R. BANUMATHI, J

1. O.S.A.Nos.63 and 64 of 2011 arise out of the order of learned single Judge dated 19.1.2011 in C.A.No.1038 of 2006 in C.P.No.229 of 2004, whereby the learned single Judge directed sale of assets of both immovable, land and building and plant and machinery and other movable assets of Arunachalam Sugar Mills Limited (hereinafter referred to as "ASM") by fixing the upset price at Rs.86.44 Crores. ASM's sister concern - New Horizon Sugar Mills Limited (hereinafter referred to as "NHSM") is the appellant in O.S.A.No.63 of 2011. The promoters/directors and their wives are the appellants in O.S.A.No.64 of 2011. Being aggrieved by the dismissal of the applications - O.A.Nos.253 and 254 of 2005 filed under Section 9 of Arbitration and Conciliation Act and directing Bharat Heavy Electricals Limited (in short, "BHEL") to lodge its claim with the Official Liquidator, BHEL has preferred the appeals - O.S.A.Nos.58 and 59 of 2011. O.S.A.No.81 of 2011 is filed by Walchandnagar Industries Limited, one of the unsecured creditor against the order dated 19.01.2011 made in C.A.No.2486 of 2006 in C.P.No.229 of 2004.

2. FACTUAL BACKGROUND OF THE MATTER:-

Indian Renewable Energy Development Agency Limited (in short, "IREDA") granted financial assistance to the tune of Rs.49,35,28,000/- to ASM under loan agreements dated 10.9.1998, 21.7.1999, 29.10.1999 and 3.12.1999; (i) for setting up a 14 MW Bagasse based Co-generation Captive Power Plant; (ii) for enhancing the capacity of Co-generation Captive Power Plant from 14 MW to 19MW; and (iii) for financing expenditure in setting up energy efficient conservation equipment. IREDA has got a first charge over the assets of ASM. IREDA has also granted financial assistance to the NHSM to the tune of Rs.15,54,10,000/- for the purchase of energy efficient equipment to be leased and installed in ASM in juice extraction and juice concentration unit of ASM under loan agreements dated 29.10.1999 and 6.12.1999 and IREDA gets a first charge over the energy efficient equipment financed to NHSM and a second charge over all the assets of NHSM. Within few months of the commencement of production, ASM started losing altitude and both ASM and NHSM committed default in respect of the credit facilities availed by them from IREDA and other creditors.

3. O.A.Nos.112, 113 and 114 of 2004:- IREDA has filed applications - O.A.Nos.113 and 114 of 2004 for recovery of Rs.62.83 Crores and Rs.9.17 Crores respectively from ASM. IREDA has also filed O.A.No.112 of 2004 before Debt Recovery Tribunal-I, New Delhi for recovery of Rs.20.03 Crores from NHSM. IREDA issued notice under Section 13(2) of SARFAESI Act to both ASM and NHSM to discharge in full the above liability. When notice under Section 13(2) was issued to both Sugar Mills, the provisional liquidator of ASM had not then been appointed.

4. C.P.No.229 of 2004:- On 12.7.2004, one of the creditors of ASM - M/s.Alstom Project India Limited filed C.P.No.229 of 2004 for winding up of ASM. In C.A.No.1393 of 2004 filed in C.P.No.229 of 2004, by an order dated 22.7.2005, D.Murugesan,J. appointed Official Liquidator as provisional liquidator to take charge of the properties and effects of the Company.

5. Claims of other creditors, who sold/leased machinery to Arunachalam Sugar Mills Limited:- Sundaram Finance Limited filed application in A.No.4401 of 2004 under Section 9 of the Arbitration and Conciliation Act seeking appointment of an Advocate Commissioner to seize and deliver the machinery available in the premises of ASM. By orders dated 8.12.2004 and 19.3.2005, the Commissioner was appointed to seize and sell the machineries. Thereafter, Sundaram Finance Limited, who let out the machineries to ASM, entered into a Memorandum of understanding on 27.9.2005 with IREDA in and by which it was agreed that IREDA would sell all the properties on or before 31.3.2006 and pay the amount due to Sundaram Finance Limited. It was also agreed that if IREDA was not able to sell th