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Vishnu Kant Gupta v. Official Liquidator U.P. - SPECIAL APPEAL No. 232 of 2007 [2007] RD-AH 9726 (21 May 2007)


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Special Appeal No. 232 of 2007

Sri Vishnu Kant Gupta


Official Liquidator and others



Hon'ble  Sushil  Harkauli  J.

Hon'ble  Ajai  Kumar  Singh  J.

(Delivered  by  Hon'ble  Sushil  Harkauli  J.)

Facts :

The facts relevant for deciding this appeal are that the company known as Champaran Sugar Company Limited went into liquidation on the recommendation of the B.I.F.R. In the winding up proceedings, the High Court invited separate tenders for sale of two units (factories) of the Company in liquidation. These two units are known as the Barachakia Unit and Chanpatia Unit. After opening of tenders, the Court negotiated the price with the prospective buyers, and by order dated 31-01-2001 the bid of the present appellant V.K.Gupta, being the highest offer of Rs. 5 Crore, was accepted by the Company Judge for the Barachakia unit.

By another order dated 23.5.2001, the Company Judge accepted the highest offer of the present appellant V.K.Gupta (hereinafter referred to as 'the appellant' for short) for Rs. 2.01 Crore for the Chanpatia Unit. But that sale is the subject matter of another appeal. This appeal is not concerned with the Chanpatia Unit. It is concerned only with the Barachakia Unit.

The order dated 31st January 2001, accepting the highest bid of the appellant, reads as follows:

"When this matter was taken up today, a letter of offer was given on behalf of Hanuman Industries (India) Pvt. Ltd. through their counsel Ms. Geeta Luthra, which was supported by three bank-drafts totaling Rs. 10 lacs. Sri Sanjeev Sahai had already placed photocopies of these bank drafts on record, on the last date. In the letter of offer the sale consideration offered was Rs. 3,51,00,000/- and it was proposed that 25% of the amount would be paid within three months and the balance would be paid within such further extended time which the Court may grant. Although in the first paragraph of the said letter it has been stated that purchase was on "as is where is basis" but in the subsequent paragraph of the letter of offer certain conditions have been put.

Having regard to the conduct of M/s. Hanuman Industries during the history of this litigation, more particularly the decision of this Court In re: Champaran Sugar Company, Reported in 1998 Vol (91) Company Cases, 182, it was thought that the acceptance of such conditions might lead to further litigation and perhaps an attempt to avoid the contract on one excuse or the other. Therefore, it was suggested that offer of M/s Hanuman Industries (India) Pvt. Ltd. would not be considered unless all conditions were waived and the property was purchased on purely "as is where is basis". Learned counsel representing M/s Hanuman Industries (India) Pvt. Ltd. agreed to the suggestion and, therefore, they were allowed to make a clear offer. The clear oral offer made initially was for Rs. 3,51,00,000/- payable in seven months time. One installment was proposed to be paid in three months and the second installment within further period of four months.

As against this Sri Vishnu Kant Gupta had made a written revised offer of Rs. 3,51,00,000/- payable in four equal quarterly installments on the condition that possession of the factory may be given by the Official Liquidator to Sri Gupta upon payment of the first installment and upon furnishing of Bank guarantee for the remaining amount.

The matter was negotiated with both the parties and leaving out details of step by step increase of offers, as against the last offer of M/s Hanuman Industries of Rs. 3 crore 91 lacs payable in eight months time, the last offer made by Sri Vishnu Kant Gupta was of rupees five Crores payable in two quarterly installments i.e. in six months. The first installment to be paid after adjusting the amount of rupees ten lacs of which bank-draft has already been submitted by Sri Gupta, within three months from today. The balance payment to be made within a further period of three months. M/s Hanuman Industries (India) Pvt. Ltd. were unable to improve upon this offer of Sri Vishnu Kant Gupta either in terms of increasing the amount or in terms of reducing the period of six months, fixed for payment. Learned counsel for M/s Hanuman Industries asked for further period of one day for considering whether her client would be in a position to improve upon this offer.

The order dated 10-1-2001 states that time is being granted to M/s Hanuman Industries as a last resort upto 17-1-2001 to come up with a substantially better offer. Thereafter the order dated 17-1-2001 states as follows "It has been made clear to both the parties (i.e. Vishnu Kant Gupta & Hanuman Industries) that if offers are received from both the parties, negotiation may take place on 31-01-2001 for finalising the auction/tender sale in favour of one of the parties. Both the parties are, therefore, advised to be present in person along with their counsel so that the counsel may be instructed regarding raising of offer, if negotiation takes place, as stated above."

Having regard to the above, and other over all circumstances and the period which has expired and the margin which was granted to M/s Hanuman Industries I am unable to accept this suggestion of granting further time, that too without any assurance that the amount would actually be increased.

In the circumstances, the offer of Sri Vishnu Kant Gupta is accepted as stated above. Sri Gupta will be entitled to possession of the factory upon payment of first installment coupled with the furnishing of the bank guarantee for the remaining amount to the satisfaction of the Official Liquidator. The bank guarantee will be made out in favour of the Official Liquidator. The bank guarantee will state that if the payment of the amount guaranteed by the bank is not made upto 1.8.2001, upon demand by the the Official Liquidator, after that date the bank will make payment of the amount guaranteed to the Official Liquidator.

It may be mentioned here that Sri O.P. Mishra representing IFCI has also been heard before passing this order in support of his objection in which IFCI had stated that the valuation given by Sri Vishnu Kant Gupta was slightly lower and correct valuation according to IFCI, on the facts and circumstances stated by Sri Vishnu Kant Gupta, should be Rs. 4,16,00,000/-. Since the final offer made by Sri Vishnu Kant Gupta is much above that valuation and after examining the Official Liquidator's report with regard to valuation, I am of the opinion that the offer made by Sri Gupta is reasonable and in absence of better offer it should be accepted.

The offer of Sri Vishnu Kant Gupta is therefore hereby accepted as above and subject to the conditions as stated above in his last offer of Rupees Five Crores."

Thus, by the above quoted order six months time had been granted to the appellant for payment of the sale consideration provided the first installment was deposited within three months from 31.01.2001.  

Before the said period of three months, fixed for the payment of first installment, could expire on 30.4.2001, two Special Appeals were filed. They were (i) Special Appeal No. 153 of 2001, M/s Hanuman Industries (India) Pvt. Ltd. Versus Official Liquidator; and (ii) Special Appeal No. 195 of 2001 M/s. N.N.P. Trading versus Official Liquidator. In those appeals by interim orders dated 7.2.2001 and 13.3.2001, the Appellate Bench stayed the operation of the order of the Company Judge dated 31.1.2001 quoted above.

Both the special appeals aforesaid were dismissed for want of prosecution on 5.12.2006 and the stay orders were discharged.

The matter went back before the Company Judge, who passed an order dated 22.1.2007, which reads as follows:

"Sri Anjani Kumar Misra, appearing for Official Liquidator, informs that both the Special Appeals, with regard to sale of the assets of the units of Bara Chakia Sugar Mills, have been dismissed on 5.12.2006.

He has also informed that the highest bidder has not deposited the amount due from him in accordance with the schedule fixed by the Court. Let the Official Liquidator submit a report with regard to the defaults and give a show cause notice to the highest bidder as to why his bid may not be cancelled. The notice be given within a week. List on 12.2.2007."

Pursuant to the above order, the Official Liquidator issued the show cause notice to the appellant by registered post on 8.2.2007, which was served upon the appellant on 14.2.2007.

Before the receipt of that notice for showing cause against cancellation of the accepted bid, the appellant on coming to know about the dismissal of the special appeals, voluntarily paid Rs. 1.5 crore to the Official Liquidator as part sale consideration on 9-2-2007.

On 12.2.2007, also before the date on which the notice of the Official Liquidator dated 8.2.2007 was served, the appellant moved an application before the Company Judge offering to pay a further amount of Rs. 1.55 crore forthwith by bank-drafts, which were ready with him in the Court, and also gave an undertaking to pay the entire remaining amount of sale consideration amounting to about Rs. 2 crore within the next three days. On that very date i.e. 12.2.2007 one M/s. J.H.V. Sugar  gave an offer before the Company Judge to buy the Barachakia Unit for Rs. 5.21 crore. Another, M/s. Shiv Shakti Chini Mills Private Limited offered Rs. 6 crore, and yet another one Sanjeev Kumar Chawdhary offered Rs. 6.5 crore, as against the appellant's bid of Rs. 5 crore.

Upon this, the learned Company Judge by the impugned order dated 12.2.2007 ordered revaluation of the Barachakia Unit and re-advertisement of the same for inviting fresh offers.

The only reason given by the learned Company Judge for such decision is to be found in paragraph No. 6 of the impugned order which reads:

"having regard to facts and circumstances and the higher bids, it is apparent that the value of the assets of Barachakia unit has gone up considerably."

Also, the same impugned order also directed that pursuant to the fresh advertisement, the bidders who were present on that day including the appellant will deposit an amount of Rs. 5 crore each, by means of bank-draft drawn in favour of the Official Liquidator. The bank-draft was to be deposited on or before 12.3.2007 and the matter was directed to be listed on 14.3.2007. It was also directed by that order that any other bidder wanting to participate would also be required to similarly deposit the same amount of Rs. 5 crore.

About earnest  money :

      To have a stipulation, requiring deposit of some earnest money as a pre-condition for participation in sale of property by auction or tender is quite normal. But because the purpose of such a condition is to keep out frivolous or non-serious or mischievous participants and to ensure that the successful bidder does not resile, therefore the amount fixed as earnest money should, save for very exceptional reasons, be a reasonable fraction of the expected sale consideration. In the present case, requiring the deposit of earnest money almost equal to the entire sale consideration appears a little unusual. No exceptional reasons have been  spelled out for this unusual step. It overlooks the fact that the sum of Rs. 5 crore is not a small amount which even businessmen of reasonable stature can deposit out of pocket. Such heavy amounts are usually borrowed against security and under heavy interest liability. Delay in finalising such sales being quite normal, the requirement of pre-deposit of Rs. 5 crore, would force each of the intending bidders to incur such heavy liabilities towards interest, although ultimately only one bid can be accepted. But at present, in this  appeal, we need not directly concern ourselves further with this aspect of the matter.

The  appellant's challenge :

Opposing the re-advertisement, the submission from the side of the appellant is that no re-advertisement could have taken place without first canceling the bid of the appellant which had been accepted by the Company Judge by the order dated 31.1.2001. Admittedly no such cancellation has taken place. The appellant submits that cancellation was not permissible due to the following reasons :-

1.The show cause notice against the proposed cancellation had not even been served till the date of the impugned order;

2. There was no fault or default of the appellant, and if there was any it was not sufficient in magnitude to sustain the cancellation of the bid;

3.Mere rise in prices during litigation is not a ground for denying relief as held by the Supreme Court in S.V.R. Mudaliar Versus Mrs. Rajabu F. Buhari (infra), therefore the appellant's bid could not be cancelled on that ground;

Regarding  default :

The appellant submitted that he  cannot be held to be a defaulter. He relies upon the decision of the Supreme Court in the case of Smt. Indira Nehru Gandhi versus Shri Raj Narain, (1995) 2 S.C.C. 159. Paragraphs No. 24 and 25 of the aforesaid law report lay down that the legal effect of a stay order passed by the Appellate Court is that the impugned judgment and order is nullified till disposal of the appeal and that there is a plenary eclipse of the impugned judgment. According to the appellant's submission, once there was a stay of the order of the Company Judge dated 31.1.2001, the obligations of all parties under that order of the Company Judge came under an eclipse and, therefore, the appellant was exempted by virtue of the stay order passed in the special appeals from discharging his obligations of payments as per schedule fixed by the order of the Company Judge dated 31.1.2001. The appellant also submits that his obligations would revive again only from the date on which the appellant acquires knowledge of the disposal of these appeals.    

       We think it would have been very unreasonable to expect that the appellant should have deposited the entire sale consideration upto 31-7-2001 (as originally contemplated) when in return the Court was not in a position (due to the appellate stay order) to convey either title or possession of the property. More so, when this inability of the Court was likely to continue for an indefinite period while the special appeals remain pending, which could well be several years. And maybe at the end of that long period, if either of the special appeals was allowed, the appellant would have to be told to take back his deposit. Even if the Liquidator were to be directed to refund the deposit with interest, the interest earned from the Bank on the deposit by the Liquidator would obviously be much less than the interest paid by the appellant on the borrowed capital. This would cause irreparable loss of the heavy interest for the entire period during which the appeals remained pending. Therefore, even without the aid of precedents, the only just view to take is that upon stay being granted in the special appeals the obligation of the appellant to make deposit of any installment of the sale consideration also stood suspended. Therefore the appellant cannot be held to be a defaulter for not sticking to the original payment schedule fixed by the order dated 31-1-2001.

On the above reasoning if the appellant had deposited the entire amount of sale consideration on 5-12-2006 that is the date of dismissal of the two special appeals, he would obviously not be a defaulter.

Before considering whether the time taken in payment, after 5-12-2006, would make the appellant a defaulter, we may examine a suggestion made during arguments by the learned counsel for some of the secured creditors. He suggested that even if due to the stay order the appellant was not required to make the payment during pendency of the appeals, yet after dismissal of the appeals he should be directed to pay the commercial rate of 18% interest from the date originally contemplated for payment till the actual payment i.e. roughly for a period of 6 years. We find this suggestion, especially when it comes from financial institutions, to say the least, a little unconscionable.  If the submission is accepted the appellant would be required to pay almost double of the original offer of 5 crore. This is difficult to justify because even today the best offer available does not exceed 6.5 crore and it nobody's case that the property is worth 10 crore.  

Reverting back to default, the stay orders, which were passed in the special appeals long before the time for deposit of first installment had run out, continued for almost six years. In the circumstances, no default in payment by the appellant could be said to have taken place in absence of a finding about the date of the appellant's knowledge regarding the dismissal of appeals and any unreasonably long and unjustified delay thereafter. It is obvious that after so many years, the appellant could not have anticipated that the appeals would be dismissed all of a sudden. Further, after the appellant acquired the knowledge of the dismissal of the appeals, it can reasonably be assumed that the appellant would require some reasonable amount of time to arrange for the sale consideration of Rs. 5 crore. It would again be unreasonable to expect any businessman to keep Rs. 5 crore as liquid assets for so many years. After acquisition of knowledge of dismissal dated 5-12-2006 and thereafter giving allowance of reasonable time to arrange for funds, even if some short delay is left upto 12-2-2006, it can not be called a default of sufficient magnitude as to entail cancellation of the appellant's bid, particularly when the order dated 31-1-2001 did not contain a forfeiture-on-default clause, and the part payment was made on 9-2-2007, another part tendered on 12-2-2007 and balance was offered to be paid by 15-2-2007. Even if legally and theoretically permissible, Courts do not favour imposition of extreme penalties for every minor default.

Effect of  price rise :

The second challenge by the appellant is with regard to the solitary reason given in the impugned order. The challenge is based upon the decision of the Supreme Court in the case of S.V.R. Mudaliar Versus Mrs. Rajabu F. Buhari, A.I.R. 1995 S.C. 1607 (Paragraph 22) which lays down that mere rise in prices of properties during the period of delay in litigation is not a ground to deny the relief, if otherwise due. The relevant part of the decision reads:

"..................If merely because the prices have risen during the pendency of litigation, we were to deny the relief of specific performance if otherwise due, this relief could hardly be granted in any case, because by the time the litigation comes to an end sufficiently long period is likely to elapse in most of the cases. This factor, therefore, should not normally weigh against the suitor in exercise of discretion by a Court in a case of the present nature."

No arguments were addressed before us as to how in the present case a view different from the above can be taken.

The respondents'  main  defence :

Mainly, the respondents attempted to justify the impugned order by relying upon the decision of the Supreme Court in the case of Divya Manufacturing Company (P) Ltd. Versus Union Bank of India and others, (2000) 6 S.C.C. 69. This decision is not mentioned in the impugned order of the learned Company Judge. But it has been submitted by the secured creditors that it can sustain the impugned order.

The reply of the appellant is that the said decision of the Supreme Court is clearly distinguishable on the following grounds. First, that in the case before the Supreme Court, there was a right reserved of the High Court under clause 11 of the 'terms and conditions of sale', which read as follows:

"11. The Hon'ble High Court may set aside the sale in favour of purchaser/purchasers even after the sale is confirmed and/or purchase consideration is paid on such terms and conditions as the Court may deem fit and proper for the interest and benefit of creditors, contributories and all concerned and/or public interests."

It has been stated by the appellant, and not disputed by the respondents, that in the case in hand the High Court had not reserved any such right in the 'terms and conditions of sale'.

Secondly, it has been submitted by the appellant that the higher offer in the case of Divya Manufacturing Company (P) Ltd. (Supra) was given within just nine days of the sale in favour of Divya Manufacturing Company. It has been submitted by the appellant that the offer in the present case by the three persons named in the impugned order has come on 12.2.2007 i.e. more than six years after the appellant's bid has been accepted.

Last and most important, the vital facts which are the basis of the decision in Divya Manufacturing Company (P) Ltd. Versus Union Bank of India and others, (2000) 6 S.C.C. 69 are not available in this case. These facts are spelt out towards the end of paragraph number 11 of the law report, and are being quoted below :

"Further, the application for setting aside the sale was filed within a few days of the order accepting the bid of the appellant. In this set of circumstances, when the correct market value of the assets was not properly known to the Court and the sale was confirmed at a grossly inadequate price, it was open to the Court to set it at naught in the interest of the Company, its secured and unsecured creditors and its employees." (emphasis ours)

It has been argued that while deciding a case the Superior Courts are also laying down the law for future cases. The Courts should therefore take care that the law laid down by them does not have the effect of undermining the confidence of the public, litigants and bidders in the sale proceedings conducted by the High Court. Therefore it would not be appropriate to lay down as a general and universal proposition of law that after acceptance of the highest bid the whole matter can be reopened for fresh auction or tendering merely because some person who had not participated decides, after knowing the amount of final bid which has been accepted, to make a slightly higher offer. It has been submitted that if such a law is laid down, then apart from rendering sealed tender procedure meaningless, no honest business man can ever be expected to invest his time and money in such an uncertain and risky venture and it will become difficult to obtain proper and high bids. It has also been submitted that if this view of the law is carried to its logical conclusion, there would never be any end to the proceedings because after the conclusion of the second round, again some third party may come up to make a slightly higher offer thereby again reopening the whole proceedings.

It has, therefore, been suggested from the side of the appellant that the case of Divya Manufacturing Company (P) Ltd. (Supra), which has been decided on its own facts, should be restricted to a particular class of cases the facts of which match the facts of that decision and consequently require such a view to be taken.

There is no finding in the impugned order and no arguments have been addressed before us by any of the respondents in this appeal, either that (i) the proceedings resulting in acceptance of the appellant's bid are vitiated by any fraud, or any error akin to fraud like formation of a cartel by bidders; or that (ii) at the time when the appellant's bid of Rs. 5 crore was accepted, the property was worth substantially more.  In view of the above there can be little doubt that the decision of Divya Manufacturing Co. has no application in the facts of the present case, and the appellant's bid could not have been cancelled on that ground. We assume that the said decision was, for reason of inapplicability, deliberately not referred in the impugned order.    

Also when the accepted bid was a fair offer, having regard to the value of the property at that time, then the mere rise in its value by now would not justify this Court from resiling from the acceptance granted by this Court to the appellant's bid, in view of S.V.R. Mudaliar vs. Mrs. Rajabu F. Buhari (supra). Therefore also the bid could not be cancelled on the ground of rise in prices.  

While no doubt the Court's concern should be to obtain the best possible price for the assets of a company in liquidation, but in our opinion this concern should not be carried to a limit where the sanctity and reliability, of a Court's acceptance of the highest bid, itself is lost. Court's orders must inspire highest degree of confidence, at least of the persons who are touched by those orders. Confidence cannot be achieved if there is lack of reasonable certainty or lack of logical reasoning relevant to the nature of dispute.

At this stage we may also point out that by the impugned order, the appellant has been placed in a position worse than the fresh bidders, because his earnest money of Rs. 10 lacs and the amount of Rs. 1.5 crore, already deposited by him with the Official Liquidator, has been blocked and has not been ordered to be returned and, he has been asked to deposit a further amount of Rs. 5 crore, whereas the fresh bidders have only to deposit a sum of Rs. 5 crore. It was argued by the respondents that the learned Company Judge by the impugned order dated 12-2-2007, in his wisdom rightly did not cancel the bid of the appellant so that if better offers do not mature, the appellant could be held to his offer of Rs. 5 crore, which was accepted on 31.1.2001.

We are unable to agree. It is quite obvious that unless the acceptance of a bid is cancelled, the question of revaluation or re-advertising does not arise. The acceptance of a bid by the Court is in a way equivalent to an agreement for sale. After acceptance of the bid, if the successful bidder fulfills his obligation, the bid-acceptance order carries with it an assurance that the Court would execute or direct execution of the sale deed or sale certificate. Legally no sale to a third party, and morally no negotiation with a third party, can be made by the vendor during the subsistence of his obligation to the original promisee under the agreement for sale.

A  suggestion :

We think that if some rival businessmen had made higher offers, the better course would have been to get the genuineness of those offers authenticated by requiring each of the higher bidders to deposit a substantial amount sufficient to deter non-serious or mischievous offers, before putting the entire sale proceedings in jeopardy by ordering a fresh advertisement. Such offers, unless backed by solid security, could only be treated as frivolous offers, because it has not been explained as to how these new competitors came to know the date in the Company Court on which all of them appeared together to make their offers. In fact this conclusion about the nature of those offers is corroborated by the fact that none of those persons deposited the bank draft of Rs. 5 crore each by 12-3-2007 as directed by the impugned order. If the deposit was not made because these new competitors had come to know about this special appeal and the interim order passed herein, it could reasonably be expected that at least some of them, if not all, would have entered appearance in this appeal, that is if they were seriously interested in the property, to make sure that the appellant does not get a walk-over. Perhaps the lack of confidence in these higher offers was the reason why, as argued from the respondents' side, it was decided to continue to hold on to the appellant's accepted bid while taking a chance at getting a higher price by re-advertising.

Conclusion :

In view of the above discussion, the impugned order dated 12.2.2007 can not be sustained. There was no good ground for canceling the accepted bid of the appellant. Consequently there was no occasion to re-value or re-advertise the property. The fact that after six years somebody was making a higher offer was not sufficient, in absence of such reservation of power in the 'terms and conditions of sale', to warrant cancellation of the appellant's bid. Further, the departure from the original payment schedule, in making deposit of sale consideration was not because of any fault on part of the appellant but, because of the stay orders passed in special appeals which remained pending for almost six long years.  The short delay between the dismissal of the special appeals and the deposit is also not sufficient for canceling the appellant's bid. That short delay can be  compensated by ordering the appellant to pay interest at the rate of 10 per cent per annum from the date on which the special appeals were dismissed till the date on which the impugned order was passed i.e. 12-2-2007, and thereafter from the date on which, pursuant to this decision, the learned Company Judge passes the order permitting deposit of the balance till the date on which actual payment is made by the appellant. The rate of interest has been fixed on the criteria that if payment had been received by the Official Liquidator on the due date i.e. 5-12-2006, this rate is roughly the rate at which he would have earned interest from the bank deposit pending disbursement of the deposit to creditors. It is clarified that the interest will cease to be payable on any part amount deposited, as from the date of the deposit. The period after 12-2-2007 has been excluded from interest liability because non-deposit after that date would be attributable to the impugned order and would not be attributable to the appellant.  

Thus the interest would be payable @ 10% on the amount of Rs. 1.5 crore from 5-12-2006 up to 9.2.2007 i.e. the date on which that amount was deposited with the Liquidator.  Interest at the same rate would also be payable on the remaining sale consideration of Rs. 3 crore 40 lac {i.e. Rs. 5 crores as reduced by (i)  the earnest money of Rs. 10 lacs and (ii) the deposited amount of  Rs. 1.5 crore} from 5-12-2006 up to 12-2-2007, i.e. the date of the impugned order, and thereafter again from the date of the next order of the Company Judge permitting such deposit of the balance upto the date of its actual deposit.

We are not fixing the payment time schedule here because summer vacations are very close, the availability of the learned Company Judge during vacations is not known, and we were informed that the case is tied up with the Hon'ble Judge who passed the impugned order. We do not think it would be just to compel the appellant to make the entire deposit and then to make him wait unduly long even for possession of the property for which he has made full payment. Further, we are of the opinion that finalising the sale is beyond the scope of this special appeal, and more so when we have not even heard arguments from that point of view. However, we may suggest that it will be open to the learned Company Judge to consider, having regard to the delay which has already taken place as also the ensuing vacations, while fixing the time for payment of the balance, as to whether the order should include a direction to the Liquidator to deliver possession after the full payment is credited to the Liquidator's bank account, without waiting for the formalities of sale-confirmation and sale-deed/sale-certificate, which formalities can be completed later. This suggestion will not be interpreted to mean that the learned Company Judge is bound to go ahead with the sale even if there is any other legally valid ground to refuse such relief.

Order :

In the circumstances, this appeal is allowed. The impugned order dated 12.2.2007 is set aside. All relevant parties are represented in this appeal, and they are put to notice that the office is being hereby directed to place the matter before the learned Company Judge again for appropriate orders on 23.5.2007 or on the next date of his availability thereafter, if the learned Judge is not available on 23-5-2007.   Certified copy of this order be issued, on application and payment of requisite charges, today.

Dated: 21.5.2007




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