HIGH COURT OF GUJARAT
Indian Oil People’s Cooperative Group Housing Ltd.
Versus
Official Liquidator in Charge of Ahmedabad Manufacturing
Co. Application No. 507 of 2011
Official Liquidator Report No. 137 of 2010
July 19, 2012
JUDGMENT
1. The present Judge’s Summons dated 19.10.2011 have been taken out by the applicant – Indian Oil People’s Cooperative Group Housing Limited (“the Society” for short), a registered Society, having been incorporated as a Housing Society by the employees of Indian Oil Corporation. The prayers made by the applicant are as follows:
“(A) This Hon’ble Court may be pleased to direct the Official Liquidator and the GIDC to clarity that in respect of lot No. VA, sale whereof has been confirmed in favour of the applicant, the area of land situated at Survey No.295, Village Undera, GIDC, Nr. P.T. Township, Phase-II, Vadodara, is admeasuring approximately 13759 sq. meters, alongwith construction of ‘A’ type and ‘C’ type quarters.
(AA) That in view of the act that land admeasuring 13759 sq. mtr. of Survey No.295, for which bid of the applicant was accepted, is not available for sale, this Hon’ble Court may be pleased to set aside the sale as confirmed under order dtd.18/7/11 and be further pleased to direct the Official Liquidator to refund the amount paid by the applicant along with interest at the appropriate rate as deemed fit by the Hon’ble Court.
(B) That this Hon’ble Court may be pleased to direct the Respondent No.2 GIDC to clarify and state that the aforesaid Lot No. VA admeasuring approx 13759 sq. mt. Of land is unencumbered, and that the company in liquidation is the lessee with regard to the said land admeasuring approx 13759 sq. mt.
(BB) That this Hon’ble Court may be pleased to initiate proper inquiry into the manner in which the office of the Official Liquidator auctioned the property in question, without ascertaining the correct status of the land in question.
(BBB) That this Hon’ble Court may be pleased to direct the Official Liquidator to formulate proper procedure to ensure that in future, before the property is to be auctioned, proper inquiry/ investigation is carried out with regard to auctioned property, so that the bidders and the ultimate purchasers are not put to hardship and inconvenience, as in the present case.
(c) That this Hon’ble Court may be pleased to direct the respondents to provide the copy of the lease deed executed by the GIDC in favour of the company in liquidation as also full set of title deeds/ documents relatable to Lot No. VA.
(D) That pending the aforesaid clarification by the respondents, time to deposit the balance consideration of 75 per cent, may kindly be extended.
(E) Any other and further relief which is just and proper may kindly be granted by this Hon’ble Court.”
2. An Affidavit in support of the Judge’s Summons has been filed by the applicant, dated 19.10.2 011. It is stated therein that Ahmedabad Manufacturing and Calico Printing Mills Limited (in Liquidation) [hereinafter referred to as “the Company in liquidation”], was ordered to be wound-up by order dated 20.04.1998 passed in Company Petition No.157 of 1995. The Official Liquidator attached to this Court was appointed as Liquidator of the Company in liquidation. Pursuant thereto, the Official Liquidator initiated steps to publish an advertisement in prominent daily newspapers in Gujarati and English.
3. It is the case of the applicant that the advertisement published by the Official Liquidator describes the property in question as Lot No. VA, admeasuring approximately 13759 square metres along with construction of ‘A’ type and ‘C’ type quarters at Survey No. 295 of Village Undera, GIDC, Near P.T. Township, Phase II, Vadodara. Various offers from bidders were received. The applicant-Society, whose members are employees of Indian Oil Corporation, made its bid to purchase Lot No. VA. The offer of the applicant for an amount of Rs. 11.96 crores was accepted by the Court, vide order dated 18.07.2011 made in Official Liquidator’s Report No. 137 of 2010. The applicant-Society was desirous of constructing residential houses on the said parcel of land in the name and style of “Indian Oil People’s Cooperative Housing Society Limited”. The applicant being the highest bidder, the sale was confirmed in its favour for an amount of Rs. 11.96 crores. The applicant was called upon to pay 25% of the sale consideration within one month from the date of the order dated 18.07.2011. Pursuant thereto, the applicant deposited an amount of Rs. 2.99 crores, being 25% of the sale consideration. It is further stated in the affidavit that after making the payment as above, the applicant contacted respondent No. 2-Gujarat Industrial Development Corporation (GIDC) to obtain the relevant documents, namely, the Lease Deed in favour of the Company in liquidation. However, respondent No.2 did not provide these documents to the applicant. The applicant, therefore, made efforts to gather the relevant revenue record and came into possession of Village Form No.7/12, wherein the name of IPCL has been bracketed in the Column of second charge, and, the name of Reliance Industries has been inserted. As the applicant was not informed regarding the second charge on the land in question, nor the effect of such an entry, it addressed a letter dated 29.09.2011, to the Official Liquidator, requesting for a copy of the Lease Deed in favour of the Company in liquidation, as well as a copy of the full set of title deeds/documents relating to Lot No. VA. The Official Liquidator did not respond to the request of the applicant and did not forward the title deeds/ documents relating to Lot No. VA. In these circumstances, the applicant has taken out the present Judge’s Summons, making the prayers reproduced hereinabove.
4. In order to appreciate the factual position and the seriousness of the matter, a brief chronology of events and details of various interim orders passed by this Court in the present application, would be necessary :
5. This Court (Coram: K.M. Thaker, J. ) issued notice to the respondents on 20.10.2011.
6. Thereafter, this Court (Coram: K.M. Thaker, J.) passed an order dated 02.12.2011, containing specific directions to the Official Liquidator and GIDC, including that of filing a Report/ affidavit, giving relevant details regarding the title, possession and ownership of the land bearing Survey No.295.
7. On 15.12.2011, Mr. Manish R. Bhatt, learned Senior Advocate for the applicant submitted before the Court that there appear to be serious errors or irregularities on a large scale, inasmuch as, according to the advertisement, about 13759 square metres of land of the ownership of the Company in liquidation was available for disbursement. Even according to the Sale Confirmation Order, land admeasuring 13759 square metres has been sold and 25% of the total sale consideration has been recovered from the applicant towards sale of the land in question. It has now come to the notice of the applicant that land to the extent of 13759 square metres is not available at all, as it was not under the ownership of the Company in liquidation. What is available are only two small parcels of land. These submissions have been recorded in order dated 15.12.2011 of this Court (Coram: K.M. Thaker, J.). It has further been recorded in the said order, as below:
“…. In the present case, though notice was ordered to be issued on 20/10/2011, OL has, though almost two months have passed, not filed any report and placing on record that what steps and precautions have been taken by office of OL before the advertisement for sale of land in question and before issuing tendered as well as before holding an auction process. In light of which, the Court was led to believe that measurement of the land is about 13,759/- sqmt and accordingly sale confirmation order was passed.
It is unfortunate that despite the fact that two months’ time is passed, OL has still not filed the report. The OL has taken the matter very lightly and no steps, which require urgency, have been taken.
As a last chance, time until 19/1/2012 is granted.
In the meantime, OL shall, without any default place on record entire details of the steps and precautions taken before disposing the land in question by way of auction sale by virtue of sale confirmation order dated 18/7/2011.
The respondent GIDC also shall take steps to place on record entire history from the Revenue record as well as its record, so far as land in question are concerned and clarified the details regarding title of ownership of land bearing survey no. 295, out of which, the land in question has been sold to the applicant.
Having regard to the facts and circumstances of the case, request made by learned advocate for the applicant that OL may be directed to EMR the amount received from applicant society and maintain it separately. Under this circumstances, OL is directed to EMR the said amount separately and if find necessary to deposit such amount in short term fixed deposit of period of forty five days or sixty days as may be considered appropriately in Nationalized Bank.
S. O. to 19/12/2011.”
8. Pursuant thereto, GIDC filed its reply dated 19.12.2011. It is, inter alia, stated as below:
“3. I submit that in light of the said prayers as prayed in the application the Hon’ble Court was pleased to issue direction to GIDC to file reply. It is submitted that on going through the records available with GIDC for the land bearing Survey No.295, necessary request was made by Calico Chemicals & Plastic division for housing quarters and forms were submitted to GIDC on 10.02.1972. That in light of the applications GIDC was pleased to allot 6-A,10-B (Block-1) and 16-C (Block No.6) type housing quarters at southern township on the basis of certain conditions on 29.03.1972. A copy of the possession receipt is duly annexed with reply and marked as Annexure-R1.
4. It is submitted that in light of the said allotment of the housing quarters it was agreed between GIDC and the concerned unit to enter in hire purchase agreement and accordingly several inter se correspondence were made regarding the terms and condition of the offer and agreement and as per the noting of GIDC hire purchase agreement came to be executed on 29.09.1972. A copy of the proforma of the said agreement is duly annexed herewith this reply and marked as Annexure-R2.
5. It is further submitted that in light of the said agreements made since the concerned unit wanted to give common amenities to the occupants of the said unit since IPCL was also allotted the certain blocks and inter se exchange agreement of the possession of 16 tenements of Block C-3, type tenements with 16 tenements of Block-B came to be executed with consent of GIDC. A copy of the supplementary agreement executed between GIDC and unit is duly annexed herewith this application.
6. It is submitted that in light of the said exchange plot No. 10 and 11 at southern Township of Petrochemicals complex was allotted to IPCL vide communication letter dated 20.06.1988. It is submitted that land comprising survey No.295/p admeasuring 8000 sq. mtr at village Undera, Baroda was allotted to IPCL. A copy of the said letter dated 20.06.1988 is duly annexed herewith this application and marked as Annexure-R3.”
9. Thereafter, the Official Liquidator filed Report dated 19.12.2011. The said Report was not found to be satisfactory by the Court, therefore, the Official Liquidator was directed to file another Report on, or before, 26.12.2011, giving all the details required by the order dated 20.12.2011.
10. The Official Liquidator filed another Report dated 28.12.2011. In the said Report, it is stated thus:
“2. That, consequent upon the winding up order, the Official Liquidator deputed his representative to the Office of the Registrar of Companies, Gujarat Ahmedabad for taking inspection of records of the subject company to find out assets and properties, liabilities, addresses of Registered office of the company and Secured Creditors. That, the Official Liquidator most respectfully submits that dates on which possession of the Assets and Properties were taken over by the Official Liquidator are as under:-
