- (1.) Heard Sri J. Nagar, Senior Advocate, assisted by Sri Prateek J. Nagar, learned counsel for M/s Cosmos Technologies, Post Office Renuekoot, District Sonbhadra on Application No. 269043 of 2014 filed under Rule 6 and Rule 9 of the Companies (Courts) Rules, 1959. In the application, the applicant has prayed to recall the order dated 30th July, 2014 and permit the applicant to bid for sale of plant and machinery of the company (In liquidation). In paragraph no. 2, 3, 4 and 5 of the affidavit accompanying the said publication, the applicant has stated as under :- "2. That the Hon'ble Court by its order dated 30.7.2014 was pleased to sell plant and machinery of the company ( In Liquidation) to M/s Star Trading Company for a sum of Rs.97,00,000/- ( Rupees Ninety- Seven Lacs). 3. That the applicant is prepared to purchase the plant and machinery for a sum of Rs.1,10,00,000/- ( Rupees One Crore and then lacs). In order to prove its bonafide, the applicant -company is depositing with the Official Liquidator a sum of Rs.25,00,000/- ( Rupees Twenty Five Lacs) by Demand Draft No. 978038 dated 14.8.2014, drawn in favour of the Official Liquidator, U.P., Allahabad, on the State Bank of India. 4. That the price offered by the applicant is higher than the price offered by M/s Star Trading Company. Further, the applicant is prepared to deposit the balance amount of Rs.85,00,000/- ( Rupees Eighty-Five Lacs) within three days from the acceptance of his offer. 5. That it is expedient in the ends of justice that the Hon'ble Court be pleased to recall its order dated 30.7.2014 and permit the applicant to bid for sale of plant and machinery of the company, Alfa Springs Limited ( In liquidation) and for this act of kindness the applicant as is duty bound shall always pray."
(2.) Sri J. Nagar, Senior Advocate, assisted by Sri Prateek J. Nagar, learned counsel for M/s Cosmos Technologies has produced in Original the Bank Draft No.978038, dated 14th August, 2014, of Rs.25,00,000/- of State Bank of India, Renukoot Branch drawn on Allahabad Branch. Sri J. Nagar, Senior Advocate states that the applicant undertakes to offer a minimum of Rs.1,10,00,000/- for Lot-B in respect of which auction took place on 16th July, 2014 and in which the bid of M/s Star Trading Company for Rs.97,00,000/- was found to be highest. He states that the applicant undertakes to deposit remaining Rs.85,00,000/- of his minimum offer during the course of day failing which the aforesaid amount of Rs.25,00,000/- of the aforesaid bank draft may be forfeited. He further states that the applicant undertakes to offer minimum bid of Rs.1,10,00,000/- and in case the applicant either does not participate or does not make minimum offer of Rs.1,10,00,000/- then the entire money of Rs.1,10,00,000/- deposited by the applicant to show his bonafide, may be forfeited for which the applicant shall have no objection of any kind whatsoever.
(3.) In support of his submission, he relies upon an order dated 6.9.2011 passed by this Court in Company Petition No. 44 of 1999 in the matter of M/s Rajendra Steel Limited in which after bidding took place and the highest bidder had deposited the entire amount a application was submitted by M/s Pearless Consultancy Services Pvt. Ltd. through Shri N.R. Bachhawa making offer of Rs.15,05,15,000/- as against the highest bid of Rs.13.10 crore. The increase made in the said offer/ application by Sr. R.N. Bachhawa was about 13%. On these facts, this Court observed and allowed the bidding between Sri N.R. Bachhawa and the highest bidder after observing as under : - "Reference orders dated 15.7.2011 and 20.8.2011, the highest bid of M/s Aslina Builders & Developer Pvt. Ltd., of Rs. 13.30 crores for Lot No.II (Industrial leasehold land of M.I.D.C. Plot No. 17, Road No. 9, MIDC, Roral Andheri (E), Mumbai area 1000 square meters and building constructed thereon) as against the reserved price of Rs. 12.62 crores, was accepted in the competitive bidding in which out of eight initial bidders, two parties, namely M/s Westin Construction Pvt. Ltd and M/s Aslina Builders & Developer Pvt. Ltd. participated. After adjusting the earnest money, the entire amount was to be deposited within 90 days. M/s Aslina Builders & Developer Pvt. Ltd. deposited the entire balance amount upto 9.8.2011. Shri N.R. Bachhawat, appearing through Shri Anil Kumar Mehrotra made an application dated 27.7.2011, along with demand draft dated 21.7.2011 of Rs. 31, 550, 000/- and made an offer of Rs. 15, 05, 51,000/-. The offer was received before the highest bidder had deposited the balance amount. The Court found that ordinarily such offer, after the highest bid has been accepted, should not be entertained, but that the Court is also required to protect the interest of the stakeholders in the company (in liquidation), and should endeavour to obtain the best price. The Court thus gave an opportunity to Shri N.R. Bachhawat, to deposit the entire offered amount, to consider the bonafides of the offer. Shri Ashok Mehta, learned counsel appearing for Official Liquidator informs that Shri N.R. Bachhawat representing Pearless Consultancy Services Pvt. Ltd has, in pursuance to the opportunity given by the Court on 20.8.2011, has deposited a demand draft no. 266636 dated 3.9.2011 for Rs. 119,001,000.00 in favour of Official Liquidator, U.P. & Uttrakhand in the account of M/s Rajendra Steels Ltd (in liquidation) drawn at Standard Chartered Bank. Shri Ashok Mehta appearing for Official Liquidator states that the draft has been received. Shri A.K. Gaur has entered appearance on behalf of M/s Aslina Builders & Developer Pvt. Ltd., Mumbai. He has raised an objection to the offer made by Shri N.R. Bachhawat. He submits that once the highest bid of M/s Aslina Builders & Developer Pvt. Ltd. was accepted and the entire amount of the bid of Rs. 13.30 crores was deposited, the Court should not entertain the offer of Shri N.R. Bachhawat. Every one was given an opportunity to participate in the auction proceedings. The confidence of the sale conducted by the Court and sanctity of the proceedings will be affected, if the offer is accepted, after the entire amount is deposited by the highest bidder. There must be some end to the bidding process. As observed in the order dated 20.8.2011, though ordinarily the order accepting the highest bid should not be disturbed as it may cause financial implication to the highest bidder, the Court is under statutory duty to obtain the best price of the asset of the company. In this case since the bid of Shri N.R. Bachhawat is 13% more than the highest bid accepted by the Court, and that the entire amount has been deposited showing his bonafides, it will be appropriate that the property be put to competitive bidding between M/s Aslina Builders & Developer Pvt. Ltd. and Shri N.R. Bachhawat. Shri A.K. Gaur, learned counsel appearing for M/s M/s Aslina Builders & Developer Pvt. Ltd. states that his client is prepared to offer an amount higher than the amount offered by Shri N.R. Bachhawat. Shri Santosh Kumar Srivastava appearing for M/s Westin Construction Pvt. Ltd. states that his client had participated in the competitive bidding on 15.7.2011. He is now prepared to offer Rs. 15.10 crores for the property. M/s Westin Construction Pvt. Ltd. has withdrawn the earnest money and thus its offer cannot be entertained by the Court. Let the matter be fixed again on 15.9.2011 at 03.00 PM for bidding between M/s Aslina Builders & Developer Pvt. Ltd. and Shri N.R. Bachhawat in chambers.";