TaxTMI 
TaxTMI 
TaxTMI 
2004 (3) TMI 752
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.... the loan. The hotel was valued on 3rd July 2001 by BICICO through its valuer. According to this valuation, the property was worth Rs. 2.16 crore After this, a publication was made on 31st January 2002 offering the hotel for sale on an "As is where is basis". Offers were required to be made by 28th February 2002. The respondent No. 6 offered to purchase the hotel for Rs. 41 lakhs. The offer was rejected by BICICO because the bid was too low. The property was again re-valued on 24th January 2002 by BICICO. By what, according to BICICO, was only an "in- house assessment", the value of the hotel was estimated at Rs. 1.58 crores. But when a third valuation was again made at the instance of BICICO in February 2002, the total value of the property including of the building and land was only Rs. 94.81 lakhs. On 26th March 2002, a second sale notice was published by BICICO in respect of the hotel on "As is where is basis". This notice has been impugned before us. Under this notice offers were to be given by way of a sealed cover by 29th March 2002 i.e. within three days. Of these three days 28th March 2002 was 'Holi' and 29th March 2002 was 'Good Friday'. It appears from ....
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....e hotel was not handed back to the appellant. It may be mentioned that during this period, BICICO announced a settlement policy under which concerns which had taken a loan less than 10 years earlier could settle their dues by paying double the original principal amount lent by the BICICO to such defaulters. The appellant applied for settlement of its outstanding dues. However, the prayer of the appellant for a one time settlement was rejected by BICICO under the settlement policy. When the writ petition came up for disposal, the learned Single Judge dismissed it holding that as the appellant had suppressed the fact that it had filed a suit prior to the initiation of writ proceedings its conduct verged on fraud and that the appellant had, disentitled itself from any relief in the extraordinary prerogative writ jurisdiction. It was also held that the BICICO had acted bonafide in taking action under Section 29 and selling the hotel. While dismissing the writ petition, the learned Single Judge directed BICICO to consider the appellant's application for one time settlement in accordance with law. BICICO was directed to hand over the possession of the hotel to respondent No. 6 and ....
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....dence, the fact that she had purchased and was maintaining a house in the country was held to be a material fact the suppression of which disentitled her from the relief claimed. Again when in earlier proceedings before this Court, the appellant had undertaken that it would not carry on the manufacture of liquor at its distillery and the proceedings before this Court were concluded on that basis, a subsequent writ petition for renewal of the licence to manufacture liquor at the same distillery before the High Court was held to have been initiated for oblique and ulterior purposes and the interim order passed by the High Court in such subsequent application was set aside by this Court. Similarly, a challenge to an order fixing the price was rejected because the petitioners had suppressed the fact that an agreement had been entered into between the petitioners and the Government relating to the fixation of price and that the impugned order had been replaced by another order . Assuming that the explanation given by the appellant that the suit had been filed by one of the Directors of the Company without the knowledge of the Director who almost simultaneously approached the High Court ....
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....h was passed by the High Court was obtained when the suit was pending. But by the time the writ petition was heard the suit had already been withdrawn a year earlier. Although the appellant could not, on the High Court's reasoning, take advantage of the interim order, it was not correct in rejecting the writ petition itself when the suit had admittedly been withdrawn, especially when the matter was ripe for hearing and all the facts necessary for determining the writ petition on merits were before the Court, and when the Court was not of the view that the writ petition was otherwise not maintainable. As the issue of suppression was the only ground on which the High Court has rejected the appellant's plea for relief, we would ordinarily have set aside the order of the High Court in view of our finding and remanded back to the High Court for decision of the matter on merits. But the matter has been argued on merits before us and we are in a position to dispose of the matter which we accordingly proceed to do. We are of the view that the sale effected in favour of respondent No. 6 cannot be sustained. It is axiomatic that the statutory powers vested in the State Financial Cor....
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....le was given on 31st January 2002. A period of about four weeks was given to the purchasers to submit their offers by 28th February 2002. The period of four weeks can therefore be taken to be the ordinary norm. But when the second impugned notice of sale was given on 26th March 2002, less than three days were given for the purchasers to inspect the premises, make necessary arrangements and submit their offers to BICICO. Of these three days, two were public holidays when banks would have also been shut. The period of notice was, in the circumstances, entirely inadequate. Besides, we have not been told the reason for this unusual haste. Such precipitate action was not called for unless there were some other considerations weighing with the authorities, considerations which have not been disclosed to the Court. The method in which the sale was conducted is also questionable. Three valuations were obtained between 3rd July 2001 to February 2002 before the property was sold to the respondent No. 6. What was valued in July 2001 as worth Rs. 2.16 crores is valued at Rs. 94.81 about 10 months later, a fall of over Rs. 1.50 crores. The third extra ordinary circumstance is that the respond....
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....vestments in the property. As far as the first factor is concerned, the appellant has offered to pay interest on the amount of Rs. 1 crore to the respondent No. 6. On the second, we have not been told whether any formal agreement has been concluded between BICICO and the respondent No. 6 or whether any conveyance has been executed or any other formality completed by BICICO to transfer the title in the hotel in favour of the respondent no. 6. It appears to have handed over possession to the Respondent No. 6 only upon the direction of the High Court. As far as the third ground is concerned, the appellant was fully aware that the appellant was fighting tooth and nail to redeem its property and that the sale was the subject matter of scrutiny by Court. If it has chosen to make renovation or investments in the hotel, it has done so despite the knowledge of the precarious nature of its possession. The investments, if any, were a calculated risk taken by the respondent No.6 itself the consequence of which cannot be foisted on the appellant. In the circumstances, we set aside the decision of the High Court and grant the appellant the reliefs claimed in the writ petition. The sale of the a....