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Documents citing A. Subbaraya Mudaliar vs K. Sundararajan, (Joint Receiver) And ... on 9 July, 1951

Balleshwar Greens Pvt Ltd vs Official Liquidator Of M/S Omex ... on 11 August, 2014

(b) In 1974, in the case between M/s Kayjay  Ind. (Pvt.) Ltd. vs M/s Asnew Drums (P) Ltd  (1974   2   SCC   213)   Hon'ble   Apex   Court  examined   the   issue   related   to   sale   of  property by Court. True it is that, in the  said decision, Hon'ble Apex Court examined  the issue in light of the provisions under  Order 21 Rule 90. However, the issue about  the   Court's   obligation   in   accepting  previous bid was also considered by Hon'ble  Apex   Court   in   the   said   decision.   Hon'ble  Apex   Court   speaking   through   Hon'ble   Mr.  Justice  V.R.Krishna  Iyer   [as   His   Lordship  then   was]   observed   in   the   said   decision  that:­ "9.........Be   it   by   a   receiver,  commissioner,   liquidator   or   Court   this  principle must govern. This proposition has  been   propounded   in   many   rulings   cited  before us and summed up by the High Courts.  The   expressions   'material   irregularity   in  the   conduct   of   the   sale'   must   be  benignantly  construed   to   cover   the   climax  act of the Court accepting the highest bid.  Indeed, under the Civil Procedure Code, it  is   the   Court   which   conducts   the   sale   its  duty   to   apply   its   mind   to   the   material  factors   bearing   its   mind   to   the   material  Page 171 of 205 O/OJMCA/89/2014 CAV JUDGMENT factors   bearing   on   the   reasonableness   of  the price offered is part of the process of  obtaining a proper price in the course of  the sale.  Therefore, failure to apply its  mind to this aspect of the conduct of the  sale   may   amount   to   material   irregularity  Mere,   substantial   injury   without   material    irregularity is not enough even as   material      irregularity   not   linked   directly   to  inadequacy   of   the   price   is   insufficient.  And where a Court mechanically conducts the  sale or routinely signs assent to the sale  papers, not bothering to see if the offer  is   too  low  and  a   better  price  could  have  been   obtained,   and   in   fact   the   price   is  substantially   inadequate,   there   is   the  presence   of   both   the   elements   of  irregularity and injury.  But it is not as  if   the   Court   should   go   on   adjourning   the  sale till a good price is got, it being a  notorious fact that Court sales and market  prices   are   distant   neighbours.   Otherwise,  decree­holders  can   never   get   the   property  of   the   debtor   sold.   Nor   is   it   right   to  judge   the   unfairness   of   the   price   by  hindsight   wisdom.   May   be,   subsequent  events, not within the ken of the executing  Court when holding the sale, may prove that  had the sale been adjourned a better price  could   have   been   had.   What   is   expected   of  the   Judge   is   not   to   be   a   prophet   but   a  pragmatist and merely to make a realistic  appraisal of the factors, and, if satisfied  that, in the given circumstances, the bid  is acceptable, conclude the sale. The Court  may   consider   the   fair   value   of   the  property, the general economic trends, the  large   sum   required   to   be   produced   by   the  bidder, the formation of a syndicate, the  futility   of   postponements   and   the  possibility   of   litigation,   and   several  other   factors   dependent   on   the   facts   of  each   case.   Once   that   is   done,   the   matter  ends there. No speaking order is called for  Page 172 of 205 O/OJMCA/89/2014 CAV JUDGMENT and no meticulous post mortem is proper. If  the   Court   has   fairly,   even   if   silently,  applied   its   mind   to   the   relevant  considerations   before   it   while   accepting  the   final   bid,   no   probe   in   retrospect   is  permissible.   Otherwise,   a   new   threat   to  certainty   of   Court   sales   will   be  introduced.
Gujarat High Court Cites 56 - Cited by 0 - R M Chhaya - Full Document

Kasturi Commodities Pvt Ltd vs K.Shajahan on 26 July, 2013

34. So, if the principles enunciated in the decisions referred to above are applied to this case, there is no difficulty for us to come to the conclusion that the aspect of adequacy of sale price has not been given due consideration by the learned single Judge, more so when the price offered by the third respondent was less than the minimum price fixed by the Court. As already discussed above, if others also had known that they could offer price for purchase of the vessel less than the minimum price fixed by the Court, perhaps there would have been more offers. We have reason to think so, as during the pendency of hearing before the learned single Judge, and as well as before us, some persons, have come forward offering more price, and assuring that in case sale is confirmed they will pay or deposit money as ordered by the Court. Under the circumstances, and having regard to the position of law stated in the decisions referred in paragraphs 32 and 33 of this judgment, we are unable to sustain the order of the learned single Judge confirming the sale in favour of the third respondent."
Madras High Court Cites 13 - Cited by 1 - R Sudhakar - Full Document

M/S.Om Gurudev Enterprises Through ... vs The Official Liquidator on 22 May, 2020

In A. Subbaraya Mudaliar v. K.Sundarajan(4) it was pointed out that the condition of confirmation by the Court being a safeguard against the property being sold at an inadequate price, it will be not only proper but necessary that the Court in exercising the discretion which it undoubtedly has of accepting or refusing the highest bid at the auction held in pursuance of its orders, should see that the price fetched at the auction, is an adequate price even though there is no suggestion of irregularity or fraud. It is well to bear in mind the other principle which is equally well- settled namely that once the court comes to the conclusion that the price offered is adequate, no subsequent higher offer can constitute a valid ground for refusing confirmation of the sale or offer already received.
Madhya Pradesh High Court Cites 10 - Cited by 0 - S C Sharma - Full Document

Winsome Yarns Ltd. vs Punjab Wireless Systems Limited (In ... on 6 October, 2005

This principle was followed in Ratnaswami Pillai v. Sadapathy Filial and S. Soundararqjah, Roshan and Co. In A. Subbaraya Mudaliar v. K. Sundararajan, it was pointed out that the condition of confirmation by the court being a safeguard against the property being sold at an inadequate price, it will be not only proper but necessary that the court in exercising the discretion which it undoubtedly has of accepting or refusing the highest bid at the auction held in pursuance of its orders, should see that the price fetched at the auction is cm adequate price even though there is no suggestion of irregularity or fraud. It is well to bear in mind the other principle which is equally well-settled namely that once the Court comes to the conclusion that the price offered is adequate, no subsequent higher offer can constitute a valid ground for refusing confirmation of the sale or offer already received (Emphasis supplied).
Punjab-Haryana High Court Cites 20 - Cited by 1 - V Singh - Full Document

Navalkha & Sons vs Ramanujulu Naidu And Ors. on 24 September, 1965

In A. Subbaraya Mudaliar v. K. Sundaramjan, which followed the decisions in Ratnasami Pillai v. Sabapathy Pillai and S. Soundararajan v. Khaka Mahomed Ismail, it was clearly laid down that the condition of confirmation by the court being a safeguard against the property being sold at an inadequate price, it will be not only proper but necessary that the court, in exercising the discretion which it undoubtedly has of accepting or refusing the highest bid at the auction held in pursuance of its orders, should see that the price fetched at the auction is an adequate price, even though there is no suggestion of irregularity or fraud.
Andhra HC (Pre-Telangana) Cites 12 - Cited by 1 - P S Raju - Full Document

Haryana And Steel Centre vs Lakshmi Parcelains Ltd. on 22 July, 2003

42, In A. Subbaraya Mudaliar v. K. Sundararajan , it was pointed out that the condition of confirmation by the Court being a safeguard against the property being sold at an inadequate price, it will be not only proper but necessary that the Court in exercising the discretion which it undoubtedly has of accepting or refusing the highest bid at the auction held in pursuance of its orders, should see that the price fetched at the auction is an adequate price even though there is no suggestion of irregularity or fraud. It is well to bear in mind the other principle which is equally well-settled namely that once the Court comes to the conclusion that the price offered is adequate, no subsequent higher offer can constitute a valid ground for refusing confirmation of the sale or offer already received.
Andhra HC (Pre-Telangana) Cites 13 - Cited by 0 - B S Reddy - Full Document

Bakeman'S Industries P. Limited vs New Cawnpore Floor Mills And Ors. on 2 July, 2007

This principle was followed in Rathnaswami Pillai v. Sadapathi Pillai and S. Soundarajan v. Roshan and Co. In A. Subbaraya Mudaliar v. K. Sundarajan it was pointed out that the condition of confirmation by the Court being a safeguard against the property being sold at an inadequate price, it will be not only proper but necessary that the Court in exercising the discretion which it undoubtedly has of accepting or refusing the highest bid at the auction held in pursuance of its orders, should see that the price fetched at the auction is an adequate price even though there is no suggestion of irregularity or fraud.
Delhi High Court Cites 25 - Cited by 2 - M Mudgal - Full Document

Amba Tannin And Pharmaceuticals Ltd. vs Official Liquidator, High Court, ... on 22 February, 1974

53. The next decision relied upon by Mr. Sorabjee is in the case of Subbaraya Mudaliar v. Sundararajan. The Division Bench in this case has taken the view that merely by reason of the fact that a person was the highest bidder at the auction sale conducted by the receiver under orders of court, the person does not obtain any enforceable right to the property sold at the auction. The condition as regards confirmation of the court is a safeguard against property being sold at an inadequate price. It will, therefore, be not only proper but necessary that the court in exercising the discretion which it undoubtedly has of accepting or refusing to accept the highest bid at the auction in pursuance of it orders, should see that the price fetched at the auction is an adequate price, even though there is no suggestion of irregularity of fraud. A sale conducted by an officer of court would become a farce if the court is obliged to accept the highest bid at such a sale, though the court is convinced that the bid does not represent adequately the real price of the property. This was a question of sale of a property by the court receiver during the pendency of a suit. Directions were given by the trial court to obtain offers for purchase of the printing press as a going concern so that the court might be in a position to decide whether the press should be sold at a public sale or at a sale confined to the parties. As no satisfactory offers were obtained the trail court decided that the press should be sold as a going concern by the joint receiver at a public sale. The parties to the suit were given liberty to bid at the sale on the same terms as other bidders. The sale was to be effected after wide publicity. After giving such publicity the joint receiver conducted the sale on March 25, 1951. There were 12 bidders. In the course of the bidding the 1st defendant gave some bid. The plaintiff who was present did not give any bid. One Subbaraya was the highest bidder, his bid being for Rs. 31,200. The joint receiver knocked down the sale in his favour and received Rs. 8,100, being the 25% of the bid in cash. It was one of the conditions of sale that it will subject to the confirmation of the court. When the joint receiver submitted a report to the court for confirmation of the sale in favour of the highest bidder the plaintiff complained that the highest bid offered at the auction was inadequate and she herself offered Rs. 35,000. The purchaser protested against any attempt to reopen the bidding. The court, however, taking into account the offer of the plaintiff to purchase the press for Rs. 35,000 adjourned the matter to a date on which the learned judge conducted, as it were, an auction between the parties to find out the highest price which would be offered for the property. Eventually, the plaintiff made the highest offer of Rs. 42,000. It was contended before the learned judge on behalf of the auction-purchaser that as there was no irregularity in the conduct of the sale, the court should not set aside the entire auction proceedings being conducted by the joint receiver under orders of the court, and the highest bid which he made should be accepted by the court and the sale concluded in his favour. This contention of the auction-purchaser was not accepted. He took the view that the price fetched at the auction sale was not adequate. He did not accept the contention that the court could not refuse to confine the sale to the highest bidder merely on the ground of apparent in inadequacy of price. The learned judge saw no justification for refusing to accept the offer of the plaintiff for Rs. 42,000. The plaintiff was directed to deposit the sum of Rs. 10,000 before a particular date and the balance within 15 days thereafter. Other appropriate directions were also given. It is against this order that the auction-purchaser preferred the appeal before the Division Bench. It was conceded by the counsel on behalf of the auction-purchaser that merely by reason of the fact that the appellant was the highest bidder at the auction sale conducted by the joint receiver under orders of court, the appellant did not obtain any enforceable right to the property sold at the auction. The appeal of the auction-purchaser was dismissed by the Division Bench observing that a sale conducted by an officer of court would equally become a farce if the court is obliged to accept the highest bid at such a sale, though the court is convinced that the bid does not represent adequately the real price of the property.
Bombay High Court Cites 37 - Cited by 5 - Full Document

Rally Brothers And Convey vs Swadeshi Mills Co. Ltd. [Alongwith ... on 5 September, 2005

In A. Subbaraya Mudaliar v. K. Sundararajan , observation wherein has been approved by the Apex Court in Navalkha & Sons v. Ramanya Das , it is held that the condition of confirmation of sale by the Court is a safeguard against the property being sold at an inadequate price; it will be not only proper "but necessary" that the Court in exercising the discretion which it undoubtedly has of accepting or refusing the highest bid at the auction held in pursuance of its orders, should see that the price fetched at the auction is an adequate price "even though there is no suggestion of irregularity or fraud".
Bombay High Court Cites 14 - Cited by 0 - A M Khanwilkar - Full Document

R.P. David vs M. Thiagarajan And Ors. on 18 January, 1963

(11) The principle laid down by these decisions is that normally the sale held by a court must be confirmed in favour of the highest bidder at the auction and that it would not be permissible to extend the auction to the court room, though it would always be open to the court to refuse confirmation of the sale on the ground that the property was not sold for a proper value. I do not see any reason why the principle of those decisions should not apply even in respect of a sale which is not strictly a court sale but is a sale by a person holding a fiduciary position which cannot be valid without the imprimatur of the court. In the light of this principle the court below acted erroneously and without jurisdiction in receiving the offer of the respondent and in granting the permission to the managers to accept that offer. The application purporting to be one under S. 151 C.P.C. by the respondent was not maintainable and the court had no jurisdiction to consider and grant the relief prayed for by the respondent.
Madras High Court Cites 15 - Cited by 0 - Full Document
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