S MARTIN Vs. BOARD FOR INDUSTRIAL FINANCIAL RECONSTRUCTION

JUDGEMENT

(1.) COMMON ORDER By consent of all the parties in these writ petitions the main writ petitions itself are taken up for disposal, since the issue involved in both the writ petitions are common and since the prayer is identical, they are disposed of by a common order.

(2.) The prayer in the writ petitions are to quash the order passed by the first respondent dated 07.10.2009 in M.A.No.149/BC/2009 in BIFR case No.103/1998 (Bench II) and to direct the first respondent to dispose of the BIFR case No.103/98 and M.A.No.149/BC/2009 on merits after hearing the entire objections of the petitioner. Though, there are several factual issues raised in both the writ petitions, since a consensus has been arrived by the parties to the present writ petitions, which has been expressed through their counsel, the following facts alone are required to be considered for disposal of the present writ petition.

(3.) The second respondent company, which was engaged in the manufacture and sale of yarn ran into problems resulting in seeking for a reference before the first respondent under the provisions of the Sick Industrial Companies (Special Provisions) Act 1985, for being declared as a Sick Industry. Based on such reference, the first respondent in its meeting held on 10.06.1998, declared the second respondent company as a Sick Industrial Company and appointed the State Bank of India as its operating agency. Subsequently, IDBI came to be appointed as an operating agency in the place of State Bank of India. After prolonged proceedings, one time settlement proposal was placed for the acceptance and since, funds were required for payment towards the OTS amount, it was decided to sell the property owned by the company. It is stated that the petitioner in Writ Petition No.25159/09 offered to purchase an extent of 10.66 acres of land comprised in S.F. No.462/2 465/22, 465/6, 466, 467 & 467/2, Sowripalayam Village and accordingly a sale agreement was also entered into on 07.06.2004. According to the petitioner, the amount to be paid under the agreement was for the purpose of effecting the one time settlement and the second respondent under looked to obtain necessary sanction and clearance from the first respondent. According to the petitioner, he was ready and willing to perform his part of the obligation under the agreement for sale, but he reliable learnt that the second respondent has been attempting the alienate the property to third parties. Therefore, the petitioner filed O.S.No.2066/05 on the file of the District Munisiff Court, Coimbatore, seeking for a permanent injunction to restrain the defendants from alienating the property. An application seeking for interim injunction was also filed in I.A.No.2427/05. I.A.No.94/06 was filed by the second respondent for rejecting the suit and the Trial Court dismissed the both the I.As by order dated 28.09.2006. The appeal filed by the petitioner in CMA No.90/06 before the Sub-Court, Coimbatore was dismissed on 05.03.2007. As against the said order, the petitioner has filed CRP. No.452/08 before this Court. It is stated that in the CRP, an additional counter affidavit was filed stating that the property in question was sold on 15.12.2006 to Ambatur Clothing Ltd, as per the order of the first respondent dated 06.12.2006. It is further stated by the petitioner that the first respondent by order dated 06.02.2006, granted permission to the second respondent for sale of the lands and other assets through an Asset Sale Committee. According to the petitioner, the said committee was constituted by the second respondent by colluding with some financial institution. Subsequently, the petitioner is stated to have assigned his rights under the sale agreement dated 07.06.2004 by a register deed of assignment dated 31.08.2009 in favour of Mr.S.Martin, the petitioner in W.P.No.25158/2009.