THE HON’BLE SRI JUSTICE GODA RAGHURAM AND THE HON’BLE SRI JUSTICE P.DURGA PRASAD WRIT APPEAL NOs.784 and 1142 OF 2004 COMMON JUDGMETN DATED: 30-06-2011. W.A.NO.784 OF 2004 BETWEEN: A.P.STATE FINANCIAL CORPORATION REP. BY ITS MANAGING DIRECTOR CHIRAG ALI LANE, HYDERABAD .. APPELLANT AND M/S UREKA HEAT AND EXCHANGERS LTD., REP. BY ITS MANAGING DIRECTOR, C.S.REDDY, S/O.SEETHA RAMI REDDY OFFICE: 26, IDA, BALANAGAR, HYDERABAD AND ANOTHER .. RESPONDENTS W.A.NO.1142 OF 2004 BETWEEN: E.VITTAL .. APPELLANT AND M/S UREKA HEAT AND EXCHANGERS LTD., REP. BY ITS MANAGING DIRECTOR, C.S.REDDY, S/O.SEETHA RAMI REDDY OFFICE: 26, IDA, BALANAGAR, HYDERABAD AND ANOTHER .. RESPONDENTS THE HON’BLE SRI JUSTICE GODA RAGHURAM AND THE HON’BLE SRI JUSTICE P.DURGA PRASAD WRIT APPEAL NOs.784 and 1142 OF 2004 COMMON JUDGMENT: ( Per THE HON’BLE SRI JUSTICE G.RAGHURAM ) Heard learned counsel for the appellant in W.A.No.784 of 2004. There is no representation on behalf of the appellant in W.A.No.1142 of 2004, nor is there any representation on behalf of 1st respondent (the writ petitioner), in these appeals. The 1st respondent herein had filed the writ petition for a declaration that the auction proceedings initiated by the Andhra Pradesh State Financial Corporation (for short APSFC) vide its advertisement dated 24-7-2002 and subsequent acceptance of the bid of the 2nd respondent for Rs.1.20 crores is illegal and unenforceable. The writ petition was allowed by the judgment under appeal. Relevant facts are that the writ petitioner is a company incorporated under the Indian Companies Act and had borrowed an amount of Rs.8.42 crores from APSFC for purchase of plant and machinery some time earlier to 1980 and another Rs.11.00 lakhs for expansion of its business in September, 1980. Demonstrably the writ petitioner defaulted in payment of instalments and thereupon APSFC issued a notification dated 24.7.2002 proposing to auction the unit of the petitioner under section 29 of the State Financial Corporations Act, 1951. The APSFC formulated general terms and conditions for sale of assets and enumerated therein the conditions to be followed and notified for the sale of writ petitioner’s unit and got a notification published in the press on 24.7.2002. Condition No.25 of the general terms and conditions incorporated in the sale notification of the writ petitioner’s unit is to the effect that once the offer for sale of the unit is accepted by the Corporation, 15 days notice would be issued as a final opportunity to all the promoters of the unit and a sale letter to the successful bidder/ tenderer will be issued only if there is no response from the promoters. While the writ petitioner denies having received any notice from the APSFC in terms of condition No.29 mentioned above, the APSFC had contended that it did issue notices. The learned single Judge considered the claims of APSFC to have sent several notices to the promoters including the writ petitioner both before and after the auction notification, but found that only a copy of the letter dated 31.12.2001 (prior to the auction notification and sale of the unit) was placed before the court which was claimed to have been sent, not by registered post but by certificate of posting. The writ petitioner denied receipt of any notice from APSFC and therefore the court considered the rival contentions and deprecated the conduct of the APSFC by sending the notice not by registered post but by certificate of posting, a fact which cannot be verified. The learned single Judge adversely commented on the practice followed by the APSFC in sending communications by certificate of posting and concluded that there was no material to show that the notice as stipulated in condition No.29 of the general terms and conditions for auction was served on the Managing Director, let alone any of the promoters of the writ petitioner unit. It was urged on behalf of the APSFC and the 2nd respondent in the writ petition (the successful auction purchaser in the writ petition, who are appellants herein), that condition No.29 was incorporated in the general terms and conditions for conduct of auction and in the auction notification pursuant to observations of the Supreme Court in MAHESH CHANDRA v. REGIONAL MANAGER[1] and that since the judgment in MAHESH CHANDRA was over-ruled by the Supreme Court in STATE FINANCIAL CORPORATION v. M/S.JAGADAMBA OIL MILLS[2], even though condition No.29 was not complied with, the auction would not become invalid. The learned single Judge declined to countenance such contention for the reason recorded that the APSFC having formulated for itself a fair procedure even if more generous than is warranted by the law declared (in M/s JAGADAMBA OIL MILLS), on the aspect of conduct of auction, such rigorous norms are bound to be complied with. Having regard to the facts and circumstances of the case and the cogent reasons recorded in the judgment under appeal, we discern no error in the application of law or exercise of discretion by the learned single Judge, warranting interference in these appeals. The Writ Appeals are accordingly dismissed. In the circumstances, no costs. Dt: 30-06-2011. ( G.RAGHURAM, J ) ( P.DURGA PRASAD, J ) TNB THE HON’BLE SRI JUSTICE GODA RAGHURAM AND THE HON’BLE SRI JUSTICE P.DURGA PRASAD WRIT APPEAL NOs.784 and 1142 OF 2004 (COMMON JUDGMENT OF THE DIVISION BENCH DELIVERED BY G.RAGHURAM,J) DATED: 30-06-2011. [1] AIR 1993 SC 935 [2] AIR 2002 SC 834