Single property sale is not an undertaking under company law; distress-sale challenge fails absent perversity or undervaluation.

A single non-operational, non-revenue-generating property was held not to be an "undertaking" under Section 180(1)(a) of the Companies Act, 2013, because the statutory distinction between assets and undertakings means the 20% threshold applies only after the subject matter first qualifies as an undertaking. No special resolution was therefore required for the sale. The challenge to cancellation also failed: the sale was treated as a SARFAESI distress sale, conducted after valuation on an "as is where is" basis, with no proved mala fides, related-party abuse, undervaluation, perversity, or legal error warranting interference.

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Issues: (i) Whether the sale of the Saakar Bungalow Property was disposal of an "undertaking" within Section 180(1)(a) of the Companies Act, 2013 so as to require a special resolution of the company; (ii) Whether the sale deed was liable to be cancelled on the grounds of mala fides, lack of good faith, undervaluation, or other irregularity warranting appellate interference.

Issue (i): Whether the sale of the Saakar Bungalow Property was disposal of an "undertaking" within Section 180(1)(a) of the Companies Act, 2013 so as to require a special resolution of the company.

Analysis: The expression "undertaking" was treated as distinct from a mere asset or property of the company. On the facts, the property was found to be an individual, non-operational, non-revenue-generating asset and not a business unit or going concern. The 20% threshold in the Explanation to Section 180 operates only after the subject matter first qualifies as an undertaking. The comparative scheme of the 1956 and 2013 Acts and the statutory distinction between "assets" and "undertakings" supported the view that a sale of a single mortgaged property does not amount to sale of substantially the whole of an undertaking.

Conclusion: The property was not an undertaking, and no special resolution under Section 180(1)(a) was required.

Issue (ii): Whether the sale deed was liable to be cancelled on the grounds of mala fides, lack of good faith, undervaluation, or other irregularity warranting appellate interference.

Analysis: The sale was treated as a distress sale in the course of SARFAESI enforcement for recovery of bank dues. The purchaser was not shown to be a related party or to have been proceeded against by any direct allegation in the pleadings. The transaction was conducted after valuation, with the property sold at a price found to be near fair market value, on an "as is where is" basis, and no perversity or arbitrariness in the tribunal's evaluation was demonstrated. Interference in such discretionary matters was held to be limited and unavailable absent perversity or disregard of settled legal principles.

Conclusion: The sale was not shown to be mala fide or unfairly undervalued, and no ground was made out for cancellation or interference.

Final Conclusion: The challenge to the sale failed in entirety, and the impugned orders upholding the transaction were sustained.

Ratio Decidendi: A sale of a single non-operational asset is not a sale of an "undertaking" under Section 180(1)(a), and appellate interference with a discretionary order confirming such sale is unwarranted absent perversity, arbitrariness, or legal error.

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