Andhra Pradesh High Court - Amravati
M/S.Pioneer Alloy Castings Ltd vs The Asst.General Manager on 9 May, 2024
APHC010556562023
IN THE HIGH COURT OF ANDHRA PRADESH
AT AMARAVATI [3311]
(Special Original Jurisdiction)
THURSDAY ,THE NINTH DAY OF MAY
TWO THOUSAND AND TWENTY FOUR
PRESENT
THE HONOURABLE MS JUSTICE B S BHANUMATHI
IA 2 OF 2024
IN
COMPANY APPLICATION NO: 48/2023
Between:
M/s.pioneer Alloy Castings Ltd ...APPELLANT
AND
The Asst General Manager and Others ...RESPONDENT(S)
Counsel for the Appellant:
1. T V P SAI VIHARI(SC FOR OFFICIAL LIQUIDATOR) Counsel for the Respondent(S):
The Court made the following Order:
The Official Liquidator filed the present application for the following reliefs:
i) to approve the highest offer of Kemin Industries South Asia Private Limited for Rs.17,10,46,000/- (Rupees Seventeen Crores Ten Lakhs Forty Six Thousand only) in respect of Lot No.3 i.e., consolidated and composite of entire assets/properties as mentioned in Lot No.1 & Lot No.2 and directions may kindly be issued to the above successful bidder to deposit the balance sale consideration of Rs.16,18,13,000/- after adjustment of EMD of Rs.92,33,000/- within a period of 30 days as per 2 I.A.No.2 of 2024 in COMP.A.No.48 of 2023 the terms and conditions of sale or within such time as decided by this Court, since the offer of Lot No.1 and Lot No.2 are not accepted as it is on lower side (less than 63.4%) compared with Lot No.3;
ii) to confirm the sale of assets/properties in favour of Kemin Industries South Asia Private Limited for Lot No.3 (consolidated and composite of entire assets/properties as mentioned in Lot No.1 & Lot No.2) subject to deposit of balance sale consideration as mentioned above within a period of 30 days or within such time as decided by this Court;
iii) to permit the Official Liquidator to handover the possession of assets of the company (in liquidation) in respect of Lot No.3 (consolidated and composite of entire assets/properties as mentioned in Lot No.1 & Lot No.2) to the successful purchaser viz., Kemin Industries South Asia Private Limited, after receipt of entire sale consideration;
iv) to permit the Official Liquidator to refund the EMD amounts of 2nd & 3rd highest bidders of Lot No.3 after receipt of balance sale consideration from the successful purchaser;
v) to permit the Official Liquidator to refund the EMD amount of 1st , 2nd and 3rd highest bidders of Lot No.1 and Lot No.2, after confirmation of sale of Lot No.3 (consolidated and composite of entire assets/properties as mentioned in Lot No.1 & Lot No.2) since the offer of Kemin Industries South Asia Private Limited for Lot No.3 is accepted as highest bid/offer which is more than 63.4% of total offer received in respect of Lot No. 1 & Lot No.2 (both) as detailed in paras No.11 & 12;
vi) to order that the cost of this application to be paid out of the assets of the company; and pass such further or other order or orders, as this Court may deem fit and proper in the circumstances of the case.
02. The averments in the petition are briefly as follows:
(a) By an order dated 09.11.2012 in C.P.No.171 of 2011, this Court directed to wound up M/s.Pioneer Alloy Castings Limited and the Official 3 I.A.No.2 of 2024 in COMP.A.No.48 of 2023 Liquidator attached to this Court was appointed as Liquidator of the captioned company.
(b) This Court, vide its order dated 07.02.2024 in I.A.No.1 of 2024 in C.A.No.48 of 2023 in C.P.No.171 of 2011 (filed as annexure-„A‟), which is filed for sale of assets of the company (in liquidation) through e-auction under "three lots" on "as is where is and whatsoever there is basis" by fixing the Minimum Upset Price/Reserve Price, permitted the Official Liquidator to conduct e-auction through e-auction service provider viz., M/s. Rail Tel Corporation of India Limited or M/s. e-Procurement Technologies Limited (Auction Tiger.net) or such other agency, who offers to provide the required service for price less than the price at which the other provider offers the same kind of service.
(c) Accordingly, a meeting was conducted on 06.03.2024 at 11:30 A.M. with the secured creditors of the company viz., State Bank of India and Canbank Factors Limited (the respondent No.1 and 2 herein) to finalize name of the agency and their charges/fee for conducting online e-auction in respect of sale of assets/properties of M/s. Pioneer Alloy Castings Limited (in liquidation). The officers of State Bank of India and Canbank Factors Limited attended the meeting.
(d) In the meeting, e-auction service providers quoted the following rates for conducting the auction:
Sl. Name of the e-auction Amount to be Amount to be charged No. agency charged for for unsuccessful auction successful auction 1 M/s. Rail Tel Corporation A fixed amount of OL shall reimburse the of India Limited Rs.30,000/- will operational cost to be charged from empanelled agency successful bidder which shall not be more for sale price than Rs.10,000/- for 4 I.A.No.2 of 2024 in COMP.A.No.48 of 2023 above Rs.50 every three lots.
lakhs.
2 M/s.e-Procurement Rs.5,000/- + GST Rs.3,000/-+ GST per Technologies per property/per property/per auction/per Limited(Auction Tiger) auction/per block/per lot block/per lot
(e) The amount quoted by Mis. e-Procurements Technologies Limited (Auction Tiger) is lower than the offer quoted by Mis. Rail Tel Corporation of India Limited. The secured creditors have 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 liquidation). A copy of the minutes of the meeting dated 06.03.2024 is enclosed to the application (filed as annexure-„B‟). Accordingly, the Official Liquidator sent an e-mail dated 08.03.2024 to M/s. e-Procurement Technologies Limited (Auction Tiger) requesting to take up the assignment of conducting e-auction of the sale of assets/ properties of the subject company.
(f) The Official Liquidator caused publication of e-auction sale notice on 15.03.2024 in three newspapers namely: (i). "Andhra Jyoti", Telugu daily covering Andhra Pradesh; (ii) "Namaste Telangana", Telugu daily covering Telangana; (iii) "The Economic Times", English daily of all India Editions with DAVP/Government rates for sale of assets/properties of the company on "as is where is and whatsoever there is basis". Further the Official Liquidator paid an amount of Rs.75,759/- to Economic Times and Rs.23,106/- to Namaste Telangana including GST towards publication charges on DAVP/Government rates. On receipt of the bill from the Andhra Jyoti newspaper, the Official Liquidator will make payment of the same on DAVP Government rates. The State Bank of India had caused publication of sale notice on 14.03.2024 in Dinamani, Tamil daily news paper of Chennai edition and the cost of such 5 I.A.No.2 of 2024 in COMP.A.No.48 of 2023 publication expenses is borne by SBI. The sale of notice published in the news papers are enclosed to the application (filed as annexure-„C‟).
(g) As per the schedule, the Official Liquidator deputed his officials to facilitate the intending purchasers to have inspection of the assets of the Company (in liquidation) located at Gummidipoondi, within the village limits of Pappankuppam and Karumbukuppam, Thiruvallur District, Tamilnadu on 01.04.2024 and 02.04.2024 between 11:00 A.M. to 05:00 P.M. In response, about 43 intending bidders inspected the assets/properties of the company (in liquidation) on the above mentioned dates. Copy of the terms and conditions and bid form provided to the intending bidders are enclosed to the application (filed as annexure-„D‟).
(h) As per the sale notice, the last date of submission of EMD was 18.04.2024 and as per the Bank Statement of EMD Account maintained with Punjab National Bank, Bank Street Branch, Koti, Hyderabad, the EMD has been received from the 38 intending bidders in respect of three lots and the lot wise details are as follows:
Lot No. Earnest Money Deposit Number of bidders (EMD) (Amount in submitted EMD lakhs) amount 1 84.10 2 2 8.23 31 3 92.33 5 (consolidated and composite of lot No.1 and lot No.2) Total 38
(i) As per the information provided by e-auction service provider M/s. e-
Procurement Technologies Limited (Auction Tiger), the following bidders have 6 I.A.No.2 of 2024 in COMP.A.No.48 of 2023 submitted their Bid Forms in respect of Lot No.1, 2 and 3. (filed as annexures
-„E‟, „F‟ and „G‟) [collectively].
Lot No.1:
Allowed to
Bid amount
Sl.No. Name of the Bidder participate in
quoted
Bidding
1 SIM Traders 8,41,50,000/- Yes
2 Imran Steel 8,42,00,000/- Yes
3 Hadith Enterprises Nil Not allowed as EMD
amount was not
deposited.
[(Leasehold Land to an extent of Ac.6.00 cents together with Buildings) - Minimum Upset Price/Reserve Price - Rs.8,41,00,000/- and EMD - Rs.84,10,000/-.] Lot No.2:
Allowed to
Bid amount
Sl.No. Name of the Bidder participate in
quoted
Bidding
1 Anton Engineering 82,76,000/- Yes
Rep.by Zitavijay
2 Classic Timber 82,26,000/- Yes
Rep,by proprietor Khader
M.S.A
7
I.A.No.2 of 2024 in
COMP.A.No.48 of 2023
3 Gulshan Steels 82,26,000/- Yes
Rep. by Ahmed Ali
Chaudhary
4 AA Associates 82,26,000/- Yes
5 Arihant Enterprise 82,26,000/- Yes
Rep. by Sameer Kumar
Gupta
6 KR Metal Engineering 82,26,000/- Yes
Company
7 ERAM Enterprises 82,26,000/- Yes
8 Sareen Steel Industries 82,30,000/- Yes
Rep. by Prop. Sunny
Sareen
9 SIM Traders 88,50,000/- Yes
10 Imran Steel 87,00,000/- Yes
11 Perfect Metal Recyclers 83,00,000/- Yes
Rep. by Abdul Sameer G
12 Timber House 82,30,000/- Yes
Rep.by N.A.Thameem
13 SYM Singhal Alloys 82,30,000/- Yes
Rep.by YogeshSinghal
14 ABM Enterprises 82,26,000/- Yes
15 SPAHJ INDIA TRADING 1,01,00,300/- Yes
(P) LTD.Rep. by Abhijith.A
8
I.A.No.2 of 2024 in
COMP.A.No.48 of 2023
16 Ascon Engineers, 82,26,000/- Yes
Rep.by AaftabAalam Khan
17 Metal World 82,30,000/- Yes
18 SRS Enterprises 87,00,000/- Yes
Rep. by Salam Khan
19 Aayee Kay Enterprises 82,26,000/- Yes
20 M/s.JK Trading 83,00,000/- Yes
Corporation
Rep. by Mr.Navin Kumar,
21 Sree Scrap Iron Works 82,26,000/- Yes
Hyd
Rep.by Sandeep Sarf
22 Hadith Enterprises Nil Not allowed as
EMD amount
was not
deposited.
[(Plant & Machinery) - Minimum Upset Price / Reserve Price - Rs.82,26,000/-and EMD -
Rs.8,23,000/-.] Lot No.3:
Allowed to
Bid amount
Sl.No. Name of the Bidder participate in
quoted
Bidding
1 Hadith Enterprises 9,23,26,000/- Yes
Rep.by Kasali
9
I.A.No.2 of 2024 in
COMP.A.No.48 of 2023
Mohammed
2 Poddar Global Private 9,25,66,000/- Yes
Limited.
3 KeminIndustries South 9,23,26,000/- Yes
Asia Private Limited
4 Heaven Blanc Energy 9,24,36,000/- Yes
Private Limited,
5 Sri Sai Enterprises 9,23,26,000/- Yes
rep.by Mr.Gowtham,
[(Consolidated and Composite of entire assets / properties as mentioned in Lot No.1 & Lot No.2) - Minimum Upset Price/Reserve Price -
Rs.9,23,26,000/- and EMD - Rs.2,40,000/-.]
(j) On 23.04.2024, the e-auction of the assets/properties of the subject company through web portal was started at 11:30 A.M. Auction for Lot No.1 was continued till 02:46 P.M, for Lot No.2 till 04:04 P.M. and for Lot No.3 till 09:00 PM (night) and the details of initial bid started for each lot are as under:
Lot No.1 Rs.8,42,00,000/-
Lot No.2 Rs.1,01,00,300/-
Lot No.3 Rs.9,25,66,000/-
(k) After completion of the e-auction, three e-mails dated 23.04.2024 were received from the e-auction service provider i.e., M/s. e-Procurement Technologies Ltd. (Auction Tiger). The details of item wise (lot wise) break up 10 I.A.No.2 of 2024 in COMP.A.No.48 of 2023 of bid and the name of the bidders along with their bid amount and rank filed as annexure-„H‟, „I‟ and ‟J‟) [collectively] are as under:
Lot No.1:
Highest Bid
Name of the Amount Bid Amount (in Rs. in
Rank
Bidder words)
(inRs. in Fig.)
Imran Steel 8,46,00,000/- Eight Crore Forty-Six Lakh 1
SIM Traders 8,44,00,000/- Eight Crore Forty-Four 2
Lakh
Lot No.2
Highest Bid
Name of the Amount
Bid Amount (in Rs. in words) Rank
Bidder (in Rs. in
Fig.)
Imran Steel 2,00,60,300/- Two Crore Sixty Thousand 1
Three Hundred
Anton 1,98,20,300/- One CroreNinty-Eight Lakh 2
Engineering Twenty Thousand Three
Hundred
SIM Traders 1,86,60,300/- One Crore Eighty-Six Lakh 3
Sixty Thousand Three
Hundred
Arihant 1,46,60,300/- One Crore Forty-Six Lakh 4
11
I.A.No.2 of 2024 in
COMP.A.No.48 of 2023
Enterprise Sixty Thousand Three
Hundred
SPAHJ India 1,42,60,300/- One Crore Forty-Two Lakh 5 Trading Sixty Thousand Three Private Hundred Limited SymSinghal 1,40,60,300/- One Crore Forty Lakh Sixty 6 Alloys Thousand Three Hundred J.K.Trading 1,17,80,300/- One Crore Seventeen Lakh 7 Corporation Eighty Thousand Three Hundred Sree Scrap 1,12,20,300/- One Crore Twelve Lakh 8 Iron Works Twenty Thousand Three Hyd Hundred Timber 1,09,40,300/- One Crore Nine Lakh Forty 9 House Thousand Three Hundred ERAM 1,06,20,300/- One Crore Six Lakh Twenty 10 Enterprises Thousand Three Hundred Perfect Metal 1,03,40,300/- One Crore Three Lakh Forty 11 Recyclers Thousand Three Hundred Sareen Steel 1,01,40,300/- One Crore One Lakh Forty 12 Industries Thousand Three Hundred 12 I.A.No.2 of 2024 in COMP.A.No.48 of 2023 Lot No.3 Highest Bid Name of the Amount Bid Amount (in Rs. in Rank Bidder words) (inRs. in Fig.) Kemin Industries 17,10,46,000/- Seventeen CroreTen 1 South Asia Private Lakh Forty-Six Limited Thousand Poddar Global 17,03,26,000/- Seventeen Crore Three 2 Private Limited Lakh Twenty-Six Thousand Hadith Enterprises 12,83,26,000/- Twelve Crore Eighty- 3 Three Lakh Twenty-Six Thousand Heaven Blanc 12,18,46,000/- Twelve Crore Eighteen 4 Energy Private Lakh Forty-Six Limited Thousand Sri Sai 12,04,06,000/- Twelve Crore Four Lakh 5 Enterprises Six Thousand
(l) As per the information provided by the e-auction service provider (Auction Tiger), the following are the highest bidders for each lot:
8,46,00,000/-
Lot No.1 Imran Steel (Eight Crore Forty Six Lakh) 2,00,60,300/-
Lot No.2 Imran Steel
(Two Crore Sixty
13
I.A.No.2 of 2024 in
COMP.A.No.48 of 2023
Thousand Three
Hundred)
10,46,60,300/-
(8,46,00,000/-
Total Highest Bid
+ 2,00,60,300/-)
Amount (Lot No.1 +
(Ten Crore Forty Six
Lot No.2)
Lakh Sixty Thousand
Three Hundred)
Lot No.3 17,10,46,000/-
(consolidate and Kemin Industries South (Seventeen Crore Ten
composite of Lot Asia Private Limited Lakh Forty Six
No.1 & 2) Thousand)
8,46,00,000/-
Lot No.1 Imran Steel (Eight Crore Forty Six
Lakh)
(m) As per the sale notice dated 12.03.2024, priority will be given to the bidders who submit their bid for Lot No.3 (consolidated and composite of Lot No.1 & Lot No.2). Hence, in the present case as stated above, the combined highest offer received for Lot No.1 and Lot No.2 is Rs.10,46,60,300/-
(Rs.8,46,00,000/- + Rs.2,00,60,300/-), whereas the highest offer received for Lot No.3 (consolidate and composite of Lot No.1 & 2) is Rs.17,10,46,000/-, which is more than 63.4% of the total highest offers received in respect of Lot No.1 and Lot No.2 (both).
(n) A meeting was called for with the secured creditors, namely, State Bank of India and Canbank Factors Limited, on 26.04.2024 to update the information of e-auction proceedings received from the e-auction service providers i.e., M/s. e-Procurement Technologies Limited (Auction Tiger) regarding the sale of assets/properties of the subject company (in liquidation) held on 23.04.2024 and discuss about highest offer. The details of the bids 14 I.A.No.2 of 2024 in COMP.A.No.48 of 2023 received in respect of each lot and the highest offers received for respective lots were informed to the secured creditors. The secured creditors opined that the offer received for Lot No.3 is on the higher side and same is more than 63.4% of the total highest offers received in respect of Lot No.1 and Lot No.2 (both), and as per the sale notice dated 12.03.2024, priority will to be given to the bidder who submit their highest bid for Lot No.3 (consolidated and composite of Lot No.1 & Lot No.2). The secured creditors opined also that the sale of Lot No.3 (consolidate and composite of Lot No.1 & Lot No.2) shall be confirmed in favour of the highest bidder i.e. Kemin Industries South Asia Private Limited, subject to approval of this Court.
(o) The secured creditor requested the Official Liquidator to place the highest offer of Kemin Industries South Asia Private Limited in respect of Lot No.3 (consolidate and composite of Lot No.1 & Lot No.2) before this Court seeking approval and confirmation of sale in their favour. Copy of the minutes dated 26.04.2024 is enclosed to the application (filed as annexure-„K‟).
03. The Official Liquidator requested this Court to take on record the highest offer received for lot No.3 against the Minimum Upset Price/Reserve Price of fixed by this Court as tabulated below and approve the highest offer given by Kemin Industries South Asia Private Limited.
Lot No. Name of the Final Bid Amount Minimum Upset Highest Bidder quoted Price/Reserve Price Lot No.3 Kemin Rs.17,10,46,000/- Rs.9,23,26,000/-
Industries South (Seventeen Crore (consolidate Asia Private Ten Lakh Forty and Limited Six Thousand) composite of Lot No.1 & 2) 15 I.A.No.2 of 2024 in COMP.A.No.48 of 2023
04. In view of the aforesaid facts and circumstances, and the documents filed in support thereof, the application is allowed as prayed for.
________________________ JUSTICE B.S.BHANUMATHI Date: 09.05.2024.
CC by 15.05.2024.
b/o NSM