Andhra Pradesh High Court - Amravati
M/Sj. Sree Pujitha Chit Fund P Ltd In Liqn vs Nil on 30 January, 2025
APHC010431472022
IN THE HIGH COURT OF ANDHRA PRADESH
AT AMARAVATI [3311]
(Special Original Jurisdiction)
THURSDAY, THE THIRTIETH DAY OF JANUARY
TWO THOUSAND AND TWENTY FIVE
PRESENT
THE HONOURABLE MS JUSTICE B S BHANUMATHI
IA 1 OF 2025
IN
COMPANY APPLICATION NO: 9/2022
Between:
M/s. Sree Pujitha Chit Fund (P) Ltd (in Liqn) ...APPELLANT
AND
Nil ...RESPONDENT
Counsel for the Appellant:
1. T V P SAI VIHARI(SC FOR OFFICIAL LIQUIDATOR)
Counsel for the Respondent:
1.
The Court made the following:
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ORDER:
This application is filed under Section 457(1)(c) of the Companies Act., 1956 read with Rule 9 and 11 (b) of the Companies (Court) Rules, 1959 seeking the following reliefs:
i. As no offer is received in the e-auction conducted on 08-11-2024, permit the Official Liquidator to sell the entire assets/properties of the company (in liquidation) through e-auction on "as is where is and whatsoever there is basis" by fixing the Reserve Price, 10% of Reserve Price as EMD and incremental bid amount as decided in the Asset Sale Committee Meeting held on 20-01-2025 which are as under;
Description of Properties Reserve price Earnest Money Incremental
( (Rs. in lakhs) Deposit Bid Amount
(E.M.D.) (in Rupees)
(Rs. in lakhs)
RCC roofed Commercial 106 10.60 30,000/-
Block admeasuring 1923 Sq.
feet (including common
area), situated at South East
Office Block in Upper
Ground Floor, Ammana
Estates, Door No.29-36-37,
Prakasam Road,
Governorpet, Vijayawada,
NTR District, Andhra
Pradesh, alongwith Movable
Assets (Machinery and
Equipment) such as
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I.A.No.1 of 2025 in
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Furniture, Window/Split A/c,
Safety locker, Computer,
electrical equipment & office
equipment etc.
After e-auction, this Court may be pleased to permit the Asset Sale Committee to conduct negotiations with the three (3) highest bidders who have participated in e-auction to fetch maximum sale price, if necessary.
ii. to permit the Official Liquidator to sell the above assets/properties of the company (in liquidation) through e-auction service provider viz., M/s. Rail Tel Corporation of India Limited or M/s. e- Procurement Technologies Ltd. (auction Tiger) or such other agency whoever will offer the lower service charge as this Court may deem fit and proper in this regard and to release the service charges to e-auction service provider out of the funds lying to the credit of the company (In Liqn.).
iii. to consider and approve the draft e-auction sale notice, Terms & Conditions and online e-auction Bid Form for sale of above assets/properties of the company (in liquidation) which are annexed vide (Annexure-"D").
iv. to permit the Official Liquidator to publish e-auction sale notice for sale of above assets / properties of the company (in liquidation) on "as is where is and whatsoever there is basis" in three newspapers namely (i) "The Economic Times", English Daily News Paper, All India Editions (ii) "Namasthe Telangana"
Telugu Daily News Paper, all editions covering the state of Telangana and (iii) "Andhra Jyothi", Telugu Daily News Paper, all editions covering the state of Andhra Pradesh or any other 4 I.A.No.1 of 2025 in COMPA.No.9 of 2022 news papers as decided by this Court at DAVP / Govt. rates as this office is a Central Government office attached to High Court of Telangana & Andhra Pradesh and also permit the Official Liquidator to release the publication charges to above newspaper companies out of the funds lying to the credit of the company (In Liqn.).
v. to permit the Official Liquidator to fix and receive Rs.2,000/- (Non-
refundable & non-adjustable) towards participation fee from each intending bidder.
vi. to permit the Official Liquidator to return the EMD amount to the unsuccessful bidders after retaining the EMD amount of 1st, 2nd and 3rd highest bidders participated in the e-auction till confirmation of sale by this Court and deposit of balance sale consideration by the Successful/Highest bidder.
vii. to permit the Official Liquidator to amend/alter/modify the sale notice to be displayed on web portal as per the procedure/ norms of the e-auction service provider.
viii. to order the cost of this application do come out of the funds available to the credit of the company (In Liqn.).
ix. to pass such further or other order or orders as this High Court may deem fit and proper in the circumstances of the case.
02. The averments made in the accompanying affidavit are as follows:
a. By order dated 07-10-2010, made in C.P.No.28/2010, M/s.Sree Pujitha Chit Fund (P) Limited was ordered to be wound up by the High Court of Judicature at Hyderabad and the Official Liquidator 5 I.A.No.1 of 2025 in COMPA.No.9 of 2022 attached to this Court was appointed as Liquidator of the captioned company.
b. This Court, vide its order dated 29-08-2024 made in I.A No.1/2024 in C.A.No.9/2022 in C.P.No.28/2010, allowed the application filed for sale of assets situated at Upper Ground Floor, Door No.29-36-37, Ammana Estates, Museum Road, Governorpet, Vijayawada, NTR District, Andhra Pradesh, through e-auction on "as is where is and whatsoever there is basis" by fixing the following reserve price, earnest money deposit(EMD), incremental bid amount as detailed below:
Description of the Reserve Price (E.M.D.) Incremental assets/properties and Rs. Rs. Bid Amount situation thereof. Rs.
Flat (RCC roofed Commercial Block) 1,19,50,000/- 11,95,000/- 1,00,000/- admeasuring 1923 Sq.feet (Non (including common area), interest situated at Upper Ground bearing) Floor, Door No.29-36-37, Ammana Estates, Museum Road, Governorpet, Vijayawada, NTR District, Andhra Pradesh, alongwith Machinery and Equipment such as Furniture, Window/Split A/c, Safety locker, Computer, electrical equipment & office equipment, etc. 6 I.A.No.1 of 2025 in COMPA.No.9 of 2022
c. In order to comply with the order of this High Court, a meeting of Assets Sale Committee comprising of Official Liquidator, Assistant Official Liquidator and Senior Technical Assistant was conducted on 20-09-2024 at 5:00 P.M. to finalize the name of the agency and their charges / fee for conducting online e-auction in respect of sale of assets/properties of M/s. Sree Pujitha Chit Fund (P) Limited (In Liqn). In the meeting, it was discussed about the rates/fees quoted by M/s.Rail Tel Corporation of India Limited and M/s. e-Procurement Technologies Ltd. (auction Tiger.net), which are as under:
Sl.No. Name of the e-auction Amount to be Amount to be Agency charged charged (successful (unsuccessful auction) auction) 1 M/s. Rail Tel A fixed amount of OL shall Corporation of India Rs.30,000/- will be reimburse the Limited charged from operational cost successful bidder to empanelled for sale price above agency which Rs.50 Lakhs. shall not be more than Rs.10,000/- for every three lots.
2 M/s. e-Procurement Rs.5,000/- + GST Rs.3,000/- +
Technologies Ltd., Per property / Per GST
(Auction Tiger) Auction / Per Block Per property /
/ Per Lot Per Auction /
Per Block / Per
Lot.
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Since, the amount quoted by M/s. e-Procurement Technologies Ltd. (Auction Tiger) was lower than the offer quoted by M/s. Rail Tel Corporation of India Limited, the Assets Sale Committee suggested to utilize the services of M/s. e-Procurement Technologies Ltd.
(Auction Tiger) for conducting online e-auction for sale of assets of the subject company (In Liqn.). Accordingly, the Official Liquidator sent an e-mail dated 23-09-2024 to M/s. e-Procurement Technologies Limited (Auction Tiger) requesting to give acceptance for taking up the assignment of conducting e-auction of the sale of assets/ properties of the subject company. The e-auction service provider (Auction Tiger), vide e-mail dated 24-09-2024 accepted the offer to act as e-auction service provider for auction of properties of M/s. Sree Pujitha Chit Fund (P) Limited (In Liqn).
d. The Official Liquidator caused publication of e-auction sale notice on 30/09/2024 in three newspapers namely (i) "The Times of India", English Daily News Paper covering Andhra Pradesh and Telangana Editions, (ii) "Namaste Telangana", Telugu Daily News Paper, all editions of Telangana and (iii) "Andhra Jyothi", Telugu Daily News Paper, all editions of Andhra Pradesh at DAVP/ government rates for sale of assets / properties of the company on "as is where is and whatsoever there is basis". The above sale notice was also uploaded in the Ministry of Corporate Affairs (MCA) portal for public information and also sent to the Institute of Chartered Accountants of India, Institute of Company Secretaries of India, Institute of Cost and Works Accountants of India, The Federation of Telangana Chamber of Commerce and Industry, Andhra Chamber of Commerce for vide publicity of sale. Further, as 8 I.A.No.1 of 2025 in COMPA.No.9 of 2022 per the Sale Notice, the following were the schedule dates for sale of above assets / properties.
Date of Inspection of 18-10-2024 &19-10-2024 assets/properties Between 11.00 A.M. & 5.00 P.M Last date for submission of 05-11-2024 upto 4.00 P.M. EMD Last date for submission of 06-11-2024 upto 4.00 P.M. Online offer / bid Date of e-auction 08-11-2024 11.30 A.M to 2.30 P.M. Further, the Official Liquidator also sent the sale notice and terms & conditions to the e-auctioneer viz. M/s. e-Procurement Technologies Ltd. (auction Tiger.net) requesting them to upload the same on their web portal.
e. As per the schedule, the Official Liquidator deputed his officials to facilitate the intending purchasers to have inspection of the above said assets/properties situated at Upper Ground Floor, Door No.29- 36-37, Ammana Estates, Museum Road, Governorpet, Vijayawada, NTR District, on 18-10-2024 and 19-10-2024 between 11:00 A.M to 5:00 P.M. In response, about three (3) intending bidders inspected the assets/properties of the company (In Liqn.) on the above mentioned dates. However, no bidder deposited the EMD amount till the last date of submission of EMD i.e. 05-11-2024 upto 4.00 P.M. Therefore, the e-auction was not conducted by the e-auction service provider i.e. M/s. e-Procurement Technologies Ltd. (Auction Tiger) as per the schedule on 08-11-2024. The said fact was placed before this Court vide report dated 11-12-2024.
9I.A.No.1 of 2025 in COMPA.No.9 of 2022 f. An Assets Sale Committee's meeting was held with an agenda to discuss about the fresh sale of assets through e-auction by reducing the reserve price of the assets/properties below the realizable value and other modalities of sale.
g. In the Assets Sale Committee's meeting, it was observed that as per the valuation report submitted by the valuer Shri Raja. H. Venkata Satya, the values of the assets/properties are as under:-
Sl. Description of property Fair Market Realizable No. Value Value Rs. Rs.
1 RCC roofed Commercial Block 1,30,76,000/- 1,17,68,000/-
admeasuring 1923 Sq. feet
(10% less
(including common area), situated than the fair at South East Office Block in Upper market value) Ground Floor, Ammana Estates, Door No. 29-36-37, Prakasam Road, Governorpet, Vijayawada, NTR District, Andhra Pradesh .
2. Movable Assets (Machinery and 1,82,000/- 1,82,000/-
Equipment) such as Furniture, Window/Split A/c, Safety locker, Computer, electrical equipment & office equipment, etc. (as per list attached with valuation report) situated at South East Office Block in Upper Ground Floor, Ammana Estates, Door No. 29-36-37, Prakasam Road, Governorpet, 10 I.A.No.1 of 2025 in COMPA.No.9 of 2022 Vijayawada, NTR District, Andhra Pradesh.
Total 1,32,58,000/- 1,19,50,000/-
In valuation report, the valuer given the fair market value and realizable value only and had not given the distress value. This office attempted two times for sale of the assets/properties viz., first time on 15-03-2024 as per the fair market value of Rs.1,32,58,000/- and second time on 08-11-2024 as per realizable value of Rs.1,19,50,000/- given by the valuer in the valuation report and both the sale attempts are unsuccessful.
As the Distress Value is not mentioned in the valuation report, a letter dated 03-12-2024 has been issued to the said valuer i.e. Shri Raja. H. Venkata Satya requesting to furnish the distress value of above assets. In response an e-mail dated 19-12-2024, alongwith copy of letter dated 05-12-2024, is received from the valuer and he furnished the values of the fixed assets/immovable assets, including distress value as Rs.91,53,000/- (rupees ninety one lakhs fifty three thousand only). A copy of the said letter of the valuer (Annexure-
"A") was enclosed with the affidavit. Further, the valuer did not provide distress value of movable assets. Hence, this office once again sent an e-mail dated 23-12-2024 to the said valuer and requested to furnish the distress value of movable assets. In response, the valuer, vide e-mail dated 24-12-2024, furnished the values of the movable assets, including distress value as Rs.1,27,000/- (rupees one lakh twenty seven thousand only). A copy of the said letter of the valuer (Annexure-"B") was enclosed with the affidavit.11
I.A.No.1 of 2025 in COMPA.No.9 of 2022 h. After receiving the distress sale value from the valuer for both immovable assets and movable assets, the meeting of Assets Sale Committee was held on 20-01-2025 to fix the reserve price, EMD, incremental bid amount for sale of below mentioned assets/properties of the company (In Liqn.). In the meeting it was observed that, as per the letters dated 05-12-2024 and 24-12-2024 received through e-mail from the valuer, Shri Raja. H.Venkata Satya, the values of assets including distress value are as under:-
Sl. Description of Fair Market Realizable Distress Value No. property Value Value Rs.
Rs. Rs.
1 RCC roofed 1,30,76,000/- 1,17,68,000/- 91,53,000/-
Commercial Block (10% less than (30% less than
admeasuring 1923 the fair market the fair market
Sq. feet (including value value
common area), approximately) approximately)
situated at South
East Office Block in
Upper Ground
Floor, Ammana
Estates, Door No.
29-36-37,
Prakasam Road,
Governorpet,
Vijayawada, NTR
District, Andhra
Pradesh.
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2 Movable Assets 1,82,000/- 1,55,000/- 1,27,000/-
(Machinery and (15% less than (30% less than
Equipment) such as the fair market the fair market
Furniture,Window/ value value
split A/c, Safety approximately) approximately)
locker, Computer,
electrical
equipment & office
equipment, etc. (as
per list attached
with valuation
report) situated at
South East Office
Block in Upper
Ground Floor,
Ammana Estates,
Door No. 29-36-37,
Prakasam Road,
Governorpet,
Vijayawada, NTR
District, Andhra
Pradesh.
Total (1 + 2) 1,32,58,000/- 1,19,23,000/- 92,80,000/-
In the present case, the valuer took the distress value as 70% on fair market value for fixed assets/immovable assets i.e. Rs.1,30,76,000/- x 70% = Rs.91,53,200/- rounded to Rs.91,53,000/- and 70% on fair market value for movable property i.e. Rs.1,82,000/- x 70% = Rs.1,27,400/- rounded to Rs.1,27,000/-.13
I.A.No.1 of 2025 in COMPA.No.9 of 2022 It is observed that, in other sale matters of the company (In Liqn.), the other valuers had given the distress sale value @ 80% of fair market value/present fair value.
i. In the meeting, it was observed that, in case of fixed assets/ immovable assets, the average of the realizable value & distress Value (i.e.Rs.1,17,68,000 + Rs.91,53,000)/2) comes to Rs.1,04,60,500/- which is 80% of the fair market value and it was decided to fix the same as reserve price.
Also, in case of movable assets (machinery & equipment), the average of realizable value & distress value (i.e. Rs.1,55,000/- + Rs.1,27,000/- /2) comes to Rs.1,41,000/- which is around 77% of the fair market value given by the valuer.
In view of the above and make parity with other sale matters, the Asset Sale Committee, after due discussion, decided to fix 80% of fair market value as reserve price for both immovable asset (commercial block) and movable assets (machinery & equipment). Thus, 80% of fair market value of commercial block is taken as reserve price which comes to Rs.1,04,60,800/- (Rs.1,30,76,000/- x 80%) and in respect of movable assets (machinery & equipment) 80% of fair market value was taken as reserve price which comes to Rs.1,45,600/- (Rs.1,82,000 x 80%).
Total reserve price for both immovable asset (commercial block) and movable assets comes to Rs.1,06,06,400/-
(Rs.1,04,60,800/- + Rs.1,45,600/-) rounded to Rs.1,06,00,000/-.
j. The Assets Sale Committee, after due discussion, suggested that the movable assets (machinery & equipment) are too old and have very less realizable value and in earlier sale in last two occasions, 14 I.A.No.1 of 2025 in COMPA.No.9 of 2022 both immovable & movable assets were put for sale in a single lot only. Hence, the entire assets comprising of immovable and movable assets (machinery & equipment) may be put for sale together in present sale.
k. The Assets Sale Committee further decided that the EMD for such sale of assets may be 10% of reserve price i.e. Rs.10.60 lakhs and incremental bid amount be Rs.30,000/-. The sale of above assets may be made through e-auction. The details of reserve price, earnest money deposit (E.M.D.) and incremental bid amount as decided by Assets Sale Committee are as follows:
Description of the Reserve price Earnest Money Incremental Assets/Properties (Rs. in lakhs) Deposit Bid Amount (E.M.D.) (Amount in (Rs. in lakhs) Rs.) RCC roofed Commercial 106 10.60 30,000/-
Block admeasuring 1923 Sq. feet (including common area), situated at South East Office Block in Upper Ground Floor, Ammana Estates, Door No.29-36-37, Prakasam Road, Governorpet, Vijayawada, NTR District, Andhra Pradesh, alongwith Movable Assets (Machinery and Equipment) such as Furniture, Window/Split A/c, Safety locker, 15 I.A.No.1 of 2025 in COMPA.No.9 of 2022 Computer, electrical equipment & office equipment etc.
It was proposed by the Assets Sale Committee for publication of sale notice for sale of above assets/properties of the company (in liquidation) on "as is where is and whatsoever there is basis" in three newspapers namely (i) "The Economic Times", English Daily News Paper, All India Editions (ii) "Namasthe Telangana", Telugu Daily News Paper, all editions covering the state of Telangana and
(iii) "Andhra Jyothi", Telugu Daily News Paper, all editions covering the state of Andhra Pradesh or any other news papers as decided by the Court at DAVP / Govt. rates as this office is a Central Government office attached to the High Court's of Telangana & Andhra Pradesh States.
l. In the earlier occasions, this office sold the assets of some of the companies (In Liqn.) through e-auction conducted by M/s. e- Procurement Technologies Ltd. (auction Tiger) who offers lower service charges as per the orders of the High Court. Further, during the discussions, the Assets Sale Committee suggested for e-auction of above assets of the company (In Liqn.) through M/s. Rail Tel Corporation of India Limited (as suggested by the Ministry vide letter dated 24-11-2020) or M/s. e-Procurement Technologies Ltd. (auction Tiger.net) or any other service provider whoever will offer the lower service charge as decided by the High Court. A copy of the Minutes of Assets Sale Committee meeting dated 20-01-2025 (Annexure - "C") is enclosed with the affidavit.
16I.A.No.1 of 2025 in COMPA.No.9 of 2022 m. In view of the above, it was requested to permit the Official Liquidator to sell the above assets/properties on "as is where is and whatsoever there is basis" through e-auction by availing the services of e-auction service provider viz., M/s. Rail Tel Corporation of India Limited or M/s. e-Procurement Technologies Ltd. (auction Tiger) or any other service provider whoever will offer the lower service charge as decided by this Court and permit the Official Liquidator to release the service charges to e-auction service provider out of the funds available in the credit of the company (In Liqn.).
n. It was requested to permit the Official Liquidator to publish the e- auction sale notice in the following newspapers as decided by the Asset Sale Committee in the meeting held on 20-01-2025 or such other newspapers at DAVP/Govt. rates and also permit the Official Liquidator to release the publication charges out of the funds lying to the credit of the company (In Liqn.).
Name of the Language Editions Remarks Newspaper The Economic Times English All India Editions Namasthe Telangana Telugu All editions DAVP/Govt.
covering the State
rates
of Telangana
Andhra Jyothi Telugu All editions
covering the State
of Andhra
Pradesh
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In this regard draft e-auction sale notice, terms & conditions and online e-auction bid form (Annexure-"D") are enclosed with the petition.
o. It was requested to permit the Official Liquidator to sell the entire assets/properties of the company (in liquidation) in single lot as decided in the Assets Sale Committee meeting held on 20-01-2025 through e-auction on "as is where is and whatsoever there is basis"
by fixing the reserve price, EMD as 10% of reserve price and incremental bid amount which are as given below:
Description of the Reserve Price Earnest Money Incremental Assets/Properties (Rs. in lakhs) Deposit Bid Amount (E.M.D.) (Amount in (Rs. in lakhs) Rs.) RCC roofed Commercial 106 10.60 30,000/-
Block admeasuring 1923 (Non interest Sq. feet (including bearing) common area), situated at South East Office Block in Upper Ground Floor, Ammana Estates, Door No.29-36-37, Prakasam Road, Governorpet, Vijayawada, NTR District, Andhra Pradesh, alongwith Movable Assets (Machinery and Equipment) such as 18 I.A.No.1 of 2025 in COMPA.No.9 of 2022 Furniture, Window/Split A/c, Safety locker, Computer, electrical equipment & office equipment etc.
p. It was requested to permit the Assets Sale Committee to conduct negotiations, after e-auction, with the three (3) highest bidders who have participated in e-auction to fetch the maximum sale price, if necessary.
03. Heard the learned Standing Counsel for the Official Liquidator.
04. For the reasons stated in the affidavit, the Official Liquidator is permitted to:
a. to sell the above assets/properties on "as is where is and whatsoever there is basis" through e-auction by availing the services of e-auction service provider viz., M/s. Rail Tel Corporation of India Limited or M/s. e-Procurement Technologies Ltd. (auction Tiger) or any other service provider whoever will offer the lower service charge as decided by this Court and permit the Official Liquidator to release the service charges to e- auction service provider out of the funds available in the credit of the company (In Liqn.).
b. to publish the e-auction sale notice in the following news papers as decided by the Assets Sale Committee in the meeting held on 20.01.2025 (or) such other news papers at DAVP/Govt. rates and also to release the publication charges out of the funds lying to the credit of the company (In Liqn.).
Name of the Language Editions Remarks Newspaper The Economic Times English All India Editions 19 I.A.No.1 of 2025 in COMPA.No.9 of 2022 Namasthe Telangana Telugu All editions covering the State DAVP/Govt.
of Telangana rates
Andhra Jyothi Telugu All editions
covering the State
of Andhra
Pradesh
c. to sell the entire assets/properties of the company (in liquidation) in single lot as decided in the Assets Sale Committee meeting held on 20-01-2025 through e-auction on "as is where is and whatsoever there is basis" by fixing the reserve price, EMD as 10% of reserve price and incremental bid amount which are as given below:
Description of the Reserve Price Earnest Money Incremental Assets/Properties (Rs. in lakhs) Deposit Bid Amount (E.M.D.) (Amount in (Rs. in lakhs) Rs.) RCC roofed Commercial 106 10.60 30,000/-
Block admeasuring 1923 (Non interest Sq. feet (including bearing) common area), situated at South East Office Block in Upper Ground Floor, Ammana Estates, Door No.29-36-37, Prakasam Road, Governorpet, Vijayawada, NTR District, Andhra Pradesh, alongwith Movable Assets (Machinery and Equipment) such as Furniture, Window/Split A/c, Safety locker, Computer, electrical equipment & office equipment etc. 20 I.A.No.1 of 2025 in COMPA.No.9 of 2022
and further, the Assets Sale Committee is permitted to conduct negotiations, after e-auction, with the three (3) highest bidders who have participated in e-auction to fetch the maximum sale price, if necessary.
05. Accordingly, the application is allowed.
________________________ JUSTICE B.S.BHANUMATHI Date: 30.01.2025 NSM