TMI Blog1992 (7) TMI 248X X X X Extracts X X X X X X X X Extracts X X X X ..... official liquidator was appointed as the liquidator thereof. A sister concern of the Golden Films Private Limited by name Golden Studios Private Limited was also ordered to be wound up in Company Petition No. 8 of 1972. By an order dated December 23, 1976, a learned single judge of this court directed sale of 23 acres and 66 cents of land belonging to the company to Mrs. B. Sakunthala, the appellant, for a consideration of Rs. 22 lakhs payable in six equal monthly instalments. She, however, paid no instalments and thus, the question of sale came up for consideration again. Some persons gave their offers of amounts higher than Rs. 22 lakhs but the learned company judge decided to order for the sale in favour of the Central Warehousing Corporation (hereinafter referred to as "the Corporation"), for a sum of Rs. 20 lakhs only. The learned judge, it seems, had reasons for doing so although the amount offered by the Corporation was less than the amount offered by others. The order, however, in this behalf stipulated that the Corporation shall pay a sum of Rs. 5 lakhs within one week from the date of the order, viz ., December 17,1976, and the balance within a week after taking deliv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en before this court". "In view of the order made by Suryamurthy J., I am unable to entertain the argument that the sale made to the first respondent is subject to confirmation of court. I had already referred to the text of the order, in particular the direction that the official liquidator shall execute a sale deed in favour of the Central Warehousing Corporation. There is also specific direction directing the official liquidator to sell 23 acres and 66 cents of land, building, etc., belonging to the company to the Central Warehousing Corporation for a sum of Rs. 20,00,000. Thus the court itself had directed the sale and also directed the official liquidator to execute the sale deed. In the teeth of such directions, it is impossible to countenance the argument that the sale is subject to confirmation by the court. On the other hand, there had been a sale by this court itself except that the official liquidator was called upon to execute a sale deed to accept the purchase price and to effect delivery of the property to the purchaser-first respondent". "If the parties were really aggrieved against the said order made by the learned judge, their remedy is to have preferred an ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alf, as noticed above, under sub-section (6) of section 460 of the Act, wherein it is stated that: "(6)Any person aggrieved by any act or decision of the liquidator may apply to the court; and the court may confirm, reverse or modify the act or decision complained of, and make such further order as it thinks just in the circumstances". Certain rights of the creditors and the contributories such as the one in sub-section (1) of section 460 of the Act, which reads: " 460. Exercise and control of liquidator's powers. ( 1 ) Subject to the provisions of this Act, the liquidator shall, in the administration of the assets of the company and the distribution thereof among its creditors, have regard to any directions which may be given by resolution of the creditors or contributories at any general meeting or by the committee of inspection". are given. It may thus be pertinent to say that the liquidator's custody of the company under liquidation is next to that of the court and for any act affecting the properties of the company under liquidation he has to obtain the sanction of the court and if there is any act of the liquidator in this behalf not acceptable to the creditors and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the court to sell the property and after such sanction alone he should sell the property. After sale there is a requirement of confirmation by the court because the sale by the liquidator with the previous consent of the court, unless confirmed, will not become final. A Division Bench of the Gujarat High Court dealt with a case of sale of property of a company under liquidation as directed by the court in the case of Universal Dyestuff Industries Ltd., In re [1988] 63 Comp Cas 842. That was a case in which the learned company judge directed the liquidator to sell the property to the highest bidder. The court, however, declined to confirm the sale. One of the highest bidders appealed. The Bench hearing the appeal noticed the argument of learned counsel, similar to the one dealt with by the learned company judge in the instant case, in these words (at page 844): "Mr. Shah, learned counsel appearing for the appellant, mainly contended that the direction dated December 11, 1987, has specifically given powers to the provisional liquidator to sell all the articles on an 'as and where is' basis after inviting offers from the intending purchasers and accepting the highest offer. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mation, as stated in the decision referred to above, the inadequacy of the price can be a relevant ground for the court to interfere in such sales and that in the interest of the company, the court can make such direction for the purpose of getting an adequate price for the properties belonging to the company in liquidation". The case before a Bench of this court in Soundararajan ( S. ) v. Khaka Mahomed Ismail Saheb, AIR 1940 Mad 42, referred to in the Gujarat judgment above, was one with respect to a court-sale under Order 21, rule 92 of the Civil Procedure Code. It is obvious thus that the principles which apply with respect to the court sale under Order 21 and confirmation under rule 92 of the Civil Procedure Code, as prescribed thereunder are applied with respect to the sale by a liquidator with the consent of the court or under the orders of the court. The Bench of this court in S. Soundararajan's case, AIR 1940 Mad 42 has observed that (p. 43) "it is only right and proper that the sale should be subject to the confirmation of the court. The condition is a safeguard against irregularity or fraud in connection with the sale and against property being sold at an inadequa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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