Konark Jute Ltd Vs

Arindam Sinha, J

Mr. Nanda, learned senior advocate appears on behalf of Bhatia OSL Washeries and Minerals Ltd. (BOSLWML). He submits, his client was successful auction bidder and purchaser. He draws attention to order dated 29th April, 2011 passed by the then Company Judge to demonstrate there was direction upon his client, on being found to be highest bidder, to deposit entire bid amount of Rs.34 crores before Industrial Development Corporation of Odisha Limited (IDCOL). He submits, the bid money was deposited in full. His client took control of the company sold, the Konark Jute Ltd., which was subsidiary company of IDCOL. His client is now before Court seeking confirmation of the sale.

Ms. Rath, learned advocate appears on behalf of IDCOL and submits, her client only assisted Court for revival of its subsidiary. The consideration received was distributed to meet claims against the subsidiary, by its workers, creditors etc. She prays for adjournment to rely on judgment(s) that even after there is recommendation for winding up made under section 20 in Sick Industrial Companies (Special Provisions) Act, 1985, the Court can embark on exercise to revive the company.

Mr. Biswal, learned advocate appears on behalf of applicant in Misc Case no.2 of 2021 and renews his prayer for disbursal of the dues from the sale proceeds.

Order dated 21st April, 2022, made by this Bench, makes it clear that there was reference to this Court from the Board, it having recommended winding up of the subsidiary company. It appears the then presiding Company Judges had acceded to embarking on exercise to revive the company, on sale of it. The purchaser is before Court seeking confirmation of sale. Mr. Biswal’s client claims disbursement from the sale proceeds. The holding company, having received the proceeds, contends that the purchaser purchased along with subsisting liabilities and must deal with claims made against the subsidiary company purchased by it.

Adjournment granted is peremptory. IDCOL will be heard on demonstrating terms of the auction notice. It had received the sale proceeds. The subsidiary company instead of being would up was directed to be sold away.

Ms. Rath prays that adjourn date be atleast four weeks away. Accordingly, list on 23rd August, 2022.

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