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TMI Blog2012 (1) TMI 378X X X X Extracts X X X X X X X X Extracts X X X X ..... t, 1956; (b) If the prayer above is in affirmative, whether this Hon'ble Court may bepleased to direct the purchaser viz. M/s. Ajanta Pharma Ltd to hand over the said properties to the Official Liquidator; (c) If this Hon'ble Court upholds that the sale is valid, whether this Hon'bleCourt would be pleased to direct the secured creditors viz Allahabad Bank, Bank of India Mutual Fund, SICOM and MSFC to furnish an undertaking that they would bring back the money taken by them alongwith accrued interest so as to enable the Official Liquidator to declare dividend to the workers in terms of the provisions of section 529A of the Companies Act, 1956. 2. In the company application, the purchaser M/s. Ajanta Pharma Limited has prayed for declaration that the Agreement for Sale dated 7th July 2009 between it and the company in liquidation be declared valid, binding and subsisting and the sale be thus approved. It is the case of the said M/s. Ajanta Pharma Ltd that Mayo (India) Ltd was a company which was engaged in the activity of manufacture, sale and distribution of various pharmaceuticals preparations. Wexford Trading Company Pvt Ltd and Arogya Pharma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 30th May 2008 which was published on 31st May 2008 in the local newspaper Lokmat having wide circulation in Chitegaon, Aurangabad. Public Notice was given of the intention of the respondent and its sister companies to sell to the applicant the said property. Therefore, with effect from 31st May 2008, a notice was given to the world at large about the said sale. 8 . It is stated that the total consideration paid is ₹ 3 crores 5 lakhs. Certain payments have been made by the applicants directly to the banks and they have obtained the No Dues Certificate which were relied upon. The attempt is to demonstrate as to how the dues of the secured creditors of the company in liquidation have been cleared from the sale proceeds or otherwise, by the applicant. Further, it has been stated that before the transaction was concluded, the applicant has verified that the dues of the workmen have been settled. Prior to the execution of the Sale Deed, valuers had been appointed by the applicant to value the building and plant and machinery. After all these steps were taken, on 7th July 2009 a Sale Deed was executed between the respondent and its sister companies as the vendors and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oid. 10. In para 7 of this affidavit, this is what is stated: 7 With reference to paragraph Nos. 4 to 6 of the said affidavit, I say and submit that the above petition was filed on or about 10/09/1999. The above company petition was admitted by this Hon'ble Court on 09/02/2000 and the above petition was published in newspaper Janmabhoomi on 11/03/2000 and in Free Press Journal on 10/03/2000. The said company thereafter made a Reference to BIFR and the same was registered as Case No. 356 of 2000. By order dated 20/09/2001, the said Reference No. 356 of 2000 filed by the said company was rejected by the BIFR. It appears that thereafter the said company filed an appeal before AAIFR and the reference was remanded back for hearing to the BIFR. By order dated 09/06/2003, the BIFR held that the said company is systematically siphoned away the funds through transactions which could not be explained nor supporting documents/vouchers produced to the satisfaction of the SIA (Special Investigative Audit) and once again rejected the Reference as not maintainable. The said company thereafter filed another Reference being Case No. 32 of 2002 before the BIFR and the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . For all these reasons, it is prayed that this application be dismissed. 13. Together with this application, there is a report of the Official Liquidator in which the prayer is that the earlier report was placed before this Court and one Ex-Director of the company in liquidation Mr. S.S. Agarwal appeared and sought time. Thereafter, he filed an affidavit stating that two assets mentioned in the report of the Official Liquidator, namely. Gat No. 12 and Gat No. 14 of village Chitegaon, Taluka Paithan, District Aurangabad, owned and possessed by M/s. Mayo Health Care Pvt Ltd, now known as M/s. Mayo (India) Ltd with factory building and plant and machinery have been sold by a Registered Deed of Sale dated 7th July 2009 to the applicant M/s. Ajanta Pharma Ltd. These lands were mortgaged with secured creditors whose names are listed in Official Liquidator's report dated 25th January 2011. They stated that each of these secured creditors claims have been settled. Further it was stated that there is one more secured creditor M/s. Saraswat Co-operative Bank Ltd but Official Liquidator is not aware whether their claim is paid or not. 14. The contention of the Official ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iginal petitioner. 18. After hearing all parties, in my view, the legal position is in no doubt. The principles are summarised in several decisions of this Court and the Hon'ble Supreme Court. The principle is that bonafide transaction for a consideration can be protected. The power under section 536(2) enables this Court to make appropriate orders. The Court has held that the said jurisdiction and power is discretionary and equitable. Merely because winding up process has started does not mean that such transaction should be declared as void but the Court can in appropriate cases protect and save bonafide transactions. The reliance placed on the decisions in that regard is, therefore, appropriate. The Hon'ble Supreme Court has held that if the transaction resulting in disposition of company's property during the interrugum, namely, between presentation of petition for winding up and passing of order for winding up if declared null and void, would paralyse the business of the company, then, the Court has ample discretion not to invalidate it. The company may have to deal with their property for day to day transactions, make payment of salary to the sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statutory dues, for settling the claims of the workers/office staff and making payment to unsecured creditors. Thereafter, on 7th July 2009, this Sale Deed was executed. On 7th July 2010, the winding up order was passed. 19. Each of these events are sought to be proved by producing relevant documents including the correspondence. True it is that the Court can validate transactions which are not entered into ordinary course of the current business, however, to my mind the broad proposition or tests, in addition to what have been already referred by me is not necessary to be referred or considered. 20. Once the transaction is found to be for the benefit of and in the interest of the company or for keeping the company going generally, then, the Court can exercise the discretion. 21. In the present facts and circumstances, when the report of the Official Liquidator was presented, even in the month of November 2010 and now in the month of January 2012 what transpires is that not only the Sale Deed has been executed but the applicant has started commercial production. Mr. Madon, learned senior counsel states that the applicant had inserted an advertisement in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e property is not belonging just to company in liquidation but other entities as well. Even the copy of the Memorandum of Understanding has been annexed to the affidavits. The charge on the properties has been noted as satisfied even in the records of the Government of India, Ministry of Corporate Affairs. Pertinently, there is a letter dated 5th March 2008 issued by the original petitioner MSFC, Aurangabad stating that the Corporation has sanctioned and disbursed term loan of ₹ 40 lakhs to the company in liquidation on 28th June 1988. It is stated that there is no dues to be recovered from the company in liquidation from Loan Account No. M-00941. It may be that the MSFC has filed an affidavit and has sought to disown this communication but what is apparent is that the same is on the letter-head of the company. If at all there is a fraud played on the MSFC and the certificate has been obtained, the MSFC could have initiated legal proceedings and particularly when it is alleged that its claim is not disputed by the company and duly reflected in the balance sheet filed before BIFR. The applicant has been asserting that the dues of the MSFC have also been cleared and is relying ..... X X X X Extracts X X X X X X X X Extracts X X X X
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