Arun Mishra, J.

This writ petition has been filed by the petitioner, a company registered under the Companies Act, seeking the quashment of the proceedings initiated by the M.P. Financial Corporation, Indore, u/s 29 of the State Financial Corporation Act, 1951 for sale of the property to respondent 2, M/s Sai Chemicals Ltd. Bombay on 24-4-1995 and to direct the Corporation to restore the possession of the factory to the petitioner. By way of amendment further relief has been sought to restore the machinery and the property to the factory premises in the State in which it was on 25-4-1995. Subsequently the property has been sold to respondent 3, M/s Kali Sales Corporation.

The petitioner-company avers in the petition that the company had set up an industry at a huge expense of Rs. 25 lacs at Pachmarhi Road, Piparia, for manufacture of hawai chappals, canvass shoes and cycle tyre-tubes in the year 1965. In the year 1971 the company took a loan of Rs. 9,50,000/- from M.P. Financial Corporation and thereafter took the loan of Rs. 6,50,000/- in the year 1978. The factory came into difficulty and became a sick unit and was closed in the year 1989 and it could not repay the loan of the Corporation. An application u/s 31 was moved by the M.P. Financial Corporation. No action was initiated u/s 29. The petitioner further avers that having elected to make an application u/s 31 it was not open to the respondent to initiate proceeding u/s 29 of the Act. The respondent/corporation took over the factory situated at Pachmarhi Road, Piparia, Distt. Hoshangabad. A panchanama was prepared and possession was delivered to Shri Hemant Malviya. After taking possession the offers were invited by the Corporation for sale of the industrial unit on "as is where is basis". The notice was published in Dainik Bhaskar, Bhopal as per Annex. P-4 on 7-10-1994. 10th and 11th October, 1994 were fixed for inspection of the industrial unit and upto 14-10-1994 offers were to be made. It is submitted that the property is worth about one crore rupees and has been set up in about 5.8 acres. Offers were not invited by making publication in all India papers having wide circulation. Kamal Kishore, son of the Managing Director was residing as a care taker of the unit. He was asked to vacate the premises on 24-4-1995 within 24 hours. He did not vacate the premises and was forcibly removed from the premises. Before such removal the company did not receive and letter/offer made by respondent 2. A copy of the letter (P-6) was handed over by the Corporation which is alleged to have been dispatched on 24-3-1995. On this letter address was shown as 114, Chhitranjan Avenue, Calcutta, which was not the proper address. Thus the letter P-6 was not sent on the correct address. Thus no opportunity was afforded to the petitioner to offer the sale amount. Wrong address was written on P-6 and this letter was not received by the petitioner.

The respondent-Corporation in its return contend that the petitioner committed gross default in due repayment of loan and interest and in the result till 12-9-1994 a sum of Rs. 50.57 lakhs became due. u/s 29 the Corporation has special powers to recover the loan and section 31 authorises it to apply to the District Judge for attachment and sale of property. It is stated that respondent No. 1 has been held to be entitled to abandon the action taken u/s 31 of the Act at any stage and to commence fresh action u/s 29 of the Act. Notices were published in Dainik Bhaskar and Nava Bharat on 6-10-1994. One M/s Agarwal Associates submitted its tender on 14-10-1994. The tender was offered for Rs. 12.60 lakhs. The committee rejected the tender of M/s Agarwal Associates. Fresh notice inviting tender was published in Financial Express on 14-1-1995 (Annex.R-1/15), Economic Times dated 21-1-1995 (Annex. R-1/16); Punjab Kesri dated 16-1-1995, (Annex. R-1/17); M.P. Chronicals dated 17-1-1995 (Annex. R-1/18) and Dainik Bhaskar dated 18-1-1995, (Annex. R-1/19). The fir