Case Note & Summary
The petitioners, Akhilesh Spintex Pvt. Ltd. and its director, filed a writ petition challenging the sale of assets of respondent No.7 by respondent No.3, a Reconstruction Company under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. The sale was conducted through a bidding process with a minimum expected offer of Rs.14 crores. Eleven bidders submitted offers, and the petitioner's offer was Rs.15,01,00,000. Three highest bidders, including respondent No.5 (Jai Corp. Ltd.), were called for negotiations. Respondent No.5 gave the highest revised offer of Rs.19,25,00,000 and was declared the successful bidder. The petitioners contended that the decision to accept respondent No.5's bid was arbitrary and illegal. The Court, after hearing the parties, found that the process was fair and transparent, and the highest bidder was rightly selected. The petition was dismissed with no order as to costs.
Headnote
A) Securitisation Law - Sale of Assets - Fairness in Bidding Process - Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, Sections 13, 15 - The petitioners challenged the acceptance of the highest bid by respondent No.5, alleging irregularities in the bidding process. The Court examined the procedure followed by the Reconstruction Company and found that the process was transparent and the highest bidder was rightly selected. Held that the decision to accept the bid was not arbitrary and the petition was dismissed. (Paras 1-4)
Issue of Consideration
Whether the sale of assets of respondent No.7 by respondent No.3 under the Securitisation Act was conducted fairly and whether the decision to accept the bid of respondent No.5 was arbitrary or illegal.
Final Decision
The petition is dismissed. No order as to costs.
Law Points
- Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act
- 2002
- Section 13
- Section 15
- Sale of assets
- Highest bidder
- Fairness in bidding process
