THE HON’BLE Ms. JUSTICE G. ROHINI COMPANY APPLICATION No.479 of 2010 IN COMPANY PETITION No. 48 of 1989 O R D E R : The Official Liquidator attached to this Court representing M/s. Mopeds India Limited, the company in liquidation filed this application seeking a direction to the respondent-Bank to handover possession of the land admeasuring Ac.0.29 cents 389 sq.ft. situated at Coimbatore. M/s. Mopeds India Limited was ordered to be wound up by this Court by order dated 17.10.1990 in C.P.No.48 of 1989 and the Official Liquidator attached to this Court was appointed as its Liquidator. Claiming that an extent of Ac.0.29 cents 389 sq.ft., of land at Krishnarayapuram village, Coimbatore Taluk belonging to the company in liquidation remained to be sold, the Official Liquidator by letter dated 27.04.2009 requested the respondent-Bank to furnish the status of the said property along with the relevant documents. The respondent-Bank by letter dated 16.07.2009 informed the Official Liquidator that the Debts Recovery Tribunal, Hyderabad in O.A.No.972 of 1999 issued a recovery certificate dated 11.04.2002 for a sum of Rs.19,97,80,404.82 ps., and that the memo filed by the respondent- Bank before the Recovery Officer, DRT, Coimbatore for attachment of the property in question is pending. The Official Liquidator gave a reply dated 22.9.2009 claiming that the property in question was not the subject-matter of the proceedings before the Debts Recovery Tribunal. In the meanwhile, the Recovery Officer, DRT Coimbatore by order dated 03.09.2009 ordered attachment of the property in question. The Official Liquidator by letter dated 5.11.2009 informed the respondent-Bank that they cannot proceed further without obtaining the permission of this Court. However the respondent Bank in its reply dated 08.12.2009 contended that it was not necessary to obtain permission of this Court. Hence, the present application seeking a direction to the respondent-Bank to obtain orders in the matter from this Court or in the alternative to hand over the possession of the property in question i.e. Ac.0.29cents 389 sq.ft., of land situated at Krishnarayapuram village, Coimbatore Taluk belonging to the company in liquidation. In response to the notice ordered by this Court, a counter affidavit has been filed by the respondent-Bank stating that the Bank had filed O.S.No.139 of 1990 against the company in liquidation in sub-court, Tirupati for recovery of Rs.6,20,20,546.20 ps. After the enactment of Recovery of Debts due to Banks and Financial Institutions Act, 1993, O.S.No.139 of 1990 was transferred to the Debts Recovery Tribunal, Bangalore and it was numbered as O.A.No.814 of 1997. The matter was thereafter transferred to the Debts Recovery Tribunal, Hyderabad and was renumbered as O.A.No.972 of 1999 and it was decreed on 11.06.2001. Pursuant to the same, the recovery certificate dated 11.04.2002 was issued for Rs.19,97,18,404.82 ps. The said certificate was forwarded to the Recovery Officer, DRT, Coimbatore for execution. Accordingly, recovery proceedings were initiated vide R.P.No.40 of 2006 and by order dated 03.09.2009 the property in question was attached by the Recovery Officer. It is also explained that the respondent-Bank filed C.A.No.229 of 1990 in C.P.No.48 of 1989 seeking leave of this Court to proceed with O.S.No.139 of 1990 and the same was allowed by this Court by order dated 07.12.1990 observing that the Official Liquidator shall be put on notice of the result of the suit and the execution proceedings that may be taken up by the Bank and that the decree if any passed by the Civil Court shall be subject to the orders that may be passed by this Court under the provisions of the Companies Act. In view of the said order passed by this Court in C.A.No.221 of 1990, the present application is unwarranted. I have heard the learned counsel for the Official Liquidator as well as the learned counsel appearing for the respondent-Bank. A perusal of the plaint in O.S.No.139 of 1990 on the file of the Court of the sub-ordinate Judge, Tirupati shows that Ac. 0.29 cents 389 sq.ft of land situated at Krishnarayanapuram village, Coimbatore Taluk forms part of Schedule C and the suit was filed for recovery of money due from the company in liquidation. It is also clear from the material placed before this Court that the said suit was renumbered as O.A.No.972 of 1999 on being transferred to the Debts Recovery Tribunal, Hyderabad. In the meanwhile, one of the creditors field C.P.No.48 of 1989 for winding up of the company and the same was ordered by this Court on 17.10.1990. In the circumstances, the respondent-Bank moved C.A.No.221 of 1990 seeking leave of this Court to proceed with O.S.No.139 of 1990 and the same was allowed on 07.12.1990 thereby permitting the respondent Bank to remain outside the winding up proceedings. However the respondent Bank was directed that the Official Liquidator should be put on notice of the result of the suit and the execution proceedings, if any. It is also evident from the material placed before this Court that the suit was decreed by the Debts Recovery Tribunal, Hyderabad on 11.06.2001 and the recovery certificate was issued on 11.04.2002. The said fact was informed to the Official Liquidator by letter dated 06.08.2009 and thereafter the Recovery Officer, DRT, Coimbatore attached the property in question on 30.09.2009 in R.P.No.40 of 2006. In identical circumstances, in RAJASTHAN STATE FINANCIAL CORPN. v. OFFICIAL LIQUIDATOR[1] it was held by the Supreme Court that a Debts Recovery Tribunal acting under the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 would be entitled to order the sale and to sell the properties of the debtor, even if a company-in-liquidation, through its Recovery Officer but only after notice to the Official Liquidator or the Liquidator appointed by the Company Court and after hearing him. It is also relevant to notice the following observations made in the above decision: “The right to sell under the SFC Act or under the Recovery of debts Act by a creditor coming within those acts and standing outside the winding up, is different from the distribution of the proceeds of the sale of the security and the distribution in a case where the debtor is a company in the process of being wound up, can only be in terms of Section 529-A read with Section 529 of the Companies Act. After all, the Liquidator represents the entire body of creditors and also holds a right on behalf of the workers to have a distribution pari passu with the secured creditors and the duty for further distribution of the proceeds on the basis of the preferences contained in Section 530 of the Companies Act under the directions of the company court. In other words, the distribution of the sale proceeds under the direction of the company court is his responsibility. To ensure the proper working out of the scheme of distribution, it is necessary to associate the official liquidator with the process of sale so that he can ensure, in the light of the directions of the company court, that a proper price is fetched for the assets of the company –in-liquidation.” In the light of the settled legal position noticed above and having regard to the fact that by order of this Court dated 7.12.1990 in C.A.No.221 of 1990 the respondent Bank – a secured creditor was granted leave to remain outside the winding up proceedings in respect of the property in question, I do not find substance in the contention that the respondent Bank, shall hand over the possession of the property in question to the Official Liquidator. There is also no need to seek any further direction from this Court in view of the order already passed in C.A.No.221 of 1990, dated 7.12.1990. In the facts and circumstances of the case, the reliefs as prayed for cannot be granted. The property in question which is already attached by the Recovery Officer of DRT, Hyderabad can be sold after hearing the Official Liquidator, who is also a party to the recovery proceedings pending before the DRT. However the sale proceeds shall be deposited with the Official Liquidator for distribution as per the orders of the Company Court in accordance with law. Accordingly, the Application is disposed of. ____________ G. ROHINI, J. Dt. 29.12.2010 klp [1] (2005) 8 SCC 190