Case: A.P.I.I.C.Ltd Vs. M/S Team-Asia Lakhi Semiconductors L.&amp;An

3. The circumstances in which the aforestated appeal has been filed are as under:The appellant is a Government Corporation which allots plots of landfor the purpose of setting up industries to different persons. The plotsare allotted on certain conditions and if the conditions are not fulfilledor if the entire payment is not made within the time stipulated, the allotment is cancelled and possession of the plot is taken back by the appellant.In pursuance of the aforestated activity of theunder a letter dated 31st August, 1988, thehad allotted a plot to M/s.Lakhi Semiconductors Ltd. on conditions incorporated in the said letter. The allotment was made in pursuance of an application dated 20th August, 1988 submitted by the M/s.Lakhi Semiconductors Ltd. and the plot was valued at Rs.1,22,67,500/and the said amount had been calculated at the rate of Rs.250/per sq. meter. The said amount had to be paid to thewithin sixty days from the date of the receipt of the allotment order. It is an admitted fact that within the period prescribed, the entire price of the plot had not been paid by the said allottee to theand in the circumstances, as per clause 8 incorporated in the said letter, which reads as under, the amount paid by thecompany had been forfeited.?8. If payment as stipulated in condition (3) above is not made within 60 days of receipt of this allotment letter, this allotment letter shall stand cancelled and the EMD paid shall remain forfeited.?4. After the Company had failed to make payment and the allotment was cancelled, a request was made by the Company to grant another plot at some reduced price and in pursuance of the said request, the appellant had addressed another letter dated 13th March, 2000 to the Company offering another plot. The Company again failed to comply with the conditions and therefore, the proposal with regard to allotment under the letter dated 13th March, 2000 also failed. Once again another plot was offered to the Company by the appellant under letter dated 3rd April, 2001 for Rs.80,00,000/but the said transaction also did not materialize. The aforesaid facts demonstrate the chequered history and the circumstances in which the Company could not make entire payment of the plot in question, which ultimately resulted into forfeiture of the amount paid and even possession of the plot in question was with the appellant though for a limited purpose, the Company was permitted to occupy the plot.5. It is pertinent to note that the Company, because of its very poor financial conditions, was ordered to be wound up and the official liquidator, appointed by the Company Court wanted to take possession of the plot in question so that the said plot may be sold and out of the sale price, dues of the Company may be paid. When thecame to know that the official liquidator was making an effort to dispose of the plot in question, believing the plot to be one of the assets of the Company in Liquidation, a Company Application No.474/2006 in the Company Petition No.178/2003 was filed by the appellant praying for taking possession of the plot in question as the plot was in unauthorized possession of the Company. In the said proceedings, the official liquidator admitted the fact that the plot in question had not been transferred in the name of the Company. Ultimately, by an order dated 28th June, 2007 the Company application filed by the appellant had been dismissed by the High Court with a direction to the official liquidator to take appropriate steps to dispose of the plot in question.6. Being aggrieved by the aforestated order passed in the Company application, the appellant had filed an appeal being O.S.A.No.20/2008 before the High Court contending that the plot in question had not been transferred to the Company and therefore, the official liquidator had no right or title in respect of the plot in question and therefore, he could not have taken any action for selling the same.7. The said appeal filed by the appellant has also been dismissed by the High Court of A.P. and therefore, the present appeal has been filed by the

Reasoning:
13. In the aforestated circumstances, in our opinion, the High Court was not justified in giving any right in respect of the plot in question to the official liquidator or the Company. It is pertinent to note that the ownership of the plot in question had not been transferred to the Company and a permissive possession given by the appellant to the Company for some limited purpose would not create any interest or right in favour of the Company. The plot would remain the property of theas the conditions on which the transfer was to take place had not been fulfilled.14. In the aforestated circumstances, we are of the view that the High Court was in error while coming to the conclusion that the appellant had no right in the plot in question and therefore, the impugned judgment as well as the order passed in Company Application are quashed and set aside and it is held that the plot in question does not belong to the Company in liquidation and the official liquidator has no right to deal with the said plot or dispose of the said plot and it would be open to theto deal with or allot the said plot as per its own policy.