TELANGANA STATE INDUSTRIAL INFRASTRUCTURE CORPORATION LIMITED Vs. M/S LAMINO PAPER PRODUCTS LIMITED

JUDGEMENT

(1.) These Original Side Appeals preferred under Clause 15 of the Letters Patent are directed against the order and judgment rendered by the learned Company Judge in Company Applications No. 767 and 1225 of 2013.

(2.) The appellant is Telangana State Industrial Infrastructure Corporation Limited, a public sector undertaking entrusted with the task of providing industrial infrastructure for securing rapid industrialization and economic growth. The 1st respondent in O.S.A.No. 21 of 2015 is a company under liquidation. One of the debtors of the said company initiated winding up proceedings against it by instituting for the said purpose Company Petition No. 14 of 2000. After due enquiry and upon being satisfied that the company is not in a position to liquidate its debts, the Company Court, by its order, dated 08.12.2001, ordered for its winding up. It is pursuant to the said order, the Official Liquidator has taken charge of its assets, books of records and deeds and started taking steps for liquidating the company. An industrial shed standing on a plot of land of the company was sold, in that process, in favour of the 2nd respondent M/s Haryana and Steel Center (KDM) Private Limited, who emerged as the best bidder for a sum of Rs.69.50 lacs. When the Official Liquidator was taking steps to liquidate the said industrial plot, it should be noted that the Andhra Pradesh Industrial Infrastructure Corporation Limited, the fore -runner and predecessor -in -interest of the present appellant when the combined State of Andhra Pradesh was in existence, filed Company Application No. 622 of 2006 seeking leave of the Company Court for resumption of possession of the industrial shed bearing No. D - 74 of a plinth area of 30 x 60 standing on an industrial plot measuring 1416.85 square yards in Phase -V, Industrial Development Area, Jeedimetla, Ranga Reddy District. That Application No. 622 of 2006 was dismissed on merits by the Company Court on 01.08.2006. It is thereafter, the asset has been liquidated.

(3.) Company Application No. 767 of 2013 has been moved seeking a direction to the Andhra Pradesh Industrial Infrastructure Corporation Limited (APIIC), Hyderabad to execute a sale deed in favour of the 2nd respondent purchaser. The background fact relevant is that the APIIC has allotted an industrial shed standing on a plot of land in Phase V, IDA, Jeedimetla in favour of the company under liquidation. The APIIC has also executed a registered lease -cum -agreement of sale deed on 14.02.1985 and in pursuance thereof, vacant possession was delivered of the industrial shed together with the land appurtenant thereto on 13.03.1985 to the company under liquidation. When the company under liquidation proposed to raise financial support by way of creating charge/mortgage on the said industrial plot, APIIC tendered No Objection Certificate on 13.03.1985 in favour of the Andhra Pradesh State Financial Corporation (APSFC) and accordingly, the industrial plot has been mortgaged in favour of the APSFC and the company under liquidation availed the financial support offered by the APSFC. However, in spite of the No Objection Certificate granted in favour of the APSFC on 13.03.1985, the APIIC cancelled the allotment of the industrial shed on 06.11.1986 and requested the company under liquidation to surrender possession of the industrial plot. However, most crucially, the APIIC has received payment affected by the APSFC in a sum of Rs.1,17,550/ - and a further amount of Rs.28,019.90 Ps. representing the sale consideration amount of the shed together with outstanding interest amount receivable by the APIIC. Upon receipt of this money, the APIIC has gone on record by addressing a communication on 09.06.1987 to the company under liquidation offering to restore the allotment, subject to payment of a sum of Rs.1,000/ - representing the nominal penal charges leviable for restoration of allotments, which stood cancelled earlier. The whole controversy now generated is that this amount of Rs.1,000/ - representing the penal costs has not been tendered by or on behalf of the company under liquidation. Hence, the successor body of APIIC, namely the appellant herein, would urge that the allotment of the industrial plot and shed in favour of the company under liquidation stood cancelled as long back as on 06.11.1986 itself and hence, the Company Court could not have ordered the appellant to execute a sale deed. The learned Advocate General assisted by Sri P. Roy Reddy, learned Standing Counsel for the appellant would also urge that the industrial plot was not sold in favour of the company under liquidation. It was merely leased out and an agreement of sale was only entered into. Therefore, while liquidating the assets of the company under liquidation, the Official Liquidator could not have transferred anything better than the title that was held by the original allottee, namely the company under liquidation.