Full Judgment
2. Counsel for the respondent Bank submits that the appellants defendants were all along aware of the proceedings in connection with the auction and the Counsel for the appellants also sent many letters to the Bank and so it cannot be stated that the appellants were not aware of the Court proceedings. Counsel for the respondent Bank also submits that when the hearing was advanced to another date, even on that petition notice was sent to the party and this was returned as "Party left". Counsel for the appellants submits that the Counsel on record was very much available but no notice was sent to the Counsel on record.
3. It is seen from the records that Receiver was appointed by DRT-I, Chennai, for taking possession of the hypothecated goods on 4.10.2000 and the Receiver was put in possession of that property on the very same day. It is further submitted that sale of the hypothecated goods was also ordered on the very same day. Counsel for the appellants submits that the appellant filed petition to set aside the ex pane Order of appointment of Receiver and he obtained Order of status quo.
That Order is not produced before this Court. So as it is, Receiver is not alone is in possession of the hypothecated goods. The Order of appointment of Receiver is not yet set aside and the Order passed by the PO, DRT, Chennai, for appointment of Receiver still holds good.
Further, it is seen from the records that initially sale was ordered on 4.10.2000 and sale notice was published on 20.1.2001 and for that, upset price was fixed by the DRT-I, Chennai, at Rs. 12 lakhs. Tenders were received for that sale and since tenders received were below the upset price, sale could not take place. Then the case was transferred to DRT-II, Chennai, and then the case was transferred to DRT, Coimbatore, In DRT, Coimbatore, sale was ordered for the second time fixing the upset price at Rs. 20 lakhs. The PO, DRT, Coimbatore, received three tenders through the Receiver--(1) Jemini Ventures Private Ltd. of Rs. 21 lakhs and no EMD has been submitted, (2) Meenakshi (India) Ltd., for Rs. 39,15,000/- and EMD for Rs. 3,91,500/- has been submitted, and (3) Sh. P.P. Mathew Vattakunnel for Rs. 40,10,000/- and EMDs totalling Rs. 4.15 lakhs have been submitted. The PO, DRT, Coimbatore, in his Order has stated that the Counsel for the defendants also filed Memo along with the proposal addressed to the applicant Bank and the defendants prayed for keeping the opening of the tenders in abeyance. The PO, DRT, has ordered to keep those tenders intact till the disposal of the IA-137/2001 and IA-133/2003 or further orders of the Tribunal.
4. So, it is seen that even after tenders were received, the defendants have taken part and they have filed Memo before the DRT for keeping these tenders in abeyance, So, the defendants appellants were well aware of all the proceedings and they have also taken part in the auction proceedings. As the three tenders were received by the PO, DRT, and the offer of Sh. P.P. Mathew Vattakunnel was for the highest bid amount of Rs. 40,10,000/-, the PO, DRT, has accepted the tender offer by Sh. P.P. Mathew Vattakunnel and has ordered sale of Sh. P.P. Mathew Vattakunnel. The PO, DRT, has also granted two weeks further time for deposit of the auction amount and time was granted for depositing the balance amount and now the auction purchaser has paid the entire amount of Rs. 40,10,000/-.
5. At this juncture, it is also important to mention with regard to the Land Acquisition proceedings of the land on which the hypothecated goods are situated and the land have been acquired by the Government for the purpose of Mahindra Industrial Park Scheme. It appears that Writ Petitions were filed by the 2nd appellant with regard to the Land Acquisition proceedings and those Writ Petitions have been dismissed by the High Court of Madras. The Special Tahsildar (Land Acquisition) has also written letter to the Advocate Receiver on 14.5.2001 stating with regard to the land acquisition proceedings and has directed the Advocate Receiver to remove the plants and hand over the vacant possession within 15 days. On 12.6.2002 also, the Special Tahsildar (LA) sent letter to the Receiver asking the Receiver to hand over the land to Mahindra Industrial Park Ltd., by handing over the vacant possession. The Special Tahsildar has asked the Receiver to remove the plants and hand over the vacant possession within 7 days from the date of receipt of the letter. Again on 24.6.2002, the Special Tahsildar sent letter to the Advocate Receiver stating that in spite of directions given to the Receiver to hand over vacant possession of the land within 7 days from the date of receipt of the previous letter no reply has been received from the Receiver and so has requested the Receiver to hand over the vacant possession within 7 days from he date of receipt of that letter dated 24.6.2002 failing which action will be taken under Section 47 of the Land Acquisition Act.
6. Counsel for the appellants submits that writ appeal is pending in the High Court of Madras with regard to the land acquisition proceedings. This Tribunal is not concerned with the writ appeal in this regard. The Bank is interested only in the goods hypothecated to the Bank and the auction is also being conducted only for the hypothecated goods for which the Bank is entitled to. It appears from the records that sale was conducted twice. Originally the sale could not take place because the tenders received were below the upset price and again the upset price was increased to higher amount and the plants along with flowers and machineries stated therein were sold for the highest bid amount of Rs. 40,10,000/-. After observation of the formalities by fixing upset price and also by calling for tenders, the auction was conducted in proper manner. Counsel for the respondent Bank submits that the amount due from the appellants is more than Rs. 1,15,00,000/-.
7. It appears that the appellants are not making any payments at all.
Only the Receiver is in possession of the hypothecated goods for the past three years and is making payments. Now the Land Acquisition proceedings have also been taken and the Receiver has also been asked by the Special Tahsildar the Land Acquisition authority to hand over vacant possession of the land. Since the plant and machineries were hypothecated to the Bank, these hypothecated goods have necessarily to be sold by the Receiver and have been sold only to the highest bidder after calling for tenders. Counsel for the respondent Bank submitted that after the appellants asked for keeping the tenders in abeyance and the Court also kept these tenders in abeyance for a period of five months, the appellants never took any steps to bring the highest bidder, above the amount now sold in auction and all these times the appellants did not take any initiative to bring the highest bidder.
There are lapses on the part of the appellants. I find that the auction held is perfectly valid and justified. I find no infirmity in the Order and I see no ground to interfere in the auction proceedings.
9. Sale confirmed. Stay already granted confirming the sale is vacated.
Receiver is directed to hand over the hypothecated goods to the auction purchaser immediately. It appears that the Receiver is having the amount of Rs. 40,10,000/-. The Receiver is directed to deposit that amount immediately to the Bank in the loan amount of the appellants concerned in the OA.