Calcutta High Court (Appellete Side)
Steel City Precision Techno (P) Ltd. & ... vs West Bengal Financial Corporation & Ors on 13 July, 2018
Author: Subrata Talukdar
Bench: Subrata Talukdar
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13.07.2018 W.P. 6024 (W) of 2012
S.L.-256(KB)
Steel City Precision Techno (P) Ltd. & Ors.
Versus
West Bengal Financial Corporation & Ors.
Mr. Raghunath Chakaraborty
... For the petitioners.
Mr. Rudra Sankar De
... For the Respondent No.1.
Mr. Saptansu Basu Mr. Soumen Datta Mr. Pinaki Brata Ghosh Ms. Susmita Mazumdar ... For the Respondent No.6.
Party/parties are represented in the order of their name/names as printed above in the cause title.
Under challenge in this writ petition is the execution of sale of mortgaged assets, viz. the Cold Storage in issue by the Respondent/West Bengal Financial Corporation (WBFC) in favour of the Private Respondent No.6.
Mr, Chakraborty, Learned Counsel for the petitioner, alleges that the execution of sale in favour of the Private Respondent No.6 by the WBFC has not been in accordance with either the statute or the agreement by and between the parties. It is relevant to note that the parties, meaning thereby the writ petitioner 2 No.1/Company, WBFC and the State Bank of India entered into a tripartite agreement whereby loan was extended by the WBFC to the petitioner No.1/Company on creation of first charge in favour of WBFC and the second charge in favour of SBI.
It is further relevant to mention that the document annexed to the tripartite agreement, inter alia, disclosed that along with the quantum of land belonging to the petitioner No.1/Company, the plant and machinery attached to the Cold Storage also stood hypothecated.
Mr. Chakraborty submits that the valuation of the assets of the petitioner No.1, as on 6th February, 2008 was far above the charged amount claimed by WBFC on behalf of self and, on behalf of the second charge holder/SBI. It is pointed out that the sale having been executed much below the valuation as disclosed from a Valuer's Report dated 6th February, 2008 to the Supplementary Affidavit of the petitioner, would mean and imply that the petitioner has not been handed out a fair deal by the WBFC.
The additional point argued by Mr. Chakraborty is that the Notice of Sale was not widely 3 advertised as enjoined by the law laid down in 2011 (4) SCC Page 171.
Mr. Chakraborty therefore submits that the execution of sale in favour of the Private Respondent No.6 requires to be set aside by cancelling the Deed of Sale dated 31st of October, 2011.
Mr. De, Learned Counsel appearing on behalf of WBFC, draws the attention of this Court to Section 29 of the State Financial Corporations Act, 1951 (for short the 1951 Act).
Referring to Section 29(4) of the 1951 Act, Mr. De submits that the Corporation is entitled to enforce its debt and, as part of its enforcement procedure first pay the costs, expenses; second, realise its own debt; and third, out of the residue pay creditors such as the second charge holder.
Following the provisions of Section 29(4) (supra), the residual money received out of the proceeds of sale have been paid to the second charge holder/SBI. It is also submitted that the procedure for sale was diligently maintained by WBFC by first serving a notice in January, 2011 under Section 29(1) read with Section 30 of the 1951 Act to the petitioner No.1/Company for 4 recovery of the loan. The sale was then next advertised in two newspapers of repute, viz. Bartaman and The Business Standard on the 8th of February, 2011.
Thereafter, by a further notice dated the 18th of February, 2011 the petitioner No.1/Company was granted the opportunity to bring an equal or better offer of Rs.280.00 lakhs as received by the WBFC from the intending buyer.
It is next submitted that upon exhaustion of all the above noticed steps, the sale was ultimately formalised in favour of the Private Respondent No.6 who gave the best offer in response to the advertisement. Therefore, Mr. De denies infraction of any right qua the petitioner No.1/Company arising out of the execution of sale.
Mr. Basu, Learned Senior Counsel appearing for the Private Respondent No.6/the buyer, draws the attention of this Court to the prayers made in the writ petition. Mr. Basu submits that such prayers cannot be maintained in a writ proceeding. Furthermore, the sale of the Cold Storage has already been completed and the Private Respondent No.6 has taken possession of the same.
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The obligations of the WBFC, the second charge holder/SBI and ultimately the buyer/Private Respondent No.6 stand completed with formalisation of the sale strictly in terms of the 1951 Act.
Having heard the parties and considering the materials placed, this Court is of the view that in the tripartite agreement between the petitioner No.1/Company, the WBFC and the State Bank of India the clear obligations of the contracting parties were made out. The tripartite agreement provided for creating the second charge and, for recovery thereof.
It is also not in dispute that the sale of the Cold Storage was advertised in two newspapers of wide circulation which, in the opinion of this Court, would suffice to attract the attention of prospective buyers.
It is also an admitted factual position that the WBFC followed its obligations both under the statute and under the tripartite agreement by putting the petitioner No.1/Company on notice of the offer received from the intending buyer and, granting the petitioner No.1/Company the opportunity to match such offer.
In the light of the above factual scenario the stand of the petitioners appears to be a post facto 6 exercise aimed at unsettling settled rights and obligations.
This Court is also satisfied that there is no violation of the essential terms laid down at Paragraph 20 of the Judgement of the Hon'ble Apex Court as reported in (2011) 4 SCC 171 (supra) in the facts of the present case.
Before parting with the discussion, it is noticed that in the absence of any palpable infraction made out by the petitioner connected to the contract, the petitioners may not qualify in seeking a remedy in Writ Jurisdiction.
In the above view of the matter, the writ petition fails.
WP No.6024 (W) of 2012 stands accordingly dismissed.
Urgent xerox certified copy of this order, if applied for, be handed over to the parties on compliance of necessary formalities.
(Subrata Talukdar, J.) 7