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Issues: (i) Whether the pendency of the BIFR reference barred execution of the consent order and further steps for conveyance of the mortgaged properties; (ii) Whether the respondents could be compelled to refrain from executing the conveyance or the sale could be obstructed on objections such as valuation and capital gains tax.
Issue (i): Whether the pendency of the BIFR reference barred execution of the consent order and further steps for conveyance of the mortgaged properties.
Analysis: The properties belonged to the guarantors, were covered by consent terms recorded in proceedings under Section 9 of the Arbitration and Conciliation Act, 1996, and had already been directed to be sold through a private receiver. The plea based on Section 22(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 had earlier been rejected by a reasoned order that had attained finality. The later attempt to reopen the same issue by relying on subsequent decisions was held to be unavailing because the dispute was not about fresh coercive proceedings against the company's assets, but about implementation of concluded consent terms and confirmation of sale.
Conclusion: The plea that the BIFR reference barred execution of the conveyance was rejected.
Issue (ii): Whether the respondents could be compelled to refrain from executing the conveyance or the sale could be obstructed on objections such as valuation and capital gains tax.
Analysis: The sale had already been confirmed up to the Supreme Court, and the only remaining step was execution of the conveyance, which was treated as a ministerial act. Objections regarding valuation had earlier been left open only for the stage of confirmation of sale, and objections concerning capital gains tax were held irrelevant to the basic terms on which the sale had been concluded. The Court also held that the parties could not, after consenting to the sale process and allowing it to attain finality, prevent completion of the transaction by raising collateral objections.
Conclusion: The request to obstruct execution of the conveyance and the connected objections were rejected.
Final Conclusion: The sale and its consequential completion were upheld, and no further restraint could be imposed on execution of the conveyance in favour of the respondent.
Ratio Decidendi: Where consent terms governing sale of mortgaged property have attained finality and the only remaining step is execution of the conveyance, Section 22(1) of SICA does not bar completion of that ministerial act on the basis of a later BIFR reference.
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