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Saturday, November 30, 2013

Company petition = Since company not paid entire sale consideration after allotment of plot by the A.P.I.I.C.Ltd., - and after cancellation of plot and forfeit of amount, the official liquidator of the company can not lay any rights over the plot which was cancelled by the A.P.I.I.C.Ltd., as ownership was not transferred = The A.P.I.I. Corpn. Ltd. .....Appellant. Versus M/s. Team-Asia Lakhi Semiconductors Ltd. (in liquidation) rep. by the Official Liquidator, Hyderabad & Anr. …..Respondents = published in http://judis.nic.in/supremecourt/imgst.aspx?filename=41026

Company petition = Since company not paid entire sale consideration after allotment of plot by the A.P.I.I.C.Ltd., - and after cancellation of plot and forfeit of amount, the official liquidator  of the company can not lay any rights over the plot which was cancelled by the A.P.I.I.C.Ltd., as ownership was not transferred =
 this appeal has been filed by the Andhra Pradesh
      Industrial Infrastructure Corporation Ltd.
The appellant is a Government Corporation which allots plots  of  land
for the purpose of setting up industries to different  persons.   The  plots
are allotted on certain conditions and if the conditions are  not  fulfilled
or if the entire payment  is  not  made  within  the  time  stipulated,  the
allotment is cancelled and possession of the  plot  is  taken  back  by  the
appellant.
allotted a plot to M/s. Team-Asia Lakhi Semiconductors Ltd.   on  conditions
incorporated in the said letter.
After the Company had failed to make payment  and  the  allotment  was
cancelled,=
the ownership right in respect of  the  plot
in question has not been transferred to the  Company.  
 It  is  an  admitted
fact that the Company, which is now in liquidation, had not paid the  entire
amount of the consideration and 
therefore, the ownership  right  in  respect
of the plot had not been transferred  to  the  Company.   
According  to  the
terms and conditions on which the plot was to be sold to  the  Company,  the
amount which had been paid by the Company had  already  been  forfeited  and
the Company had no right of whatsoever type in the plot in question.
the  High
Court was in error while coming to the conclusion that the appellant had  no
right in the plot in question and therefore, the impugned judgment  as  well
as the order passed in Company Application are quashed and set aside and  it
is held that the plot  in  question  does  not  belong  to  the  Company  in
liquidation and the official liquidator has no right to deal with  the  said
plot or dispose of the said plot and it would  be  open  to  the  appellant-
Corporation to deal with or allot the said plot as per its own policy.
15.      The  impugned  order  as  well  as  the  order  passed  in  Company
Application are quashed. The appeal is, therefore, allowed with no order  as
to costs.

                                             NON REPORTABLE

                        IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL NO.10753 OF 2013
                  (Arising out of SLP(C) No. 31035 of 2011)



The A.P.I.I. Corpn. Ltd.                     .....Appellant.



                                Versus

M/s. Team-Asia Lakhi Semiconductors Ltd.
(in liquidation) rep. by the Official Liquidator,
Hyderabad & Anr.                        …..Respondents


                              1 J U D G M E N T




1 ANIL R. DAVE, J.


   1. Leave granted.
   2. Being aggrieved by the Judgment dated 14th March, 2011  delivered  by
      the High Court of  Judicature  of  Andhra  Pradesh  at  Hyderabad  in
      O.S.A.No.18 of 2008, this appeal has been filed by the Andhra Pradesh
      Industrial Infrastructure Corporation Ltd.
   3. The circumstances in which the aforestated appeal has been filed  are
      as under:
      The appellant is a Government Corporation which allots plots  of  land
for the purpose of setting up industries to different  persons.   The  plots
are allotted on certain conditions and if the conditions are  not  fulfilled
or if the entire payment  is  not  made  within  the  time  stipulated,  the
allotment is cancelled and possession of the  plot  is  taken  back  by  the
appellant.
      In pursuance of the aforestated activity of the appellant-Corporation,
under a letter  dated  31st  August,  1988,  the  appellant-Corporation  had
allotted a plot to M/s. Team-Asia Lakhi Semiconductors Ltd.   on  conditions
incorporated in the said letter.  The allotment was made in pursuance of  an
application dated 20th August, 1988 submitted by the  M/s.  Team-Asia  Lakhi
Semiconductors Ltd. and the plot was  valued  at  Rs.1,22,67,500/-  and  the
said amount had been calculated at the rate of Rs.250/- per sq. meter.   The
said amount had to be paid to the appellant-Corporation  within  sixty  days
from the date of the receipt of the allotment  order.   It  is  an  admitted
fact that within the period prescribed, the entire price  of  the  plot  had
not been paid by the said allottee to the appellant-Corporation and  in  the
circumstances, as per clause 8 incorporated in the said letter, which  reads
as under, the amount paid by the afore-named company had been forfeited.
       “8.  If payment as stipulated in condition (3)  above  is  not  made
       within 60 days of receipt of this allotment letter,  this  allotment
       letter  shall  stand  cancelled  and  the  EMD  paid  shall   remain
       forfeited.”
4.    After the Company had failed to make payment  and  the  allotment  was
cancelled, a request was made by the Company to grant another plot  at  some
reduced price and in pursuance  of  the  said  request,  the  appellant  had
addressed another letter dated 13th March,  2000  to  the  Company  offering
another plot.  The Company again failed to comply with  the  conditions  and
therefore, the proposal with regard to  allotment  under  the  letter  dated
13th March, 2000 also failed.  Once again another plot was  offered  to  the
Company  by  the  appellant  under  letter  dated  3rd   April,   2001   for
Rs.80,00,000/- but the said  transaction  also  did  not  materialize.   The
aforesaid facts demonstrate the chequered history and the  circumstances  in
which the Company could not make entire payment of  the  plot  in  question,
which ultimately resulted into  forfeiture  of  the  amount  paid  and  even
possession of the plot in question was  with  the  appellant  though  for  a
limited purpose, the Company was permitted to occupy the plot.
5.    It is pertinent to note that the Company, because  of  its  very  poor
financial  conditions,  was  ordered  to  be  wound  up  and  the   official
liquidator, appointed by the Company Court wanted to take possession of  the
plot in question so that the said plot may be  sold  and  out  of  the  sale
price, dues of the Company may  be  paid.   When  the  appellant-Corporation
came to know that the official liquidator was making an  effort  to  dispose
of the plot in question, believing the plot to be one of the assets  of  the
Company in Liquidation, a Company Application  No.474/2006  in  the  Company
Petition  No.178/2003  was  filed  by  the  appellant  praying  for   taking
possession of  the  plot  in  question  as  the  plot  was  in  unauthorized
possession  of  the  Company.   In  the  said  proceedings,   the   official
liquidator admitted the  fact  that  the  plot  in  question  had  not  been
transferred in the name of the Company.  Ultimately, by an order dated  28th
June,  2007  the  Company  application  filed  by  the  appellant  had  been
dismissed by the High Court with a direction to the official  liquidator  to
take appropriate steps to dispose of the plot in question.
6.    Being aggrieved  by  the  aforestated  order  passed  in  the  Company
application, the  appellant  had  filed  an  appeal  being  O.S.A.No.20/2008
before the High Court contending that the plot  in  question  had  not  been
transferred to the Company and therefore, the  official  liquidator  had  no
right or title in respect of the plot in question and  therefore,  he  could
not have taken any action for selling the same.
7.    The said appeal filed by the appellant has also been dismissed by  the
High Court of A.P. and therefore, the present appeal has been filed  by  the
appellant-Corporation.
8.    The learned counsel for the appellant had submitted before this  Court
that the ownership right in the plot in question had  not  been  transferred
to the Company and therefore, the official liquidator had no right  to  deal
with the said plot.  The learned counsel had further submitted that  it  was
an admitted fact that the entire amount of the sale price had not been  paid
to the appellant by the  Company  and  therefore,  the  plot  had  not  been
transferred to the Company.
9.    For the aforestated reasons, the learned counsel  had  submitted  that
the impugned order passed by the High Court requires to be quashed  so  that
the appellant-Corporation can deal itself with the plot  in  the  manner  in
which it likes, especially when the  amount  which  had  been  paid  by  the
Company had already been forfeited because the  Company  had  not  fulfilled
the conditions on which the plot had been allotted.
10.   On the other hand, the learned  counsel  appearing  for  the  official
liquidator of the Company had submitted that as an order of winding  up  had
already been passed and as the Company had paid substantial  amount  towards
purchase price of the plot in question, the official liquidator was  rightly
permitted to dispose of the plot as  the  plot  virtually  belonged  to  the
Company.
11.   The learned counsel had tried to substantiate  the  reasons  given  by
the learned Single Judge as well as by the  Division  Bench  while  deciding
O.S.A.No.18 of 2008 in favour of the official liquidator and  had  submitted
that the appeal should be dismissed.
12.   We had heard the learned counsel and had  also  perused  the  relevant
record which clearly shows that
the ownership right in respect of  the  plot
in question has not been transferred to the  Company.
 It  is  an  admitted
fact that the Company, which is now in liquidation, had not paid the  entire
amount of the consideration and
therefore, the ownership  right  in  respect
of the plot had not been transferred  to  the  Company.  
According  to  the
terms and conditions on which the plot was to be sold to  the  Company,  the
amount which had been paid by the Company had  already  been  forfeited  and
the Company had no right of whatsoever type in the plot in question.
13.   In the aforestated circumstances, in our opinion,
the High  Court  was
not justified in giving any right in respect of the plot in question to  the
official liquidator or the Company.   
It  is  pertinent  to  note  that  the
ownership of the plot in question had not been transferred  to  the  Company
and a permissive possession given by the appellant to the Company  for  some
limited purpose would not create any interest or  right  in  favour  of  the
Company. 
 The plot would remain the property  of  the  appellant-Corporation
as the conditions on which the transfer was  to  take  place  had  not  been
fulfilled.
14.   In the aforestated circumstances, we are of the  view  that
the  High
Court was in error while coming to the conclusion that the appellant had  no
right in the plot in question and therefore, the impugned judgment  as  well
as the order passed in Company Application are quashed and set aside and  it
is held that the plot  in  question  does  not  belong  to  the  Company  in
liquidation and the official liquidator has no right to deal with  the  said
plot or dispose of the said plot and it would  be  open  to  the  appellant-
Corporation to deal with or allot the said plot as per its own policy.
15.      The  impugned  order  as  well  as  the  order  passed  in  Company
Application are quashed. The appeal is, therefore, allowed with no order  as
to costs.

                             ……...........................................J.
                                                       (ANIL R. DAVE)


                             ……...........................................J.
                                                          (DIPAK MISRA)
New Delhi
November 29, 2013

ITEM NO.1A             COURT NO.12             SECTION XIIA
(For Judgment)


            S U P R E M E   C O U R T   O F   I N D I A
                         RECORD OF PROCEEDINGS

C.A.NO.10753/2013 arising out of S.L.P.(C)No(s).31035/2011

(From the judgement and order dated 14/03/2011 in OSA No.18/2008 of The
HIGH COURT OF A.P. AT HYDERABAD)


A.P.I.I.C.LTD                               Petitioner(s)

                 VERSUS

M/S TEAM-ASIA LAKHI SEMICONDUCTORS L.&AN    Respondent(s)

Date: 29/11/2013  This Appeal was called on for pronouncement of Judgment
today.

For Petitioner(s)      Mr. Y. Raja Gopala Rao,Adv.


For Respondent(s)      M/s. Lawyer's Knit & Co,Advs.
                    Mrs. D. Bharathi Reddy,Adv.

     UPON hearing counsel the Court made the following
                      O R D E R

                 Hon'ble Mr.  Justice  Anil  R.  Dave  pronounced  the  Non-
          reportable judgment of the Bench comprising  Hon'ble  Mr.  Justice
          Dipak Misra and His Lordship.
                 The appeal is allowed with no order as to costs in terms of
          the signed reportable judgment.


             |(Sarita Purohit)                        | |(Sneh Bala Mehra)       |
|Court Master                            | |Court Master            |

           (Signed Non-reportable judgment is placed on the file)
                           -----------------------
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