LexMANOJ I NAIK &ASSOCIATES versus OFFICIAL LIQUIDATOR
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[2014] 13 S.C.R. 1 MANOJ I NAIK &ASSOCIATES A v. OFFICIAL LIQUIDATOR (Special Leave Petition (Civil) Nos. 34782~34783 of 2012) B OCTOBER 28, 2014 [DIPAK MISRA, R. F. NARIMAN AND UDAY UMESH LALIT, JJ.] Companies Act, 1956 - Auction sale of properties C owned by liquidated company - Price fixation - Judicial intervention - Held: When properties of a company under liquidation are 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 credi~ors - It D has its own public character - In any case, it cannot be allowed to be sold for a song. Ram and Shyam Company v. State of Haryana 1985 (1) Suppl. SCR 541 : 1985 (3) SGC 267; E Committee of Management of Pachaiyappa's Trust v. Official Trustee of Madras and Another 1993 (3) Suppl. SCR 110: 1994 (1) sec 475; _ Chenchu Rami Reddy v. Govt. of A. P. 1986 (1) SCR 989 : 1986 (3) SCC 391; Mee rut F Development Authority v. Association of Management Studies and Another 2009 (6) SCR 663 : 2009 (6) SCC 171- referred to. Wayde's treatise on Administrative Law G Administrative Law, 91h Edn., H.W.R. Wade & C.F. Forsyth - referred to. H 1 T 2 A B c SUPREME COURT REPORTS [2014] 13 S.C.R. Case Law Reference: 1985 (1) Suppl. SCR 541 referred to Para 9 1993 (3) Suppl. SCR 710 referred to Para 11 1986 (1) SCR 989 referred to Para 11 2009 (6) SCR 663 referred to Para 12 CIVIL APPELLATE JURISDICTION: SLP (C) Nos. 34 782-34 783 of 2012. From the Judgment and Order dated 24-08-2012 and 30-08-2011 of the High Court of Gujarat atAhmedabad in MCA No. 77of2012inOJANo.81 of2004inOLRNo.100of2003 and in OJA No. 81 of 2004 in OLR No. 100 of 2003 in OLR D No. 24 of 2002. A. Saran, Sr. Adv., Amit Kumar, Ms. Rekha Bakshi, Shaurya Sahay for the Petitioner. Tushar Mehta, ASG, A. K Srivastava, C. R. Singh, Shyam E Divan, Shirish H. Sanjanwala, Sr.Advs .. Braj Kishore Mishra, Ms. Aparna Jha, Abhishek Yadav, Ejaz Maqbool, Mrigank Prabhakar, GauraveAgrawal,A. L. Shah, R. Shaa, P. Soma Sundaram, David Rao, Amar Dave, Pradhuman Gohil, Vikas Singh, Ms. Taruna Singh Gohil, Ms. Jaikriti Sinh Jadeja, Ms. F Prabuddha Sharma, Amit Anand Tiwari, Avinash Tripathi, Shamik Sanjanwala, Kailash Pandey, Ranjeet Singh, K. V. Sreekumar, E. C. Agrawala, Ankur Saigal, Mahesh Agarwal, Vivek Singh for the Respondent. G The Judgment of the Court was delivered by DIPAK MISRA, J. 1. The factual exposition that is capable of being encapsulated in a real small compass, has, with some_ passage of time and turn of events, grown into a H colossal structure having the effect potentiality to amaze and MANOJ I NAIK &ASSOCIATES V. OFFICIAL LIQU.IDATOR 3 [DIPAK MISRA, J.] perplex any prudent man. The chronology of events pyramids A a gradual financial structure, making it limpid·how on certain occasions properties are sold for a song in so called sales made in the proceedings under the provisions of the Companies Act, 1956 (for brevity 'the Act') and how with some intervention the said competitors metamorphose themselves B into different incarnations, and the roses on the table turn into pearls and diamonds in the private closets. To put it succinctly, the price fixed at Rs.6.25 crores for 291 plots has fetched, by the intervention of this C?urt, Rs.70 crores for 113 plots. It is not change of heart, but the price reality that gets manifest. C Not for nothing it has been said, "money can solve the problems concerned with money". The large amount of money, we are incli~ed to think, would solve the problems of the company in question. D 2. The short narration. A company, namely, M/s Vitta Mazda Ltd. went into liquidation and on 21.02.2002, the High Court of Gujarat directed the Official Liquidator to put up the properties of the company in liquidation (exceptthose for which applications are pending before the said Court for E regularisation of transactions) to auction for sale. Thereafter many an order was passed. On 18.12.2004, the learned Company Judge, by taking into consideration many aspects, declined to accept the rerort of the Official Liquidator for acceptance of the offer made before the sale Committee. An F appeal was preferred being O.J. Appeal No. 81 of 2004, wherein the Division Bench of the High Court on 30.08.2011 passed the following order: "1. The present appeal arises against the order dated G 18.12.2004 p.assed by the learned
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