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Judgment
The appeal is directed against an order dated August 18, 2017 by which the sale of three lots of the company''s land has been confirmed on the basis of the official liquidator''s report placed before the company Court.
It is somewhat surprising that the order impugned betrays the complete lack of interest of the company Court to ensure that the best price is obtained for the assets of a company (in liquidation). The order merely confirms the official liquidator''s report without making any attempt to have the highest offerer increase his bid. It is elementary that when a company Court sells the assets of a company (in liquidation), it does so as the trustee and for the benefit of all the creditors of the company (in liquidation). More often than not banks and unsecured creditors lose out upon a company going into liquidation. The more money that the assets of a company (in liquidation) fetch, the more the dues of the creditors can be met therefrom.
The three lots of land in this case were sold at Rs.10 lakh, Rs.25 lakh and Rs.5 lakh, respectively. The appellant herein said that it had identified a purchaser for Rs.30 lakh for the first lot. The appellant offered Rs.65 lakh for the second lot and Rs.15 lakh for the third lot. Such offers are recorded in the previous order in this appeal passed on December 15, 2017.
The purchaser is also represented. As is evident from the previous order of December 15, 2017, the purchaser had raised his bid for the first lot to Rs.15 lakh; had attempted to match the price quoted by the appellant for the second lot by offering Rs.60 lakh against the appellant''s Rs.65 lakh; and, had matched the appellant''s offer of Rs.15 lakh for the third lot of land.
The order dated December 15, 2017 required the appellant to furnish a further deposit of Rs.7 lakh in lieu of the bids made in respect of the three lots of land. The appellant now claims that the appellant is not interested in purchasing the first lot of land, but is interested in the two other lots. The appellant also submits that instead of the further earnest deposit of Rs.7 lakh, the appellant had attempted to deposit a sum of Rs.4 lakh with the official liquidator, which the official liquidator, understandably, declined to accept since an order of this Court required a sum of Rs.7 lakh to be deposited.
The purchasers say that since the further earnest deposit has not been made by the appellant, whatever may be the excuse, the Court should disregard the offers and allow the order impugned to stand.
There are several reasons why the order impugned cannot be permitted to stand at the stage, not the least of them being that even the purchaser has acknowledged that the prices that he had originally offered for the three lots of land were wholly inadequate. This clearly reveals the perfunctory manner in which the sale was conducted by the company Court and such sale cannot be permitted to stand.
Since the appellant does not show any further interest in the first lot of land, the sale of the first lot of land is now confirmed in favour of purchasers Arabindo Majumdar and Nani Gopal Mondal at Rs.15 lakh. Subject to the additional amount of Rs.5 lakh being tendered by the purchasers within four weeks from date, the sale of the first lot of land will stand confirmed in favour of the said purchasers. In default of such payment being made within the time permitted, the sum of Rs.10 lakh already deposited may stand forfeited.
The sale of the second lot of land is confirmed in favour of the appellant Joydeb Biswas at Rs.65 lakh, subject to the entire balance consideration (total consideration less Rs.12.5 lakh tendered by way of earnest deposit) being paid within four weeks from date. In default of such payment being made within the time as permitted, the sale of the second lot of land will stand confirmed in favour of purchasers Mumtaz Ul Haque and Nani Gopal Mondal at Rs.60 lakh, subject to the balance consideration being tendered by the said Haque and the said Mondal within one week of receipt of the official liquidator''s demand in such regard. In default, further directions will be sought by the official liquidator from the company Court.
The sale of the third lot is confirmed in favour of the original purchasers identified by the company Court, Mumtaz Ul Haque and Nani Gopal Mondal, at a price of Rs.15 lakh. The highest price offered by the appellant is Rs.15 lakh, but it is the general rule that a previously identified highest bidder has to be outbid by a challenger or the highest bid of the previously acknowledged highest bidder would remain. Accordingly, the bid of Rs.15 lakh put in by original purchasers Mumtaz Ul Haque and Nani Gopal Mondal for the third lot is confirmed, subject to the balance payment being made to the official liquidator within four weeks from date. In default, the official liquidator will seek directions from the company Court.
Upon the full payments being tendered, the official liquidator will hand over draft deeds of conveyance within four weeks therefrom and proceed expeditiously to complete the execution of the deeds of conveyance. In default of the purchasers or the appellant paying in the requisite payments within the times indicated, the amounts already deposited may be forfeited.
APO No.493 of 2017 and ACO No.112 of 2017 are disposed of as above. There will be no order as to costs.