Courts should be cautious in interfering with court sales and reauctions, considering the impact on prospective bidders and the prices fetched.

1.Leave granted.

2. In winding-up proceedings of India Electric Works Ltd., the learned Company Judge, Calcutta High Court brought one of its assets, Plot No. 13A, Block 4, Asaf Ali Road, New Delhi to sale. The learned Company Judge rejected the offers made in the tenders and in the open auction it fetched Rs 45 lakhs. Ultimately when the matter was brought to this Court, by our order dated 4-4-1993 we allowed the appeal and directed to sell the plot by open auction between the appellant and Satpal Malik, the second respondent and we fixed the upset price at Rs 45 lakhs. In the second auction the appellant became the highest bidder for Rs 1.10 crores. On appeal by the respondent, the Division Bench, while upholding the auction, directed the learned Company Judge to reconsider the matter and to conduct auction afresh. Against the order dated 26-5-1993 this appeal by special leave has been filed.

3. Shri G. Ramaswamy, learned Senior Counsel for the appellant contended that as per the directions of this Court and the conditions imposed by the learned Company Judge, the appellant had deposited Rs 1.10 crores on the same day and in terms thereof the appellant had already obtained a registered deed of conveyance. Therefore, the Division Bench was not justified in law to reopen the concluded sale validly made. He further contended that if the auctions are unsettled by repeated court orders an reauction is conducted, prospective bidders would not come forward participate in the competitive bid and it creates an impression among th genuine bidders that the court sale will be uncertain and litigious, would n be attractive and would fetch low price. Inherently there would be mue difference between free sale and court sale prices. So the court should slow to interfere with court sale unless it is vitiated by fraud or material irregularity in conducting the sale. That is not the case of the respondent Division Bench is set aside. The observation of the learned Single Judge are also expunged. The offer of the appellant of Rs 45,00,000 shall be the minimal. It is open to the second respondent, Mr Shantilal Malik to a participate in the auction and the learned Single Judge is directed to conduct the auction in the open court between the parties and the highest offer may be accepted as per law and action be taken thereon as per law. The appeal is accordingly allowed but in the circumstances parties are directed to bear their own costs.