Case: Shankarlal Aggarwal And Ors Vs. Shankarlal Poddar And Ors

impression that he would bring the money and make the deposit and as a matter of fact the narration of facts by the liquidators in their Masters summons clearly shows that they themselves were under this impression. In the circumstances the continued presence of the bidders there manifestly served no purpose and several of them therefore left the place and went away. The bidding list which is Annexure A to the petition of the liquidators showed that New India Transport Co. which had bid up to Rs. 2,55,000 / -. Babulal Bhagwandas who bid up to Rs. 2,75,000/- and Chabildas Agarwal, who went up to Rs. 2,85,000/- were not there when the second auction was held. The result therefore was that when after waiting for about 20 minutes the liquidators continued the auction several had left and the appellant was able to become the highest bidder for the price of Rs. 2,25,000 /-. This feature of the case was missed by the learned Company Judge and forms the basis of the decision of the Division Bench. We would go further and add that on a proper construction of condition 5 the liquidators were not entitled to proceed with the sale in the circumstances that happened because of the interval of time they granted to Nandlal to make the deposit which gave the impression to those who gathered there that there would be no further auction on the same date at which they were entitled to bid. Learned Counsel for the appellant referred us to the fact that one S. K. Chakrabarti who in the first auction had bid up to Rs. 2,98,000 /- was present at the resumed auction and that he bid then only for Rs. 2,00,000/- and that this feature of the resumed auction was not noticed by the learned Judges in appeal. We consider that this is not a very relevant circumstances for a decision of the question either as regards the power of the liquidators to hold the fresh sale without advertisement or whether the sale at the resumed auction had been at an undervalue. It is possibly profitless to speculate how or why it happened that persons who half an hour earlier had been willing to bid for much larger figures suddenly permitted the appellant to become the purchaser for Rs. 2,25,000/-. It may be mentioned that at the resumed bidding them were only six bidders of whom three had not bid at the earlier auction at all, though apparently they were present - Shantilal Bansidhar, Power and Machinery Construction Co., and Relay Corporation. Besides these three there were only two others Mahabir Prasad who had earlier bid for Rs. 2,10,000/- and now contended himself with a bid for Rs. 1,90,000/- and S. K. Chakrabarti who though originally thought that the property was worth having for Rs. 2,98,000 / - now refused to go beyond Rs. 2,00,000/-. These facts show that if those others who had gathered them at the beginning of the auction but who left the place under the impression that Nandlal would make the required payment had continued them, the appellants bid for Rs. 2,25,000/- would not have been the highest bid. We consider therefore the learned Judges of the Division Bench were justified in considering that the sale to the appellant ought not to have been confirmed.22. There was one further point made by learned Counsel that when the learned Judges allowed the appeal of the respondent they should not have directed a resale of the property by a fresh auction but should have confirmed the sale to the appellants at the price of Rs. 3,35,000/ - which was the amount of their bid at the first auction. The basis of this argument was the undertaking which they gave at the time of the disposal of the application for interim stay pending the hearing of the appeal. We have already extracted the terms of that undertaking. It is not easy to find any legal basis for this argument. It is true that in the event of the appeal being allowed the Court might have possibly with the consent of the 1st respondent before us, insisted upon the appellant taking the property for Rs. 3,35,000 /- but that surely cannot give the appellants any legal right to insist that the property be sold to them. It was a condition for the grant of the indulgence of stay and by no strength of language could that be read as implying that the appellants had a right to purchase the property. It is true that the appellants have made a grievance about this matter in the application for leave to this Court as well as in the statement of the case but that hardly improves for position.23. This matter may also be looked at from a slightly different point of view. Immediately Nandlal failed to turn up on September 8, 1956 the liquidators enquired of the appellants whether they were willing that their penultimate bid be treated as the highest bid and they be declared purchasers. This offer was refused as apparently they were satisfied that they would be able to get the property for a much less sum. Thereafter the liquidators took out a Masters summons seeking sanction of the Court for the sale to them for Rs. 2,25,000/-. The appellants supported that application. In other words, they wanted that the Court should confirm the sale to them for Rs. 2,25,000/- and that was the order which they obtained from the learned Company Judge. It was only when the appeal was filed and an application for stay was moved before the Appellate Court by the 1st respondent here that the offer which is embodied in the undertaking was made. In the circumstances it is difficult to see what justification there is for the contention that the learned Judges should, when they allowed the appeal, have confirmed the sale to them for Rs. 3,35,000/ -. We consider there is no substance in this submission.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]In the view we are clearly of the opinion that the order of the Court was, in the circumstances, a judicial order and not an administrative one and was therefore not inherently incapable of being brought up infind ourselves in agreement with the view here expressed. Madan Gopal Daga, ILR 55 Cal 262   : (AIR 1928 Cal 295  ) proceeds wholly on the meaning which could be attributed to the word "conditions" in the expression "subject to the conditions" occurring in S. 202 and does not take into account the context in which S. 202 was designed to operate and particularly the fact that more than one grade of Court each governed by different rules as to the nature of the decision which would enable an appeal to be preferred could be vested with jurisdiction under the Act. When by the proviso to S. 3 of the Indian Companies Act, 1913 the Indian Legislature enabled jurisdiction to be vested in District Courts so as to be constituted the "Court having jurisdiction under the Act", knowledge must be imparted to it that the District Courts and the High Courts functioned under different statutory provisions as regards rights of appeal from their orders and decisions. Besides, it would also be fair to presume that they intended to prescribe a uniform law as regards the substantive right of appeal conferred by S. 202. It could not therefore be that an identical order if passed by one class of "Court having jurisdiction under the Act" would be final, but that if passed by another Court vested with identical powers and jurisdiction would be subject to anthus agree with Chagla, C.J. that the second part of the section which refers to "the manner" and "the conditions subject to which appeals may be had" merely regulates the procedure to be followed in the presentation of the appeal and of hearing them, the period of limitation within which the appeal is to be presented and the forum to which appeal would lie and does not restrict or impair the substantive right of appeal which has been conferred by the opening words of that section. We also agree with the learned Judges of the Bombay High Court that the words "order or decision" occurring in the 1st part of S. 202 though wide, would exclude merely procedural orders or those which do not affect the rights or liabilities of parties.There was one further point made by learned Counsel that when the learned Judges allowed the appeal of the respondent they should not have directed a resale of the property by a fresh auction but should have confirmed the sale to the appellants at the price of Rs. 3,35,000/ - which was the amount of their bid at the first auction. The basis of this argument was the undertaking which they gave at the time of the disposal of the application for interim stay pending the hearing of the appeal. We have already extracted the terms of that undertaking. It is not easy to find any legal basis for this argument. It is true that in the event of the appeal being allowed the Court might have possibly with the consent of the 1st respondent before us, insisted upon the appellant taking the property for Rs. 3,35,000 /- but that surely cannot give the appellants any legal right to insist that the property be sold to them. It was a condition for the grant of the indulgence of stay and by no strength of language could that be read as implying that the appellants had a right to purchase the property. It is true that the appellants have made a grievance about this matter in the application for leave to this Court as well as in the statement of the case but that hardly improves for position.23. This matter may also be looked at from a slightly different point of view. Immediately Nandlal failed to turn up on September 8, 1956 the liquidators enquired of the appellants whether they were willing that their penultimate bid be treated as the highest bid and they be declared purchasers. This offer was refused as apparently they were satisfied that they would be able to get the property for a much less sum. Thereafter the liquidators took out a Masters summons seeking sanction of the Court for the sale to them for Rs. 2,25,000/-. The appellants supported that application. In other words, they wanted that the Court should confirm the sale to them for Rs. 2,25,000/- and that was the order which they obtained from the learned Company Judge. It was only when the appeal was filed and an application for stay was moved before the Appellate Court by the 1st respondent here that the offer which is embodied in the undertaking was made. In the circumstances it is difficult to see what justification there is for the contention that the learned Judges should, when they allowed the appeal, have confirmed the sale to them for Rs. 3,35,000/ -. We consider there is no substance in this submission.