholder named Mr. Balkrishna Thakkar filed OJ Appeal No.43 of 2005 challenging order dated 14.06.2005 passed in Company Application No.310 of 2005. The said shareholder (Mr. Balkrishna Thakkar) also filed OJ Civil Application No.217 of 2005 in OJ Appeal No.43 of 2005 and prayed for stay of auction proceedings for the sale of the said property which was to take place before the Company Court. The Division Bench of this Court passed an order in OJ Civil Application No.217 of 2005 in OJ Appeal No.43 of 2005 and granted ad interim stay against auction proceedings of the Kalol property pending before the Hon'ble Company Court. The relief granted by the Division Bench was in terms of para-10-A, which reads as under:- "10 vA. pending the admission hearing and final disposal of the present ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ser shall be at the liberty to submit the draft Sale Deed to the OL after deposit of 25% of the sale consideration and the OL shall execute the Sale Deed after its approval by this Court." 2.6 It is not in dispute that 25% amount which was to be paid on or before 10.03.2006 was paid by the present appellant-applicant and as per the period prescribed by the order, the last date for payment was 09.06.2006. As the appellant-applicant could not pay remaining amount, it filed Company Application No. 327 of 2006 and prayed for extension In this regard, it will be relevant for our purpose to consider the exact prayer made in this Company Application. The prayer is in Judges Summons-para-(a), which reads as under:- "(a) That the delay in making payment of the balance purchase consideration amount be condoned and the period for making payment of the balance purchase consideration amount be extended up to and inclusive of 31st of August, 2006." (emphasis supplied) 2.7 This Judges' Summons is dated 22.06.2006. In the affidavit in support of Judges' Summons also, it is mentioned that:- "(1) .......... Of the total purchase consideration of Rs.10.20 crores the Applicant was required ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... adjustment to the EMD amount, the demand draft dtd.26.07.2006 of Rs.1 Crore drawn in favour of Official Liquidator Mahindra Mills, is ready and to be paid accordingly and the balance amount will be paid on or before 31st August, 2006 with a request to fix the interest at 9%. However, since the UCO bank, respondent no.6 herein is not served, Fresh Notice qua respondent no. 6 only, returnable on 08.08.2006. Direct Service permitted. The draft of Rs. 1 crore is handed over to the Official Liquidator." 2.10 After the aforesaid order was passed, another order came to be passed on 18.08.2006, which reads as under:- "Mr. A.L. Shah, learned counsel for the applicant, has handed over a cheque for Rs. 1 crore dated 17.8.2006 drawn in favour of the Official Liquidator for Mahendra Mills Limited, which is ordered to be kept with the Official Liquidator. He has also requested that time limit for making remaining payment may be extended upto 15th September 2006 in view of the flood-situation prevailing in the State. Time to make the remaining outstanding dues is extended upto 15.9.2006. S.O. To 30.8.2006." 2.11 On perusal of the aforesaid two orders, it is clear that the Court granted extens ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion came to be allowed by order dated 14.07.2009 and the applicant (Anjana Constructions) was permitted to intervene in the appeal. Being aggrieved by order dated 14.07.2009, the present applicant-appellant approached the Hon'ble the Apex Court by filing Special Leave to Appeal (Civil) No.5415 of 2010. This Special Leave to Appeal came to be disposed of by the Hon'ble the Apex Court by order dated 28.04.2011. The Hon'ble the Apex Court was pleased to observe as under:- "We do not see as to how the applicant before the Division Bench could be aggrieved by such an order and, accordingly, we are not inclined to interfere with the same in the special leave petition. However, the subject matter of the case relates to the auction of certain properties in a winding up proceeding through the Official Liquidator. The petitioner's bid which was initially accepted by the learned Company Judge, was subsequently rejected on account of the fact that the petitioner was unable to put in the balance sale price, as directed by the Court. It is against the said order that the appeal" was preferred by the petitioner herein before the Division Bench and the same is pending. By virtue of an interim or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge was required to consider the said report and issue suitable direction in accordance with law. 2.16 It is against this order that the appellant-applicant approached Hon'ble the Apex Court by filing Special Leave to Appeal (Civil) No.27544 of 2011. The said Special Leave to Appeal came to be disposed of by the Hon'ble the Apex Court by order dated 17.10.2011. A short order, which is reproduced for ready perusal:- "On a conjoint reading of Paragraph 3 of the impugned judgment with the Order at Page 32 of the Special Leave Petition (Annexure-P/1) dated 22nd February, 2006, we grant leave to the petitioner to move the High Court for review. Subject to what is stated above, we permit the petitioner to withdraw this petition. The Special Leave Petition is, accordingly, dismissed as withdrawn. (emphasis supplied) 2.17 After disposal of the Special Leave to Appeal by way of withdrawal, the appellant-applicant approached this Court and filed review application being Misc. Civil Application No.35 of 2012. Learned Advocate for the appellant-applicant submitted that as there was delay, Civil Application for condonation of delay was also filed, which was allowed and the Misc. Civil Appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aforesaid order, in so many words, gives right to the present appellant-applicant to raise contention at the time of hearing of OJ Appeal No.146 of 2008. In this regard, he laid emphasis on the following words:- "17 (a)........... that such reviewing and recalling of the order shall not automatically put an end to the rights of the parties for the action taken pursuant to the order dated 20.6.2011 and thereafter." 3.1 Learned Advocate for the appellant-applicant submitted that the Court, while recalling order dated 20.06.2011, was very clear in its mind and therefore provided that, 'by review or recall of the said order (20.06.2011), rights of the parties will not come to an end'. Learned Advocate for the appellant-applicant submitted that meaning thereby the right of the applicant to have the property on such terms and conditions as may be prescribed by this Court at the time of hearing and deciding of OJ Appeal No.146 of 2006 is available to the applicant under this order. Learned Advocate for the appellant-applicant-submitted that, that is why the Court further stated that:- "17. (a) It will be open to the parties to the proceedings as well as to the third party, if any, to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned Company Judge was further pleased to order that: "30. So far as the relief prayed for in para 24(2) is concerned it is clarified that the request for permission to auction sale the land and property in question can be considered only after the valuation of the land and property in question is made available before the Court." 4.2 Besides Official Liquidator's Report No.114 of 2011, the Official Liquidator also filed Official Liquidator's Report No.116 of 2011 before the Hon'ble Company Court for fixation of upset price and to fix the date of auction. The Official Liquidator suggested the upset price to be Rs. 50 crores. The said Official Liquidator's Report No.116 of 2011 was filed on 05.07.2011 and on that Official Liquidator's Report, the learned Company Judge passed order on 04.10.2011, giving certain directions, which are as under:- "14.1 It is clarified that the below mentioned directions and present order are passed with a view to ensuring that the process of getting fresh valuation and subsequent process for disposed of property may not be delayed, more particularly, because on earlier occasion, the Apex Court has desired that the proceedings pertaining to the proper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cts are set out to give an idea about the controversy involved in the matter. These facts were necessary to set out so as to make it clear that the Court was aware of the controversy involved in the matter. As such, a short question which falls for consideration of this Court is as to whether the appellant-applicant, in whose favour a sale came to be confirmed by order dated 22.02.2006 on certain terms and conditions as provided in the tender and as provided by the learned Company Judge in order dated 22.02.2006, having committed default, can now be heard to say that:- I. time to make payment of the remaining sale consideration be extended on such terms and conditions as may be deemed fit by this Court. The indication was that on payment of interest on such rates as deemed proper by this Court. II. Alternatively it was suggested that in the event the Court finds it not acceptable the aforesaid course of action then in that case, the applicant should be allowed to retain the portion /part of the property to the extent he was able to pay price and the remaining property may go back to the Official Liquidator, who may then deal with the property in accordance with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the Judges' Summons and the affidavit filed in support of the Judges' Summons that what was prayed was extension of time only up to 31.08.2006 and the reason set out for seeking such extension was in para-(3) of the affidavit, wherein it was stated that, "on account of serious sickness in the family of one of its active partners and also on account of other reasons beyond its control". This Court has an additional reason to deny the prayer /relief to the appellant-applicant because the prayer for extension of time stood granted in favour of the applicant as extension was granted up to 15.09.2006. It will not be inappropriate to remind oneself that extension sought for was only up to 31.08.2006, whereas the Court granted extension up to 15.09.2006 and therefore, on that short ground, the appellant-appellant must fail in getting any relief from this Court. 8.4 The submission made by learned Advocate for the appellant-applicant that he could not act within the period extended because there was OJ Appeal No.43 of 2005 pending and it was decided that Company Application No.327 of 2006 (praying for extension) will be considered after OJ Appeal No.43 of 2005 is decided, which came to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n order dated 23.08.2012 will be applicable to the following actions which have taken place between 20.06.2011 and 23.08.2012. I. Sale is terminated by order dated 29.07.2011 passed in Official Liquidator's Report No.114 of 2011. II. Forfeiture of the deposit is ordered. III. Fresh valuation of the property has taken place. IV. More than one Intervener have come forward to offer price, ranging between Rs.42 crores to Rs.50 crores for the same property, details of which are as under:- A. KBC Enterprise filed OJCA No.215 of 2011, offering price of Rs. 42 crores. B. Shree Ganesh Marketing Pvt. Ltd. filed OJCA No.273 of 2011, offering price of Rs.45 crores. C. Anajana Construction filed OJCA No.205 of 2009, offering price of Rs. 45-50 crores. D. Kamla Amrut Infrastructure filed OJCA No.282 of 2011, offering price of Rs. 48 crores. 9.1 Learned Advocate for the secured creditors vehemently submitted that it is a settled position of law that 'Company Court is a custodian of the property for the benefit of the workers and secured creditors'. He submitted that it is the prime duty of the Company Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... editors to set aside the sale. This may cause some inconvenience or loss to the highest bidder but that cannot be helped in view of the fact that such sales are conducted in Court precincts and not by a business house well versed with the market forces and price. Confirmation of the sale by a Court at grossly inadequate price, whether or not it is a consequence of any irregularity or fraud in the conduct of sale, could be set aside on the ground that it was not just and proper exercise of judicial discretion. In such cases, a meaningful intervention by the Court may prevent, to some extent, underbidding at the time of auction through Court. In the present case, the Court has reviewed its exercise of judicial discretion within a shortest time. (emphasis supplied) 9.2 Learned Advocate for the secured creditors also relied upon a decision of the Hon'ble the Apex Court in the matter of Shradhha Aromatics (P.) Ltd. v. Official Liquidator of Global Arya Industries Ltd. [2011] 108 SCL 1. Learned Advocate for the secured creditors invited attention of the Court to paras-2, 3 and 4 of the said judgment. Incidentally, the judgment in the case of Divya Manufacturing Company (P) Ltd. (supra) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eiture of only Earnest Money Deposit and not the entire sale consideration because simplicitor dismissal of this appeal may be construed to mean that the entire amount which is paid by the present appellant-applicant stands forfeited. He submitted that this request is required to be made because it is suggested by the learned Advocate for the Official Liquidator that the appellant-applicant is not entitled to refund of anything and if at all the amount is ordered to be refunded, it should be only after deducting interest @ 15% from the said amount. Learned Advocate for the appellant-applicant invited attention of the Court to the relevant discussion in para-18 of the said order, which reads as under:- "18. The terms of the tender including clause No.17, inter alia, prescribe that in the event the auction purchaser does not pay the balance amount of sale consideration, the OL shall terminate the sale and forfeit the deposit. There is no dispute between the parties that the term "deposit" in clause No.17 and para 6(4) of the order dated 22.2.2006 means Earnest Money Deposit (EMD) paid by the bidders at the time of tendering the bids." 14. This Court, after careful consideration, di ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
