National Investor Forum vs The Golden Forests (India) Ltd
2013 Latest Caselaw 5723 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI
                                             Reserved on : 29.8.2013
                                             Decided on : 11.12.2013


+      W.P.(C) No.1399/2010

       NATIONAL INVESTOR FORUM           ..... Petitioner
                   Through : Counsel (appearance not given.)

                              Versus

       THE GOLDEN FORESTS (INDIA) LTD. ..... Respondent

Through : Mr. Harpawan Kumar Arora & Mr. Prashant Chauhan, Advocates for the Committee/GFIL in CM APPL.9657/13

CORAM:

HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE NAJMI WAZIRI

% MR. JUSTICE NAJMI WAZIRI

CM No.9657/2013 (for confirmation of auction sale)

1. This is an application seeking confirmation of auction sale by

the applicant/Committee, GFIL for two properties situated in Ambala.

The applicant submits that advertisements were issued on 13.5.2013

inviting sealed bids for auction of three properties in Haryana: one in

Panchkula district and two in Ambala district. The application seeks

confirmation apropos the latter two i.e. (i) Property No.2: Agricultural

Land measuring Approx.99 Kanal & 3 Marla situated in Village

Dangdehri, Tehsil & District Ambala (Haryana) and (ii) Property No.3:

Agricultural Land measuring Approx. 22 Kanal & 19 Marla situated in

Village Dangdehri, Tehsil & District Ambala (Haryana). The

advertisements were issued in (1) The Chandigarh Tribune, (2) Dainik

Bhaskar (Ambala) and (3) Amar Ujjala (Chandigarh).

2. According to the Committee, these newspapers have wide

circulation in the areas concerned. A reserve price was mentioned

against each of the properties. Bids were received and were processed

for property numbers 2 and 3 only. For the former, two bids were

received: one from M/s. Regent Land Holdings Pvt. Ltd. and the other

from M/s. Vinod Rice Mills Pvt. Ltd. The latter's bid was for

Rs.5,51,00,000/- (Rupees Five crore and Fifty One lakh only). As per

procedure, the lower price bidder was offered to revise his bid but he

declined to do so. Accordingly, the bid of M/s. Vinod Rice Mills Pvt.

Ltd. was accepted. Confirmation of the same is sought in these

proceedings.

3. Apropos property No.3, eleven bids were received, the highest

of which was Rs.1,10,00,100/- (Rupees one crore ten lakh and one

hundred only). Thereafter inter se bidding/open bidding was

conducted between the parties. It ultimately went in favour of Smt.

Indra Jain wife of Sh. Rajender Kumar Jain for Rs.2,25,00,000/-

(Rupees two crore twenty five lakhs only).

4. The Chairman of the Committee, through his affidavit, has

explained the co-relation between the reserve price of the properties

which were advertised, successive scaling down of the reserve price

and the corresponding bids which were accepted. He explains that the

property Nos.2 and 3 were first advertised on 3rd July, 2011 with

reserve prices of Rs.20 crores and Rs.5 crores, respectively. However,

since no bids were received for either of them, the Committee re-

considered the reserve prices of both on the basis of the Collector rate

of gairmumkin agricultural land in Dangdehri village, District Ambala

which was Rs.12 lakhs per acre for the year 2012-13. Accordingly,

revised bids with a reserve price of Rs.8 crores and Rs.2 crores

respectively were invited through advertisement dated 24.3.2012.

Again no bids were received. As a result, the reserve prices were

further reduced to Rs.5 crores and Rs.1 crore respectively. The

affidavit further states that initially the Committee had envisaged the

market price to be Rs.1.5 crore per acre. The basis for this expectation

was the sale of lands admeasuring 77 Killas and 9 Killas respectively

through public auction to M/s. Amartex Industries Ltd. for Rs.70.25

crores and Rs.9.25 crores respectively in December 2006 and January,

2007. However, the reason for lack of similar robust response for the

two properties in question is explained as under:

"4. On the Chandigarh-Ambala National Highway No.22 about 10 to 12 Kms short of Ambala Cantt, on the leftside is the plot of land measuring 22 Kanal 19 Marla and to the right side is the plot of land measuring 99 Kanal 3 Marla. Both these plots are in Village Dangdehri, Tehsil & District Ambala (Haryana). The frontage of about two killas of land out of 99 Kanal 13 Marla touches the National Highway. The Chandigarh- Ambala main Railway lines (tracks) run almost parallel to a short distance from the said plot of land (measuring 99 Kanal-3 Marla). The frontage of the plot of land on the left side also touches the National Highway.

5. At short distance further down towards Ambala is village Jharmari. The Company-GFIL owns large areas of agriculture lands and buildings in village Jharmari and others surrounding villages such as Kurli, Jarout and Sangotha. The said villages are in Punjab. The boundaries of the two plots of land in question and

these of village Jharmari are located in close proximity of each other"

5. The Committee argues that for the Property No.3 although

Collector rate is Rs.12 lakhs per acre, the open bid fetched nearly

seven times more than that i.e. Rs.81.81 lakhs per acre.

6. As regards property No.2, the amount fetched by it is nearly four

times the Collector rate i.e. Rs.44.52 lakhs per acre. The manner of the

bidding has already been discussed hereinabove. In this regard, the

Committee points out that:

"11. This agricultural plot of land has a big disadvantage it is sandwiched between the highway and the Railway lines. The main Chandigarh-Ambala Railway track is running at a distance of about 300 meters from the Highway almost parallel to the plot of land. The Committee understands there are some building restrictions upto some specified distance on the lands near the railway track and highway. Another problem seen by the Committee is that some parts of this land, have undivided share holding.

12. An other experience of the Committee while conducting the auction sale is that most of the bidders are property brokers who form cartel. This situation cannot be avoided, though Committee does its best in meeting such situations."

7. This Court has considered the facts of the case and the manner in

which tender was published, sealed bids received, assessed, then put to

open bidding and the highest bidder being selected in this manner. The

returns fetched for the two properties in question are four to seven

times higher than the relevant Collector's rate. The bid rates appear to

be influenced by the peculiar location of the two lands and their

appurtenant circumstances. The Court finds the process to be fair and

the assessment by the applicant to be reasonable. Accordingly, the

Court grants permission for the confirmation of sale of the two

properties. The application is allowed.

NAJMI WAZIRI (JUDGE)

S. RAVINDRA BHAT (JUDGE) DECEMBER 11, 2013 ak