1. By this order I propose to dispose of the Application preferred by the Auction Purchaser as well as the Official Liquidator’s Report dated 24th March, 2009 together.

2. Briefly stated, pursuant to the direction issued by the Company Judge, the movable and immovable assets of the Company in liquidation were put up for auction. On the basis of inventory and valuation report submitted by Yardi Prabhu Consultants Pvt.Ltd. dated 1st March, 2008, reserved price of the assets put for sale was fixed at Rs.15 crores. The valuer had given break-up of fair market value of the movable assets as Rs.24,85,000/-. He assessed realizable sale value of the movable assets at Rs.22,36,000/- and distress sale value thereof as Rs.19,88,000/-. Insofar as the immovable property is concerned, the valuer assessed fair market value thereof at around Rs.14,69,00,000/-. The movable assets included plant, machinery, furniture and fixtures, whereas immovable assets consisted of land and building lying and situated at Plot No.B-1, M.I.D.C. Ambad, Mumbai-Agra Road, Nasik, admeasuring 27880 sq.mtrs. However, the Company Judge ordered sale of movable and immovable properties of the Company in liquidation as one lot and fixed the Reserved Price thereof at Rs.15 Crores and EMD amount at 25% being Rs.3,75,00,000/-.

3. Before we proceed further, it would be apposite to advert to the description of the condition of the movable assets on the date of inspection and valuation made by the valuers in their report before the auction. It is stated that “all the machineries are out of order and in static condition as on the date of the visit”. Against column “whether the Machinery is to be scrapped. Major repairs and replacement value”, it is stated that “all the machineries are in rusted and dusted condition and many are to be scrapped”. It is further mentioned that “it is difficult to ascertain the residual life of the machineries, as no invoices are produced to know the date of purchase and performance warranty given by the suppliers”. It is also mentioned that “the replacement cost of the machines can not be ascertained in the present case, as the details of all machines are not available. Perhaps keeping in mind the description or the condition of machineries, the Company Judge thought it appropriate to put up both the movable and immovable assets for sale as one lot. Accordingly, publication of sale notice was ordered, pursuant to which the Auction Purchaser participated in the bid. The sale notice clearly mentioned that the terms and conditions of the sale of immovable and movable assets alongwith valuer’s inventory can be obtained from the office of the Official Liquidator, High Court, Mumbai on any working day during office hours on payment. The terms and conditions of sale clearly provided that the stated assets were to be sold on “As is Where is and Whatever there is basis”. Amongst other, clause-20 of the terms and conditions of the sale clearly provides that the properties are being sold on “As is Where is and Whatever there is basis” and the purchaser shall not be entitled to raise any objection as to quality, quantity, misdescription, area, boundary or title, as the same are believed to be and shall be taken as correct and if any error or misstatement or omission if discovered in the particulars of the assets, the same shall not annul the sale nor shall be entitled to any compensation from the Official Liquidator. Inspite of such condition, the Auction Purchaser participated in the bid process and gave his composite offer with full knowledge about the condition of the movable assets lying at the site. Valuation given by the Auction Purchaser being the highest offer in the sum of Rs. 17.05 Crores and in excess of the Reserved Price (i.e.Rs.15 Crores), this Court confirmed the sale in favour of the Applicant/Auction Purchaser on October 3, 2008 on usual terms and conditions.

4. Thereafter, the Applicant/Auction Purchaser deposited the amount of Rs.4