ANAND FINANCE PRIVATE LIMITED Vs. BANK OF BARODA

JUDGEMENT

(1.) This appeal by the Company arises from the order of the learned single Judge rejecting the application of the Company under order 34 rule 5 Civil Procedure Code and confirming the sale of the Company's property in question namely, 88 Sunder Nagar, New Delhi in favour of M/s Amarjit Singh Johar & Company (hereinafter referred to as 'the auction purchaser').

(2.) The relevant facts for the purpose of this appeal are that the Company besides being indebted to a large number of other creditors also owed a sum of approximately rupees ten lakhs to the Bank of Baroda (hereinafter referred to as 'the Bank'). The said debt was secured in January 1966 by an equitable mortgage being created of property No. 88 Sunder Nagar, New Delhi. The said property was at one time claimed to be the personal property of its then Managing Director Shri R.L. Anand but it is admitted that now the property is that of the Company.

(3.) Two proceedings were originally initiated against the Company. One was for its winding up being Company Petition No. 34 of 1966. Another petition under Sections 391 and 392 of the Companies Act for sanctioning scheme of arrangement was also filed being Company Petition No. 42-D of 1966. During the pendency of those proceedings the secured creditor namely the Bank and the Company arrived at a compromise. On the basis of the said compromise Shankar J. passed an order on 10th May, 1968 in G.A. 86 of 1968. As per as the said order recording the compromise it was agreed that the Company would make payment within the stipulated period but in case the payment was not made the Bank would be entitled to realise the agreed amount by the sale of the said property. It may be mentioned that the application under Sections 391 and 392 being C.P. 42-D of 1966 was eventually sanctioned by Andley, J. on 29th July 1968.