Winding-up asset sale permitted where no interim restraint exists and common-facility assets can be sold as a separate lot.

In winding-up proceedings, the court may authorise sale of a company's movable and immovable assets where the sale is needed to curb mounting liabilities, preserve depreciating assets, and protect the interests of secured creditors and workmen. Common-facility assets shared with another company may be segregated into a distinct lot so that their value and sale proceeds remain identifiable. Pendency of a challenge to an AAIFR order, and a SICA-based objection, do not by themselves bar the sale where no interim restraint exists. The sale process may proceed by public advertisement, with secured creditors participating and sale expenses apportioned among them.

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Issues: (i) Whether the official liquidator should be permitted to sell the movable and immovable assets of the company in liquidation, including the assets used as common facilities; (ii) whether the pendency of challenge to the AAIFR order and the objection based on the Sick Industrial Companies (Special Provisions) Act, 1985 barred such sale.

Issue (i): Whether the official liquidator should be permitted to sell the movable and immovable assets of the company in liquidation, including the assets used as common facilities.

Analysis: The sale was supported by the secured creditors in principle and was found necessary to arrest mounting liabilities, protect depreciating assets, and secure the interests of both secured creditors and workmen. The Court also accepted the practical difficulty arising from assets shared with another company and held that those common-facility assets could be segregated into a distinct lot so that their value and sale proceeds remained identifiable.

Conclusion: The official liquidator was permitted to proceed with the sale of the movable and immovable assets, with the common-facility assets to be sold separately in a distinct lot.

Issue (ii): Whether the pendency of challenge to the AAIFR order and the objection based on the Sick Industrial Companies (Special Provisions) Act, 1985 barred such sale.

Analysis: The Court held that the pendency of the writ petition did not justify withholding the sale because no interim restraint had been granted. It further declined to rule on the broader conflict between the Companies Act and the Sick Industrial Companies (Special Provisions) Act, 1985, since that question was already pending before the Division Bench. On the facts, the objection was found insufficient to prevent the sale process from going forward.

Conclusion: The pendency of the challenge and the SICA-based objection did not bar the sale.

Final Conclusion: The applications were allowed and the official liquidator was directed to commence the sale process with public advertisement, separate treatment of the common-facility assets, participation of secured creditors in the process, and apportionment of sale expenses among the secured creditors.

Ratio Decidendi: In winding-up proceedings, the Court may authorise sale of the company's assets, including segregated common-facility assets, where such sale protects the interests of secured creditors and workmen and no operative restraint exists from pending parallel proceedings.

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