JUDGMENT : (PER P.R.BORKAR,J.)

1. This is a petition filed by the Proprietor of M/s Akanksha International, which has purchased the land, building, plant and machinery of M/s Amar Amit Jalna Alloys Private Limited in auction sale conducted by the secured creditor under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as, "the Securitisation Act, 2002"), for direction to the respondent Electricity Distribution Company to consider application for fresh electricity connection to the petitioner and to quash and set aside the letter dated 1.6.2007 issued by the respondent to the petitioner as illegal. By the said letter the respondent has insisted on the petitioner to pay an amount of Rs.3,30,78,926.87 plus interest which were arrears of electricity charges due from erstwhile consumer M/s Amar Amit Jalna Alloys Private Limited.

2. The petitioner stated that the State Bank of India, Jalna Branch had granted financial assistance to M/s Amar Amit Jalna Alloys Private Limited, D-52/5, Additional M.I.D.C., Jalna. Against the said borrowing, M/s Amar Amit Jalna Alloys Private Limited (hereinafter referred to as, "M/s Amar Amit Company") owed an amount of Rs.3,67,94,628/- to the Bank. The Bank executed an Assignment Agreement under Section 5 of the Securitisation Act, 2002 in favour of Asset Reconstruction Company India Limited (hereinafter referred to as, "the ARCIL") on 29.3.2004. The ARCIL is a Reconstruction and Securitisation Company registered with the Reserve Bank of India and is a public financial institution. Under the Assignment Agreement, the ARCIL took up proceedings under the Securitisation Act, 2002. After giving notice under Sections 13(2) and 13(4) of the Securitisation Act, 2002, the ARCIl put on sale the property of the erstwhile owner company and the petitioner purchased it for Rs.75,00,000/-. A sale certificate was issued in her favour on 15.5.2006 transferring to her right, title, interest, ownership and possession of the Plot No. D-52/5 admeasuring 3000 square meters situated at Additional M.I.D.C., Jalna along with the plant, machinery, other accessories, appurtenances as well as infrastructure erected thereon. The sale certificate issued by the ARCIL was later on lodged for registration and was registered at No. 1567-2007 on 30.4.2007.

3. Pursuant to the sale certificate, the petitioner made an application to M.I.D.C. and got the plot purchased and transferred in her name. The petitioner is bona fide purchaser of secured assets and is not transferee nor successor of previous owner. Prior to the purchase of the property by the petitioner, the respondent had disconnected the electricity supply to the erstwhile owner company. On 2.4.2007 the petitioner made application for fresh electricity connection in her name. However, by letter dated 1.6.2007 the respondent informed the petitioner that she would have first to clear the dues of Rs.3,30,78,926.87 outstanding against M/s Amar Amit company. It is this order which is challenged by the petitioner in this petition.

4. It is argued on behalf of the petitioner that the petitioner is a purchaser under the auction sale held under the Securitisation Act, 2002 and not a purchaser under sale inter vivos, or a legal representative or heir of the previous owner. The sale certificate issued to the petitioner has made it clear that the scheduled property was made free from all encumbrances known to the secured creditors. The buyer is not liable for any liability to Central Excise, Sales Tax, M.S.E.B., P.F., M.D.C. incentives, income tax dues and any creditors. In view of this clear indemnity in the sale certificate and in view of the provisions of the Securitisation Act, 2002, the petitioner is not liable to pay any amount to the respondent and the respondent cannot insist on dues owed by M/s Amar Amit Comp

Click Here to Read the rest of this document