Indistock Financial Services Pvt. Ltd v. Liquidator, Pertrofils Co-Operative Ltd. and Ors

order as to costs.

S. RAVINDRA BHAT (JUDGE)

DEEPA SHARMA (JUDGE) JULY 21, 2016

Page 1 * IN THE HIGH COURT OF DELHI AT NEW DELHI Reserved on: 18.04.2016 Pronounced on: 21.07.2016 + W.P.(C) 1993/2014, C.M. NOS. 4164/2014 & 20376/2014 INDISTOCK FINANCIAL SERVICES PVT. LTD. …………Appellant Through: Sh. A.K. Vali with Sh. Ramesh. N. Keswani, Sh. Bharat Manuberwala and Sh. Tuhin, Advocates. Versus LIQUIDATOR, PETROFILS CO-OPERATIVE LTD. AND ORS. ……..Respondents Through: Mrs. Manisha. L. Shah with Sh. Rohan Lav Kumar, Advocates, for Respondent Nos. 1 and 4. Sh. Bhagvan Swarup Shukla, CGSC for UOI with Sh. Rachit Goel, Advocate. CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MS. JUSTICE DEEPA SHARMA MR. JUSTICE S. RAVINDRA BHAT % 1. The petitioner, by these proceedings under Article 226 of the Constitution of India, seeks a direction for quashing the decision of the respondents cancelling its bid to purchase the Naldhari Plant, Valia, Dist. Bharuch, owned by the Petrofils Co-operative society, which was directed to be wound up. Page 2 2. The facts necessary to decide the case are that an order was passed by the Government of India (GoI) and Central Registrar of Co-operative Societies on 11.04.2001 under Section 77(1) read with sub-section (1) of Section 80 of the Multi-State Cooperative Act, 1984 for winding up of Petrofils Co-operative Limited ("PCL") and appointing its Liquidator. Pursuant to the winding up of PCL, its assets were to be sold by the Liquidator; these assets included the Naldhari Plant, Valia, Dist. Bharuch. The Liquidator issued an advertisement published in the Indian Express, for the sale of the plant through tender. The total land area was 6,24,970 Sq Metres; the terms of the tender were: firstly the tender was for the land as well as the plant and machinery. Secondly, the last date for submission of the bid was 23.04.2013. The EMD requirement was `5 Crores. Thirdly, the sale was to be on "AS IS WHERE IS WHATEVER THERE IS BASIS". Fourthly the successful bidder had to execute a sale agreement within a period of 30 days of full and final payment for the property. Fifthly, the price of the property was ` 98.50 Lakhs; 50% of the upfront amount was to be deposited by the successful bidder within 60 days from the letter of offer and the remaining 45% was to be by a bank guarantee. 3. As the tender did not elicit any response, the time limit for submission of the bid was extended further, initially to 10th May 2013 and thereafter to 27th May 2013 with the Asset Sale Committee reserving discretionary rights to confirm the first valid tender received on or after 10th May 2013. The Petitioner forwarded its tender (No. 639) for the sale of the plant, together with a demand draft of `5 crores, towards EMD, dated 10th May, 2013, in favour of the Liquidator. The petitioner's bid was for `98.55 crores net of liabilities, for (i) land and building admeasuring 154Acres (bid amount of ` Page 3 36.71 crores), (ii) Plant &Machinery, Furniture, Fixtures and Fittings (excluding leased assets) ` 59.75 crores, (iii)Stocks/Inventories ` 24.50 lakhs, (iv) leased property `1,84,50,000/-, making a total of `98.55 crores for sale on "AS-IS-WHERE-IS WHATEVER-THERE-IS-BASIS". On 13th June, 2013, the Liquidator, PCL communicated the acceptance, by the Asset Management Committee of the petitioner's "offer at the quoted price of Rs.98.55 Crores net of liabilities". The petitioner, on 5th August, 2013 acknowledged the receipt of the approval and reiterated that it would not be responsible for liabilities upto the date of transfer. In reply, the PCL stated, inter alia, that: "…we once again reiterate that the sale of the property is inclusive of liabilities as per tender document. Kindly be informed that Liquidator is a Quasi Judicial Authority empowered to settle all the issues as per the provisions of MSGS Act. All the necessary formalities required on the appointment of Liquidator pertaining to Liquidation were carried out as per the Statute. The modalities to he adopted in tackling and settling the issues with various A