PNP 1 WP8779-20.12.sxw IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.8779 OF 2010 Jay Electric Wire Corporation Employees Union ..Petitioner. versus Pravin Gada and others ..Respondents. ..... Ms. Jane Cox for the Petitioner. Mr. Ashutosh Kumbhakoni i/b Global Law Offices for Respondent No. 1. Mr. D.U. Chaurasia with Ms. Krupa Mehta i/b Manilal Kher Ambalal & Co. for Respondent No.3. Mr. V.K. Nair for Respondent No.4. Mr. L.T. Satelkar for the Official Liquidator. ...... CORAM : DR.D.Y.CHANDRACHUD & ANOOP V. MOHTA , JJ. 20 December 2010. P.C. : 1. These proceedings have been instituted on behalf of the workmen of Jay Electric Wire Corporation Limited. The company has been ordered to be wound up by an order dated 15 October 2008 of the Company Court. An award has been passed by the Industrial Tribunal at Mysore on 5 January 2001. The workmen had raised a demand following a termination of their services by the employer. The Industrial Court directed the employer to pay back wages to the workmen commencing from 6 February 1995 and to continue to pay wages during the subsistence of the relationship of employer and employee. O.A 582 of 2001 was filed before the Debts Recovery Tribunal at Mumbai in respect of the debts owed to ICICI Limited PNP 2 WP8779-20.12.sxw and the Central Bank of India. Upon the adjudication of the claims, recovery proceedings were initiated. In 2004 a public notice was issued for the sale of the movable and immovable properties of the company. Initially, only the movable properties were sold on 4 July 2004. The Applicant union moved an application on 23 July 2004 for impleadment in the recovery proceedings upon which, till date it appears that no order has been passed. In 2005 a valuer was appointed for valuing the immovable property of the company. A valuation report of 28 February 2005 was submitted and on the basis thereof the reserved price of the immovable property of the company at Mysore was fixed at Rs.80 lacs. No fresh public notice was issued for the sale of the immovable property. Two bidders, MGM Forging and the First Respondent submitted bids. The bids were in the amounts of Rs.1.10 Crores and Rs.80 lacs respectively. The First Respondent enhanced his bid to Rs.1.5 Crores and subsequently on 21 August 2006 both the First and the Second Respondent made a joint bid of Rs.2.5 Crores. The sale in favour of the First and Second Respondents was confirmed by the Recovery Officer on 27 October 2006. 2. The Central Bank of India, the Fourth Respondent moved an application on 30 October 2006 for setting aside the confirmation. In the meantime, on 10 November 2006 a third party by the name of Umrah Developers furnished an offer of Rs.3.15 Crores which was subsequently enhanced to Rs.6.45 Crores. The Recovery Officer by his order dated 5 December 2006 set aside the confirmation of the sale and directed that a fresh auction be conducted. Umrah Developers deposited an amount of Rs.3.15 Crores initially on 10 November 2006 PNP 3 WP8779-20.12.sxw and the balance on 11 December 2006 and the sale was confirmed in its favour. The First Respondent filed an appeal before the Debts Recovery Tribunal. The appeal was dismissed on 6 February 2007. The Debts Recovery Appellate Tribunal dismissed the further appeal on 2 July 2008. 3. The First Respondent thereupon filed a writ petition under Article 226 of the Constitution before this Court. On 11 August 2010 a Division Bench of this Court noted that one of the main factors that weighed with the Tribunal and the Appellate Tribunal was that a third party had made an offer at a much higher price than was offered by the First Respondent. However, subsequently the third party had not only withdrawn its offer but had also withdrawn the entire amount that was deposited by it with the Tribunal with the permission of this Court. Accordingly, the petition was allowed by setting aside the order of the Appellate Tribunal and by remanding the proceedings before the Appellate Tribunal for a fresh decision of the appeal. In pursuance of the order of remand, the Appellate Tribunal has dismissed the appeal by its impugned order dated 15 October 2010. 4. The Appellate Tribunal has noted that Umrah Developers, the third party which had initially offered a bid of Rs.6.45 Crores withdrew from the fray and was permitted to take back the entire amount of consideration which was deposited. The First Respondent had submitted a bid in the amount of Rs.2.50 Crores in 2006 and the amount which had been invested in the meantime had accumulated together with accrued interest to Rs.2.88 Crores in May 2010. In the PNP 4 WP8779-20.12.sxw meantime, another offer of Rs.4 Crores had been obtained by the Standard Chartered Bank (the Third Respondent.) The Debts Recovery Appellate Tribunal was of the view that considering the fact that the amount deposited by the First Respondent together with accrued interest increased to Rs.3 Crores, the enhanced offer of Rs.4 Crores was not so significant as to vitiate the sale. Besides, the Tribunal was of the view that there was no material to suggest fraud or any material irregularity in the conduct of the sale. 5. Counsel appearing on behalf of the Petitioner submitted that (i) There was no public notice for conducting the sale of the immovable property in 2006. There was a public notice only in 2004. Even in 2006 there was no effort made to publicize the sale widely; when the sale took place in favour of the First Respondent initially two bidders had come forth and as the record would show, there was no bidding inter se between the parties. This was noted in the order of the Presiding Officer of 6 February 2007; (ii) The Official Liquidator was not associated with the sale and no notice was issued to the Liquidator before the sale was confirmed. On the other hand, it has been submitted on behalf of the Respondent that (i) Since 2004 efforts were made for the sale of the property by a public notice, but no offers have been received; (ii) There was a valuation in 2005 according to which the property was valued at Rs.80 lacs and even in 2009 the fair market value was estimated at Rs.2.48 Crores. 6. Counsel appearing on behalf of the Central Bank of India, which is the Fourth Respondent to these proceedings has drawn the attention of the Court to the application that was filed by the Bank PNP 5 WP8779-20.12.sxw before the Tribunal in October 2006 setting out circumstances which according to counsel demonstrated that there was material irregularity in the conduct of the sale. 6A. During the course of the hearing, it has emerged before the Court that the Standard Chartered Bank had as a matter of fact indicated its consent to the sale of the property to the First Respondent. However, there is no dispute about the fact that the Central Bank of India had at no stage consented and had in fact objected to the confirmation of the sale. In our view a reading of the order of the Debts Recovery Appellate Tribunal, ex facie, shows that the submissions which had been made on behalf of the Petitioner as well as by the Central Bank, the Fourth Respondent have not been considered. The advocate for the Official Liquidator was also present before the Appellate Tribunal. We had indicated to the learned counsel that having regard to the fact that there has already been an order of remand by the Division Bench on an earlier occasion, this Court, with the consent of all the learned counsel could, if parties so desire, peruse the entire record and arrive at a final determination of the case so as to obviate a further remand. However, counsel appearing on behalf of the First Respondent has stated that since all the factual issues have not been dealt with by the Debts Recovery Appellate Tribunal, the First Respondent consents to an order by this Court setting aside the impugned order of the Debts Recovery Appellate Tribunal and to a fresh remand. Counsel appearing on behalf of the Petitioner has no objection to this course of action being followed. In the circumstances, with the consent of counsel appearing on behalf of the Petitioner, the First Respondent and the Fourth Respondent, the PNP 6 WP8779-20.12.sxw impugned order of the Debts Recovery Appellate Tribunal is set aside. Even otherwise, for the reasons which we have indicated earlier, we are of the view that an order of remand is just and proper having regard to the fact that the submissions which have been urged before the Appellate Tribunal have not been dealt with in the impugned order. Accordingly, the impugned order dated 15 October 2010 is set aside and Appeal 60 of 2007 with M.A. 929 of 2010 is restored to the file of the Debts Recovery Appellate Tribunal for fresh disposal. 7. Parties shall appear before the Debts Recovery Appellate Tribunal for directions on 6 January 2011 in order to enable the Appellate Tribunal to set down a fresh time schedule for the disposal of the appeal. The Appellate Tribunal is requested to expedite the disposal of the appeal preferably within a period of eight weeks of the first date of hearing. 8. Since the sale certificate has not been issued thus far, pending the disposal of the proceedings before the Appellate Tribunal, the sale certificate shall not be issued to the First Respondent. The Petition is accordingly disposed of. There shall be no order as to costs. (Dr. D.Y. Chandrachud, J.) (Anoop V. Mohta, J.)