Retreat Pvt. Ltd. & Another Vs. Edc Ltd. & Ors  Insc 534 (24 August 2006)
Singh & Altamas Kabir
O R D
this special leave petition the Petitioner has impugned the judgment and order
of the High Court of Bombay at Goa dated February 22, 2006 in Civil Writ
Petition No.19 of 2006, whereby it dismissed the Writ Petition filed by the
Petitioner praying that its proposal contained in letter dated January 18, 2006
be considered and that Respondent No.1, herein, be restrained from selling the
assets in question to Respondent No.3.
have heard counsel for the parties at length. We have carefully perused the
material placed before us. We are satisfied that this is not a fit case for
interference by this Court in exercise of its discretionary jurisdiction under
Article 136 of the Constitution of India.
not disputed that the Petitioner had committed defaults in payment of dues to
Respondent No.1. Action was taken under Section 29 of the State Financial
Corporation Act by the aforesaid respondent. The property in question was
attached and possession was also taken by Respondent No.1. The property known
as Falcon Retreat is a hotel.
Respondent No.1 made efforts to put the property to sale by auction. Seven such
attempts were made, but either on account of non-availability of purchaser or
on account of postponement of the auction on the request of the Petitioner, the
property could not be sold.
On November 23, 2005, Respondent No.3, namely, L.K.
Trust made an offer of Rs.12.99 crores for the property in question.
offer of Respondent No.3 was considered by the Board of Respondent No.1 on December 5, 2005 and the Board resolved to accept
the offer on certain conditions. However, the Petitioner was informed of the
private offer by Respondent No.3 and was called upon to get a better offer, if
possible, within three days. The letter of Respondent No.1 dated December 5, 2005 to this effect was perhaps received
by the Petitioner late on December 13, 2005.
In its reply the Petitioner sought twelve months time to arrange a better
On December 12, 2005 the offer of Respondent No.3 was
accepted by Respondent No.1 and the same was communicated to Respondent No.3
incorporating the relevant conditions for the sale.
On December 29, 2005, Respondent No.1 informed the
Petitioner that it was decided to accept the offer of Respondent No.3 to which
the Petitioner objected by saying that the price was ridiculously low.
On January 23, 2006, the Petitioner filed a writ
petition before the High Court praying for a Writ of Mandamus directing
Respondent No.1 to consider the proposal contained in the letter of the
Petitioner dated January
18, 2006 and to
restrain the Respondent No.1 from selling the property to Respondent No.3.
appears from the letter of February 6, 2006
addressed to Managing Director of Respondent No.1 that the offer referred to in
the letter of the Petitioner dated January 18, 2006 related to M/s Condor Polymeric. By
its letter of February
6, 2006, Condor
Polymeric made a formal offer to the Managing Director of Respondent No.1. This
is an event subsequent to the filing of the Writ Petition.
High Court by its impugned judgment and order dismissed the writ petition
holding that Respondent No.1 had already entered into an agreement with
Respondent No.3 for the sale of the assets for a sum of Rs.12.99 crores and,
therefore, there was no question of the same being cancelled or set aside since
it represented a concluded contract between the parties.
observe that M/s Condor Polymeric is not a party before us nor was it a party
in the Writ Petition. In an affidavit filed before this Court affirmed on April
24, 2006, the deponent Arvind S. Ghatkar, General Manager of the Engineering
Department of Respondent No.1 has stated that the offer of M/s. Condor
Polymeric has been considered by the Board of Respondent No.1, and subject to
the decision of this Court, Respondent No.1 may be inclined to accept the
higher offer of Rs. 14 crores, but the Respondent No.1 would not like to go for
re- auction of the property. In its counter-affidavit filed before this Court
on April, 12, 2006, Respondent No.1 has referred to several such proposals made
by the Petitioner in the past, solely with a view to frustrate the efforts of
Respondent No.1 to sell the property and realize its dues.
heard counsel for the parties and considered every aspect of the matter, we are
of the view that at the instance of the Petitioner, this Court should not
interfere in the exercise of its discretion under Article 136 of the
Constitution of India. An offer has been made by Respondent No.3 and accepted
by Respondent No.1. It was stated that though cheques have been issued by
Respondent No.3 they have not been honoured by the bank. Even if that be so, it
is for Respondent No.1 to consider what action it should take in such event. If
ultimately Respondent No.1 finds that Respondent No.3 is not in a position to
fulfill its commitment and pay the price offered within the time granted by
Respondent No.1, it may proceed to consider other options. This is entirely a
matter within the discretion of Respondent No.1. Of course, it is expected to
act fairly and in accordance with law. As long as it acts within the parameters
of the law, and its action is not found to be arbitrary or unreasonable, it is
entitled to take a decision which is in the interest of Respondent No.1 Corporation.
We, therefore, dismiss the special leave petition and leave it to Respondent
No.1 to proceed in accordance with law. If Respondent No.3 makes the payment as
promised within such time as may be granted by Respondent No.1 and fulfills the
conditions of sale, that may be the end of the matter. But if it fails to do
so, it is always open to the Respondent to take necessary steps to safeguard
the interest of Respondent No.1 Corporation which includes inter alia the
consideration of other offers made by other parties.
Special Leave Petition, is therefore, dismissed.
the interim order dated March
27, 2006 stands