IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
COMPANY APPLICATION No.375 of 2001
In
COMPANY PETITION No.126 of 1990
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PARVATIBEN NARANBHAI TANDEL
Versus
O.L. OF VITTA MAZDA LTD.(In Liquidation)
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Appearance:
1. COMPANY APPLICATION No. 375 of 2001
MR PK JANI for Applicant
MR RM DESAI for Opponent
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CORAM : MR.JUSTICE RAVI R.TRIPATHI
Date of Order: 02/05/2003
ORAL ORDER
1.The present application is filed by one
Parvatiben Naranbhai Tandel for directing the
opponent-Official Liquidator of M/s.Vitta Mazda Limited
to rectify the mistake in the notice dated 28th November,
1998 issued by him pursuant to the order passed by this
Court in Company Petition No.126 of 1990 on 27th August,
1990 and allow her to deal with Plot No.1 Sector No.2,
admeasuring 5037.67 sq.ft. (468 sq.mtrs.) of the N.A.
land bearing Survey No.78/57 situate within the limits of
Kathiria, Nani Daman in any manner she likes.
2.The facts of the case are that the applicant, who
is a resident of Parkota Sheri, Nani Daman, Daman (U.T.),
by a sale deed dated 7th February, 1994, which was
registered on 8th February, 1994 at the Sub Registrar’s
Office of Daman, a copy of which is produced at
Annexure-A to the application, purchased the aforesaid
property, that is, Plot No.1 in Sector no.2, admeasuring
5037.67 sq.ft. (468 sq.mtrs.) from the land bearing
Survey No.78/57 known as “Narayan Park”, along with the
rights of way, trees, easements and appurtenances to the
said plot.
3.The case of the applicant is that she was put in
possession of the land in question and she also made an
application to the Mamlatdar on 11th April, 1994 for
making necessary mutation entry in the revenue records, a
copy whereof is at Annexure-B to the application. It is
also the case of the applicant that she was enjoying
peaceful possession of the property since 1994 untill the
same came to be disturbed by notice dated 28th November,
1998. The possession of the properties and belongings of
the company was taken over by the Official Liquidator
after the said notice. The applicant, therefore, made a
representation to the Official Liquidator on 20th May,
2001 stating that she had purchased the said property
free from all encumbrances from M/s.Vitta Mazda Limited
by a registered sale deed and that she is in possession
thereof since then. The applicant made a request that as
she wants to sell the property for which she has an
intending purchaser who has promised to purchase at the
present market value which is Rs.2 lacs, the mistake may
kindly be rectified.
4.The Official Liquidator replied the said
representation by a communication dated 16th July, 2001
wherein it was stated that by an order dated 27th August,
1998 passed by this Court in Company Petition No.126 of
1990, the Official Liquidator attached to this Court is
appointed as the Liquidator of M/s.Vitta Mazda Limited,
which has gone into liquidation, and accordingly, as per
the directions of this Court, he has taken possession of
the available assets and properties of the company. It
was stated that as the Ex-Directors of the company have
not furnished any details of the assets and properties of
the company, the applicant may approach this Court to
obtain necessary orders. It is in this background that
the present application is filed.
5.Mr.P.K.Jani, learned Advocate appearing for the
applicant, strenuously contended that the applicant is a
bona fide purchaser and that she had purchased the
property for the consideration mentioned in the sale deed
and that she was in possession of the property since
1994, when the sale deed was executed.
6.On the other side, Mr.R.M.Desai, learned Advocate
appearing for the Official Liquidator, submitted that the
present application deserves to be rejected as the `sale’
of the property in question is not required to be
validated by this Court. He submitted that the
transaction is hit by the provisions of the Indian
Companies Act, 1956. Mr.Desai relied upon a judgement of
Madras High Court in the matter between The Andhra Bank
Limited vs. Provisional Liquidator, The Godavari Sugars
& Refineries Limited, reported in Comp.Cases Vol.XXIV
pg.149, wherein it is held that while making an order
under Section 227(2) of the Indian Companies Act [now
Section 536(2)] validating the disposition of property of
a company after it is ordered to be wound up, the Court
should bear in mind the fundamental principle that the
assets of the company should be made available for the
distribution pari passu amongst the creditors of the
company and that no creditor should obtain an advantage
over his fellow creditor. Mr.Desai submitted that the
Court was pleased to hold that it is for the applicant
creditor to establish as to why he should be preferred to
the general body of creditors and why the discretion of
the Court be exercised in his favour under Section 227(2)
(old). Mr.Desai submitted that what is most important is
that the Court was pleased to hold that whether or not
the creditor had knowledge of the presentation of the
petition for winding up is immaterial and that the
creditor was bona fide in having advanced sums of money
to the company is not sufficient.”
(emphasis supplied)
7.Mr.Desai, learned Advocate, also relied upon a
judgement of this Court in the matter of Rushvi Estate
And Investments Pvt. Ltd. vs. Official Liquidator of
Shri Ambika Mills Limited, reported in 2001 Comp.Cases
(Vol.105) pg.828, in support of his contention that if an
immoveable property of the company is sold without there
being any resolution authorising `sale agreement’, such
an agreement will amount to fraud. This Court was
pleased to hold that in case of purchase of property from
a public limited company, the first thing that a
purchaser is expected to look into is the audited reports
and have an inspection of the files of the company with
the Registrar of Companies, and ask for the statement of
accounts of such a company. If this is not done by any
of the purchasers, then, his pleas cannot be
entertained.
8.From the record of the case, it transpires that
the applicant has not produced a copy of the sale deed
and has only produced a copy of Form-`T’ bearing Serial
No.163/1994 dated 8th February, 1994 wherein the nature
of of document is described as “Sale Deed for
Rs.75,000=00”. Mr.Jani, learned Advocate for the
applicant, at this juncture, made available a copy of the
registered sale deed for perusal of the Court. On
perusal of the said sale deed, it is clear that it does
not have any reference of the mode of payment of the sale
consideration. Paragraph-1 of the document is relevant,
which reads as under :
“1.NOW THIS INDENTURE WITNESSETH THAT in
pursuance of the said agreement and in
consideration of the total sum of
Rs.75,000/(Rupees Seventy Five Thousand Only)
which is its fair Market Value paid by the said
PURCHASER to the said VENDORS, the VENDORS do
hereby admit and acknowledge the receipt thereof
and forever do acquit, release and discharge the
said PURCHASER forever and the said VENDORS do
hereby grant, sell, assign, release, convey and
assure unto the said PURCHASER free from all
encumbrances, forever the said land,……”
Mr.Jani could not render any explanation as to
why the sale deed does not contain the details of the
mode of payment of the consideration. Mr.Jani could not
gather any details of payment from his client also. The
Court had earlier granted time on 6th February, 2003.
9.From the aforesaid discussion, it is clear that
the Company Petition was filed in the year 1990 and the
order of winding up was passed on 27th June, 1998 while
the transaction is that of the year-1994 and though the
sale deed is registered one, it does not mention about
the mode of payment. This aspect goes to the root of the
matter. The applicant has not produced any material on
record which will help the Court to come to the
conclusion that the applicant is a bona fide purchaser.
In light of the two decisions cited by Mr.Desai, the
Court is of the opinion that the transaction in question
is not required to be validated, more so, when it does
not inspire confidence to grant the prayers of this
application. In the result, this application fails and
the same is dismissed. Notice is discharged. No order
as to costs.
(Ravi R. Tripathi, J.)
kamlesh*