THE PRADESH1YA INDUSTRIAL AND INVESTMENT CORPORATION OF U.P. LIMITED (PICUP) Vs. C.M. JAIN, EX-M.D. LA NEDICAL DEVISES LIMITED AND ORS.

JUDGEMENT

(1.) As identical questions of law and facts are involved, therefore, we propose to dispose of the aforesaid appeals, which have arisen out of the same impugned order, by this common judgment, in order to avoid the repetition. However, for facilitation, the bare minimum facts that need a necessary mention have been extracted from Company Appeal No. 1 of 2009.

(2.) The matrix of the facts, culminating in the commencement of, relevant for disposal of present appeals and emanating from the record, is that the appellant-Company The Pradeshiya Industrial and Investment Corporation of UP Limited (for short "the PICUP Company") incorporated under the Companies Act, 1956 (for brevity "the Act") had advanced a term loan of Rs. 90 lacs to M/s La Medical Devices Limited (hereinafter to be referred as "the LMDL Company"). In the wake of Company Petition No. 42 of 1999, the LMDL Company was ordered to be wound up by this Court, vide order dated 7.4.2004. An Official Liquidator was, accordingly, appointed. He ultimately took over all the assets of the Company. Thereafter, on the application of the Liquidator, learned Company Judge ordered the sale of its assets. After publishing the sale notice in the various newspapers, this Court confirmed the sale in favour of M/s FCS Software Solutions Limited for Rs. 1.47 crores, being the highest bid.

(3.) It was claimed that the original promoter of the Company feeling aggrieved by the said auction, as being much below the market value, filed objection petition i.e. CA No. 365 of 2004. On the said objections and application filed by others, the learned Company Judge, after noticing the bids of other bidders and the submission of original promoter for re-auction, directed the Official Liquidator not to hand over the possession of the property. Thereafter, the learned Company Judge ordered for re-advertisement to sell the property of the company (in liquidation) for a reserve price of Rs. 2.10 crores, vide order dated 16.2.2006. According to the appellant, needless to say that the previous auction purchaser M/s FCS Software Solutions Limited filed Company Appeal No. 10 of 2006 and a Division Bench of this Court, while issuing notice of motion to the respondents, directed that fresh offers, in pursuance of the advertisement, may be received, but the bid shall not be finalized. The property of the company was to be put to reauction under the orders of the Court, vide method of inviting tenders and ultimately highest bid to the tune of Rs. 3.50 crores was received from respondent No. 1, who was an Ex-Managing Director of LMDL company (in liquidation).