TaxTMI 
TaxTMI 
2023 (5) TMI 1165
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....iefs:- (a) To direct the Recovery Officer, DRT, Bangalore to comply with the directions of the Hon'ble Division Bench, High Court, Madras dated 17.09.2009 in O.S.A.Nos.59 to 63, 76, 77 and 82 of 2009 and M.P.Nos.1 and 2 of 2009 in O.S.A.No.59 of 2009 and M.P.No.2 of 2009 in O.S.A. No.60 of 2009; (b) To direct R-3 to associate with the Official Liquidator to bring the properties for sale and then to take his portion of outstanding dues on the sale proceeds as per law or otherwise; (c) To permit the Official Liquidator to engage the services of ITCOT for valuing the assets of the company in liquidation; (d) To permit the Official Liquidator to conduct the sale through public auction by giving vide publicity in the newspapers as directed by this Hon'ble Court; (e) To permit the Official Liquidator to meet out the expenses in connection with sale viz., valuation expenses and advertisement charges to cause publication of sale notice from the common pool fund and to recoup the amount incurred immediately from sale of assets on priority basis; (f) To direct the cost of the application do come out of the funds from the company i....
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....ourt of Madras to pursue the recovery proceedings before the Debts Recovery Tribunal, Bangalore. The Company Court also granted leave on 10.03.2000 subject to the condition that no coercive steps are taken against the assets of the company belonging to the applicant, as they were given as collateral security and the Official Liquidator was also impleaded as a party in the proceedings before the Debts Recovery Tribunal. Pursuant to the above development, the Debts Recovery Tribunal, Bangalore also issued the recovery certificate dated 15.05.2002 for recovery of the loan availed by Deve Sugars Limited from the State Bank of Mysore and the State Bank of Mysore also filed Company Application No.1300 of 2003 with a prayer that the Bank be permitted to execute the recovery certificate. But the Registry of the High Court returned the said company application by recording an endorsement that the leave of the Court was not necessary. 3. Pursuant thereto, the Recovery Officer proceeded with the sale of the properties belonging to the applicant, which were given as collateral security, on the premise that the sale proceedings were initiated for recovery of the loans borrowed by Deve Sugars....
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..... In the impleadment application, the applicant stated (i) that the applicant company was the owner of the properties and the properties belonged to them; (ii) that they were ready to settle the entire dues of the workers, creditors and other statutory dues; (iii) that they were taking necessary actions for revival of the company for the welfare of 947 workmen; (iv) that the applicant would be greatly affected if they were not heard, as the assets are owned by the applicant. 4. Continuing his arguments, Mr.G.Rajagopalan further stated that in the meanwhile, the debts of Tapti Machines Private Limited were later assigned to MTitanium Apartments Private Limited vide a deed of assignment dated 06.01.2012. The said party also filed I.A.Nos.44-50 of 2011 in S.L.P.(C)Nos.29559-29565 of 2009, which became Civil Appeal Nos.6042-6048 of 2011, for impleadment, instead of Tapti Machines Private Limited. The Apex Court also by a common order dated 04.07.2016 allowed the impleadment applications filed by MTitanium Apartments Private Limited. In the said application also, it was conceded that the properties in question proposed to be sold in the recovery proceedings pending before the Debts R....
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....stion to the applicant Tungbhadra Sugar Works Limited, as a result the charge against the properties is completely lifted and the possession of the land including the plant and machinery ought to be given back to the applicant. On this basis, the learned Senior Counsel sought for allowing the three applications as prayed for. 5. Mr.Omprakash, learned Senior Counsel appearing for the respondent Pegasus Assets Reconstruction Private Limited, agreeing with the submissions made by Mr.G.Rajagopalan, learned Senior Counsel appearing for the applicant, stated that the dues payable to the Pegasus Assets Reconstruction Private Limited had been settled and on receipt of the entire dues, the Pegasus Assets Reconstruction Private Limited has also issued the no dues certificate dated 20.12.2021certifying that the borrower and guarantor did not owe them any further dues in respect of the credit facilities availed on behalf of Deve Sugars Limited in favour of Pegasus Assets Reconstruction Private Limited and that the title deeds and all other documents attached with the sanction letter dated 18.07.2019 have been returned to the applicant Tungbhadra Sugar Works Limited. 6. The affidavit file....
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....heir payment to be made out from the godown rent collected from the Central Ware Housing Corporation, Bangalore. The learned counsel further submitted that the exdirectors of the company in liquidation have neither filed statement of affairs nor handed over the books and records pertaining to the company in liquidation and the ex-directors have also not co-operated for taking possession of the assets of the company. Therefore, the Official Liquidator issued a notice dated 27.12.2021 to the ex-directors of the company in liquidation seeking clarification on the assets of the company in liquidation, but the ex-directors failed to appear before the Official Liquidator. He also submitted that as per the order dated 29.11.2018 made in C.A.No.673 of 2018, claims from various creditors of the company in liquidation were called for by causing publication on 20.01.2019 in the newspapers viz., The New Indian Express, Dinamani and Kannada Prabha, thereby fixing 08.02.2019 as the last date for submission of claims in the prescribed format as per the Companies (Court) Rules, 1959. He also submitted that even prior to the invitation of claims, the Official Liquidator had received voluntary claim....
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....g to the applicant. 9. Heard the learned counsel appearing for the parties. 10. It is not in dispute that Deve Sugars Limited was ordered to be wound up on 16.04.1999 in Company Petition Nos.170 of 1995 & 35 of 1997 and the Official Liquidator took possession of the assets of Deve Sugars Limited situated at Harige village on 28.09.1999. The State Bank of Mysore filed Company Application Nos.1251-1253 of 1999 in the then pending Company Petition No.170 of 1995, seeking leave of the Company Court in the High Court at Madras, to pursue the recovery proceedings before the Debts Recovery Tribunal, Bangalore. By order dated 10.03.2000, this Court granted leave subject to the condition that no coercive steps be taken against the assets of the company Deve Sugars Limited during or after the conclusion of the proceedings before the Tribunal. Thereafter, the Debts Recovery Tribunal, Bangalore issued the recovery certificate dated 15.05.2002 and the State Bank of Mysore filed Company Application No.1300 of 2003 with a prayer that the bank be permitted to seek execution of the recovery certificate. Indisputably, the Court neither heard nor passed any order on the above application, as th....
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....also taking necessary actions for revival of the company for the welfare of 947 workmen, the Supreme Court allowed the impleadment applications. In the meanwhile, the debts of Tapti Machines Private Limited were later assigned to MTitanium Apartments Private Limited vide the deed of assignment dated 06.01.2012. 12.1. Firstly, MTitanium Apartments Private Limited has also filed an affidavit supporting the case of the applicant that they did not make any claim against the applicant as it is a different entity. The affidavit also shows that the liabilities pending to them have been settled outside the Court and no dues are to be received from the company in liquidation, as a result, the 126.14 acres of land, which were mortgaged as collateral security to the State Bank of Mysore, belong to the applicant Tungbhadra Sugar Works Limited. The affidavit also says that they have no objection for handing over the possession of the properties to the applicant by the Official Liquidator. The relevant paragraphs of the affidavit dated 26.11.2021 filed by the Authorised Signatory of MTitanium Apartments Private Limited are extracted hereunder:- "6. I state that the Respondent 3rd Par....
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.... per the list attached thereto from Serial Nos.(i) to (xxi) on 20.10.2021 to the applicant. 12.4. Fourthly, Pegasus Assets Reconstruction Private Limited has also addressed a letter on 20.10.2021 to the Sub Registrar, Shimoga for lifting the lien created on the lands, as the corporate guarantor M/s Tungbhadra Sugar Works Limited had settled the account of the borrower. In view of the above, when the charge against the properties is completely lifted, the applicant is entitled to the possession of the subject land including the plant and machinery. 12.5. Fifthly, the applicant is a separate entity with CIN No.U74110MH1957PLC010943 and has been registered with the Registrar of Companies, Mumbai since 24.09.1957 having registered office at G C-1, C Wing, Ground Floor, Gundecha Enclave, Kherani Road, Sakinaka, Andheri East, Mumbai and Deve Sugars Limited is a separate entity with CIN No.U15421TN1993PLC024423 and has been registered with the Registrar of Companies, Chennai. Besides, the Deputy Commissioner, Shimoga also conducted a joint meeting with the Official Liquidator of Deve Sugars Limited and Tungbhadra Sugar Works Limited to clarify the status of Tungbhadra Sugar Works Li....
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....ndmaids of justice and not the mistress of the justice. Therefore, when the rules are framed to advance the cause of justice, in the case on hand, when the parties have settled their disputes, let us not sit on the hyper-technical rules. Therefore, better it is to close the matter accepting the case of the creditors and the debtors that there is no more disputes pending between them. 14. In view of the above, it may be restated that when Tungbhadra Sugar Works Limited addressed a letter to the State Bank of Mysore for creation of mortgage by deposit of title deeds in respect of the loans of Deve Sugars Limited, the applicant has confirmed that even after the execution of the agreement dated 15.01.1994, the execution of the conveyance deeds for transfer of properties in favour of Deve Sugars Limited have not been completed yet. In the meanwhile, since the agreement for transfer dated 15.01.1994 was cancelled on 30.09.1998, the rights and liabilities sought to be created by the sale agreement have become non est in the eye of law. Further, when the Company Petition No.170 of 1995 was allowed and Deve Sugars Limited was wound up on 16.04.1999, the Official Liquidator filed applicat....