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TMI Blog2014 (10) TMI 958X X X X Extracts X X X X X X X X Extracts X X X X ..... plots. It is not change of heart, but the price reality that gets manifest. Not for nothing it has been said, "money can solve the problems concerned with money". The large amount of money, we are inclined to think, would solve the problems of the company in question. 2. A short narration-a company, namely, M/s Vitta Mazda Ltd. went into liquidation and on 21-2-2002, the High Court of Gujarat directed the Official Liquidator to put up the properties of the company in liquidation (except those for which applications are pending before the said Court for regularisation of transactions) to auction for sale. Thereafter many an order was passed. On 18-12-20041, the learned Company Judge, by taking into consideration many aspects, declined to accept the report of the Official Liquidator for acceptance of the offer made before the Sale Committee. An appeal was preferred being OJ Appeal No. 81 of 2004, wherein the Division Bench of the High Court on 30-8-20112 passed the following order: (SCC OnLine Guj paras 1-2 & 4-6) "1. The present appeal arises against the order dated 18-12-2004 passed by the learned Company Judge in Official Liquidator v. Central Bank of India, whereby the learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after to undertake the process to sell and dispose of the plots at a later stage. In view of the above, if the property is segregated into various compartments of clear property, property with clog and/or property with encroachment, while disposing of the immovable properties, it would be rather in the interest of the company, since the clear property is bound to fetch higher price in comparison to the other two properties, namely, with clog in the title and/or with encroachment or otherwise." 3. When the matter was listed on various dates, it was thought appropriate that there should be a proper auction and, accordingly, the following order came to be passed on 2-7-20143: " This Court, while issuing notice on 2-11-20124 had passed the following order: 'The learned Senior Counsel appearing for the petitioner submits that the petitioner is willing to match the offer of Rs. 6.25 crores made by Bank of Baroda. Submission recorded.' Thereafter, the matter has been adjourned and certain applications have been filed for impleadment, which are allowed. Mr Ahmadi, learned Senior Counsel appearing for the applicant M/s SNDT Enterprises in IAs Nos. 6-7 of 2013 has submitted that the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall be completed within four weeks therefrom. As far as M/s Star and Associates is concerned, if they offer a bid of less than Rs. 30 crores that bid shall not be accepted but their claim of amount shall be considered subject to further orders of this Court. Similarly, as far as Mr Ranjitsinh Parmar is concerned, his bid for less than Rs. 25 crores shall not be considered but he would be entitled to claim refund of the amount subject to further orders of cost. The Managing Director of M/s SNDT Enterprises on whom costs of Rs. 5 lakhs were imposed shall remain personally present on the next date of hearing if the costs, as directed, are not deposited before the Registry of this Court. In case the deposit is made, an affidavit shall be filed and he need not appear in person. Needless to emphasise that in the event of non-deposition, he shall personally appear and this Court may consider passing appropriate orders in that regard. We may add that anyone who intends to bid, he has to deposit a sum of Rs. 10 crores as earnest money so that he can claim parity with the three contenders who are before this Court. Barring what we have stated, the other conditions in the initial notice f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Rs. 31 crores. It is submitted by Mr A. Sharan, learned Senior Counsel for the appellant, that the Official Liquidator had no authority to issue a corrigendum or to place a clarificatory note in respect of the plots. That apart, submits Mr Sharan, the Official Liquidator has committed grave illegality and, in a way, contempt of the court by approaching the High Court and stating that this Court had made certain oral observations which was really not correct, for everything was unequivocally stated in the order. Ordinarily, we would have proceeded to address the submissions made with emphasis by Mr A. Sharan, but as advised at present, we are refraining from doing so, for what has happened in the course of hearing. 8. Here the sad sad story begins. Mr Tushar Mehta, learned Additional Solicitor General, while defending the stand of the Official Liquidator, though made certain efforts to justify his action, yet ultimately realised that it was a Sisyphean endeavour because the action may be genuine but should not have been undertaken. Mr Tushar Mehta learned Additional Solicitor General, and Mr Gaurav Agrawal, learned counsel, appearing for the Official Liquidator, while expressing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A welfare State exists for the largest good of the largest number more so when it proclaims to be a socialist State dedicated to eradication of poverty. All its attempt must be to obtain the best available price while disposing of its property because the greater the revenue, the welfare activities will get a fillip and shot in the arm. Financial constraint may weaken the tempo of activities. Such an approach serves the larger public purpose of expanding welfare activities primarily for which the Constitution envisages the setting up of a welfare State." 10. In the aforesaid case, the Court held auction in Court in respect of some quarries relating to minor minerals. The appellant therein who initially had given an offer of Rs. 5.5 lakhs, eventually offered Rs. 25 lakhs. Taking note of the state of affairs, the Court observed: (Ram and Shyam Co. case, SCC p. 274, para 6) "6. Shock and surprise was visible on the face of each one in the Court. Shock was induced by the fact that public property was squandered away for a song by persons in power who hold the position of trust. Surprise was that how judicial intervention can serve larger public interest. One would require a multi-lay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation by the Company Court. Gitco has estimated the valuation in praesenti. It is not in dispute, as per the orders passed by the Company Court as well as the Division Bench in company appeal and as understood by this Court, 291 plots were to be put to auction and for the total number of plots the prices were offered by the bidders who had shown interest before this Court to bid and this Court had fixed the reserve price at Rs. 10 crores. The counsel for the parties on 2-7-2014 had gone to the extent of saying that they were prepared to offer Rs. 25-30 crores in the auction and we have already mentioned that offers have come in a sealed cover. 14. Ordinarily, what we would have done is absolutely another matter. There can be no speck of doubt that the properties of a company under liquidation when sold, there has to be a proper auction, a fair one. It must fetch the maximum price. It takes care of statutory dues, dues of the workmen and the creditors. It has its own public character. In any case, it cannot be allowed to be sold for a song. The estimated price given by Gitco is more than Rs. 66 crores for 113 plots, which are free. Therefore, we thought it seemly to ask the learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ason, extension is sought, Rs. 10 crores that has been deposited before this Court along with interest shall stand forfeited and go to the account of the company. This aspect is also conceded to by Mr Braj Kishore Mishra and Mr Vivek Trivedi. 17. As far as deposits made by the petitioner and Mr Ranjitsinhji Parmar before this Court are concerned, the deposits shall be refunded along with interest within two weeks hence. The amount deposited by Mr Laxmi Narayan Garg with the Official Liquidator shall also be refunded within a week from today. Any earnest money that has been deposited with the Official Liquidator shall also be refunded to the company/person concerned. 18. At this juncture, it is appropriate to mention that the rest of the plots in respect of which there is an order of status quo by this Court or which are sub judice before the appellate court on the company side before the High Court, needless to say, shall be dealt with at the subsequent date. 19. At this juncture, we are obligated to clarify that interlocutory applications which have been filed before this Court can be filed before the High Court and the orders passed by the High Court shall be filed before this ..... X X X X Extracts X X X X X X X X Extracts X X X X
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