Liquidation private sale must follow statutory procedure, with the liquidator ensuring wider competitive bidding to maximise value.

In liquidation, the liquidator must conduct any private sale in the manner prescribed by the regulations, with value maximisation as the governing objective. A private sale is not confined to the offers already placed before the Adjudicating Authority; wider participation must be explored through the statutory process, including a Swiss Challenge where appropriate. The Adjudicating Authority cannot substitute its own sale mechanism for the procedure entrusted to the liquidator or confirm a sale on the basis of limited competing bids alone. The stated consequence is that the impugned sale confirmation was set aside and the matter remitted for a fresh private-sale process.

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Issues: Whether the Adjudicating Authority could itself confirm a private sale of the corporate debtor on the basis of competing sealed bids, or whether the liquidator was required to conduct the private sale in accordance with the liquidation regulations and explore wider participation to maximise realisation.

Analysis: The liquidation framework places the conduct of sale primarily within the liquidator's statutory domain. Ordinarily, sale is to be by auction, while private sale may be undertaken only in the manner prescribed in Schedule I, with the object of maximising realisation. A private sale is not meant to be restricted to a single offeree merely because competing offers have emerged before the Adjudicating Authority. The proper course, where the liquidator has not yet undertaken a private sale process, is to permit the liquidator to initiate that process so that other interested bidders may also participate. The authority of the Adjudicating Authority is not to substitute its own sale process for the statutory procedure entrusted to the liquidator.

Conclusion: The confirmation of sale by the Adjudicating Authority on the basis of the two bids received before it was not sustainable. The matter was required to be remitted to the liquidator to conduct a private sale through a Swiss Challenge process, treating the existing offer as the anchor bid, so that higher bids, if any, could be elicited.

Final Conclusion: The appeal succeeded to the extent that the impugned sale confirmation was set aside and the liquidation process was directed to be carried forward through a fresh statutory private-sale mechanism aimed at value maximisation.

Ratio Decidendi: In liquidation, the liquidator must conduct private sale in the manner prescribed by the regulations, and the Adjudicating Authority cannot itself short-circuit that process by confirming a sale on limited bids before wider competitive participation is explored.

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