Transparent sale under financial corporation powers upheld where default existed and no bona fide higher offer was shown.

Judicial interference with a State Financial Corporation's sale under section 29 of the State Financial Corporations Act, 1951 was not warranted where the borrower had defaulted, the sale was widely advertised, the notice was corrected to cover the relevant assets, and no purchaser responded to the public notice. The petitioner did not make any offer at the negotiation stage, and the record did not show any higher bona fide offer or non-transparent conduct by the Corporation. Mere allegations that the industrial unit could have fetched a better price were insufficient. The sale in favour of the purchaser was upheld, with consequential directions on refund and adjustment of any surplus in accordance with law.

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Issues: (i) Whether the sale of the petitioner's industrial unit by the State Financial Corporation under section 29 of the State Financial Corporations Act, 1951 was liable to be interfered with on the ground of alleged inadequacy of price and want of a transparent sale process.

Issue (i): Whether the sale of the petitioner's industrial unit by the State Financial Corporation under section 29 of the State Financial Corporations Act, 1951 was liable to be interfered with on the ground of alleged inadequacy of price and want of a transparent sale process.

Analysis: The petitioner had admittedly defaulted in repayment of the loan and interest, justifying action by the Corporation under section 29. The unit was advertised for sale with due publicity, the sale notice was subsequently corrected to include land, building, plant and machinery, and no purchaser responded to the public notice. The petitioner also did not offer any amount for release of the unit at the negotiation stage. The Corporation thereafter negotiated with the purchaser who offered Rs. 1,05,000, and the material on record did not show that a higher bona fide offer was available or that the Corporation acted in a non-transparent manner. Mere assertions that the unit could have fetched more were insufficient to warrant judicial interference in the facts of the case.

Conclusion: The sale could not be interfered with, as the Corporation had acted within its powers and had adopted a procedure sufficient to realize the best possible price on the facts.

Final Conclusion: The writ petition was not maintainable for interference with the completed sale, and the Corporation's sale in favour of the purchaser was upheld with consequential directions regarding refund and adjustment of surplus in accordance with law.

Ratio Decidendi: Judicial interference with a sale by a State Financial Corporation under section 29 is not warranted where the sale is preceded by due publicity, the process is transparent, and no bona fide higher offer is shown to exist.

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