Calcutta High Court
M/S. Dunlop India Limited vs Salasar Towers Pvt. Ltd on 17 March, 2026
IN THE HIGH COURT AT CALCUTTA
ORIGINAL JURISDICTION
ORIGINAL SIDE
BEFORE:
HON'BLE JUSTICE RAJA BASU CHOWDHURY
IA No.CA/61/2019 (Old No. CA/199/2019)
in
CP/233/2008
In the matter of :
M/s. Dunlop India Limited
And
Salasar Towers Pvt. Ltd.
Versus
The Official Liquidator, High Court, Calcutta
with
IA No. CA/83/2021
in
CP/233/2008
In the matter of :
M/s. Dunlop India Limited
And
M/s. E. V. Mathai & Sons.
Versus
The Official Liquidator, High Court, Calcutta
with
IA No. CA/386/2024
in
CP/233/2008
In the matter of :
M/s. Dunlop India Limited
And
Eyelid Mercantiles Pvt. Ltd.
Versus
The Official Liquidator, Hon'ble High Court At Calcutta & Anr.
For the Eyelid Merchantiles Pvt. : Mr. Anirban Ray, Sr. Adv.
Ltd. Mr. Rupak Ghosh, Adv.
Mr. Siddharth Dey, Adv.
Mr. Ashutosh Singh, Adv.
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For the Salasar Towers Pvt. Ltd. : Mr. Ratnanko Banerji, Sr. Adv.
Mr. Soumya Mazumder, Sr. Adv.
Mr. Jishnu Chowdhury, Sr. Adv.
Mr. Ritoban Sarkar, Adv.
Mr. Sounak Mitra, Adv.
Mr. Zulfiquar-ali-al-Quaderi, Adv.
Ms. Akshita Bohra, Adv.
For the Official Liquidator : Mr. Tilak Bose, Sr. Adv.
Mr. Tanushree Dasgupta, Adv.
Heard on : 18.07.2024, 08.08.2024, 22.08.2024,
29.08.2024, 12.11.2024, 17.12.2024,
14.01.2025, 21.01.2025, 27.01.2025,
06.02.2025, 16.07.2025, 03.09.2025,
10.09.2025, 17.09.2025, 21.11.2025,
28.11.2025, 05.12.2025, 12.12.2025
& 17.12.2025.
Judgment on : 17th March, 2026.
RAJA BASU CHOWDHURY, J. :
1. Records reveal that C.P. 233 of 2008 (M/s. Dunlop India Limited v. M/s.
E. V. Mathai & Sons.), along with connected applications which had been
pending for sometime had since been assigned before this Court on 18th
April, 2024. Following the same, the above company petition being C.P.
233 of 2008 along with connected applications being C.A. 61 of 2019,
C.A. 83 of 2021 and C.A. 386 of 2024 have been taken up for
consideration by this Court.
2. C.A. 61 of 2019 is an application filed by Salasar Towers Pvt. Ltd., (in
short, Salasar), inter alia, praying for a direction upon the official
liquidator to sell 50 per cent of the proportionate undivided share in the
land situated in the Kings Court, 46B, Chowringhee Road, Kolkata –
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700071, along with twelve (12) flats being flat nos. 1, 5, 8, 9, 11, 12, 14,
17, 18, 19, 21 and 24, with eleven (11) garages, fourteen (14) servants’
quarters (hereinafter referred to the “said property”), to Salasar at fair
value with a further direction upon the official liquidator to transfer
and/or convey 50 per cent of the said property to the extent owned by
Dunlop India Limited (in liquidation) under a private treaty in favour of
the Salasar pursuant to two several representations dated 15th July,
2019 and 19th August, 2019; as also for a direction upon the official
liquidator to complete the entire process of sale of the said property
within a particular period as noted in the Judges Summons taken out
on 30th September, 2019. In this context, it would also be relevant to
note that originally on 15th May, 1953, by a deed of conveyance, Dunlop
Rubber Company (India) Limited, later renamed as Dunlop India Limited
(now in liquidation), along with Guest Keen Williams Ltd., (in short,
GKW) acquired the premises at 46B, Chowringhee Road, Kolkata from
Nawn Estates Limited (hereinafter referred to as the “said premises”). On
18th July, 1953 an agreement was executed between Dunlop India
Limited (now on Liquidation) and GKW whereby the parties had agreed
to certain terms and conditions of ownership and transferability of
shares, including a pre-emption clause which provided that no third-
party shall be permitted to acquire any share or interest in the said
premises, and if any of the parties were desirous of selling the shares, in
such case, the other party shall have the first option of purchasing the
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shares. In the year 2001, GKW which had by then been renamed as
GKW Ltd., entered into nine (9) separate agreements for sale with
different companies including Salasar Towers Pvt. Ltd., for sale of nine
(9) flats along with nine (9) garage spaces and nine (9) servants quarters
in respect of its 50 per cent share of the said premises. Later on 7th
October, 2002, GKW entered into three (3) separate agreements for sale
with separate companies for sale of three (3) flats two (2) garages and
five (5) servants quarters in respect of its 50 per cent share of the said
premises. Possession of the units agreed to be sold was handed over to
the agreement holders upon payment of full consideration amount.
3. In the interregnum, Dunlop India Limited became sick, within the
meaning of Sick Industrial Companies (Special Provisions) Act, 1985 and
was referred to the Board of Industrial and Financial Reconstruction (in
short “BIFR”). Subsequently, in the liquidation proceedings that
followed, by a letter dated 17th February, 2003, State Bank of India had
approached the Appellate Authority of BIFR (AAIFR) for approving the
reserve price of eight properties of the company in liquidation including
50 per cent share of the said premises owned by Dunlop India. By an
order dated 25th February, 2003, the AAIFR in a proceeding of the
company in liquidation directed that the properties of the company in
liquidation be disposed of expeditiously and the Assets Sale Committee
was authorised to accept bids and complete the sale of properties of the
company in liquidation which included the said premises. Still later on
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15th September, 2003, by an order passed by the Hon’ble Company
Court in a separate company proceedings being C.P. 214 of 2003, the
scheme of amalgamation between Salasar Towers Pvt. Ltd. and the other
agreement holder companies noted that all the rights and liabilities
which had accrued under the respective agreement in favour of the
agreement holder companies stood transferred to Salasar Towers Pvt.
Ltd. The aforesaid order has, however, not been placed for consideration
before this Court. When the aforesaid application being C.A. 61 of 2019
came up for consideration before a Coordinate Bench of this Court on
3rd February, 2021, the Coordinate Bench by an order of even date
noting that Dunlop had huge debts and innumerable creditors, both
secured and unsecured, and also noting that in public interest if the
properties of Dunlop are sold, the same should be sold through public
auction so that the highest possible price can be fetched, for the benefit
of its creditors, directed the official liquidator to set in motion the
process of sale of property in question. It was also made clear by such
order that once, offers are received from the intending purchasers, the
official liquidator and the Court would know the highest price obtainable
from the property and if the Salasar can match the highest price then
Salasar’s claim can be considered favourably in view of the right of pre-
emption that exists in its favour. By such order, the official liquidator
was directed to obtain valuation report of the property in question from
recognized valuer before he can proceed any further.
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4. Records would reveal that the official liquidator after obtaining the
valuation report, had filed the same in Court on 6th September, 2021
and it is only thereafter, the application being C.A. 83 of 2021 was filed
by Eyelid Merchantiles Private Limited (in short, Eyelid) for setting aside
the order passed by this Court directing the official liquidator to proceed
with the sale of property to the extent of half share owned by the Dunlop
India Limited. By an order dated 19th October, 2023, the Coordinate
Bench noting that Eyelid apart from filing the application had done very
little, had held that Eyelid cannot stand in the way of stopping sale of
property. The Eyelid’s right at best would be to participate in the sale of
the property and match the highest bid along with Salasar and
accordingly, the Court held that since the Eyelid was unlikely to be
prejudiced, permitted Eyelid to participate as bidder in the sale of the
property, and directed the official liquidator to expeditiously process the
sale of the assets of the company in liquidation.
5. The aforesaid order was carried in appeal, which was registered as APOT
414 of 2023. By an order dated 2nd November, 2023, the Division Bench
of this Court noting that sufficient protection has been afforded in terms
of Rule 272 of the Company Court Rules, 1969 which recognizes that
the sale cannot be concluded unless it is confirmed by the Court and
also noting that the application being C.A. 83 of 2021 was pending, had
disposed of the said appeal by requesting the learned Company Judge to
take up the hearing of the application being C.A. 83 of 2021 pending at
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the behest of Eyelid before confirming the sale proposed to be held on
the next date.
6. Records would also reveal that another appeal was filed by Kanti
Commercials Private Limited, a contributory of the company in
liquidation, challenging the order dated 19th October, 2023, on the
ground that the said order was passed without affording the appellant a
right to represent.
7. The aforesaid appeal finally came to be disposed of by a judgment and
order dated 19th December, 2023, inter alia, by observing that since
essentially the challenge in the said appeal was in respect of the
valuation made in the year 2000 pursuant to the sale notice, the appeal
Court directed the official liquidator to have a fresh valuation of the
property in question by a reputed and recognized valuer, and thereafter
to publish the sale notice in the mode and manner provided therein. It
was further provided that the matter shall thereafter, be placed before
the Company Court by the official liquidator after process is complete,
for confirmation of sale on the date to be specified in the sale notice.
8. Records would also reveal that Eyelid had since filed a suit before the
learned 5th Bench, City Civil Court at Calcutta, which was registered as
T.S. no. 2382 of 2023 against Salasar, inter alia, for a declaration of
permanent and mandatory injunction, on the strength of an agreement
for sale dated 25th September, 2006 in respect of the Dunlop’s share in
the said premises. Although, an order of status quo was passed as would
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be evident from order dated 1st December, 2023, on an appeal being filed
from such order, which was registered as FMAT 572 of 2023, the said
order was set aside and the matter was remanded back with a direction
to decide the plaintiff’s injunction application expeditiously. Pursuant to
the aforesaid order, the injunction application was taken up for final
consideration on 9th February, 2024 and the same was rejected on the
ground that Eyelid as plaintiff had no better instrument other than the
unregistered agreement for sale which does not confer any right on it,
even by any stretch of imagination, to exercise right in terms of
reasonably constructed agreement dated 18th July, 1953 entered
between Dunlop and GKW.
9. Records would also reveal that an application was filed by Kanti
Commercials Private Limited for setting aside the sale notice dated 8th
January, 2024 which was registered as C.A. 294 of 2024. The said
application was, however, dismissed by an order dated 28th February,
2024 with costs of Rs. 3 lakhs by holding that the Court does not find
any infirmity in the valuation of Rs. 29,44,00,000 put in the impugned
sale notice and that it also sees no reason either to delay or interfere
with the process of sale of the concerned property, namely, Kings Court,
46B, Chowringhee Road, Kolkata and that the applicant had failed to
establish any basis for such interference.
10. Still later C.A. 386 of 2024 has been filed by Eyelid, inter alia,
seeking for a leave to institute a suit and seeks specific performance of
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the agreement for sale executed in its favour by the company in
liquidation in respect of the said property. The Judges Summons has
been taken out on 7th December, 2024.
11. The above applications are all contested. Affidavits have already
been exchanged.
12. Mr. Roy, leaned Senior Advocate appearing for the Eyelid in
support of C.A. 83 of 2021 and C.A. 386 of 2024 would insist that its
claim is based on an unregistered agreement for sale dated 25th
September, 2006 entered into between Dunlop and the applicant, for
sale of the 50 per cent share of the subject property. The applicant has
paid a total consideration of Rs. 8 Crores to the company in liquidation.
In support of this aforesaid contention, amongst other documents,
money receipts, a letter dated 27th December, 2006 issued by Dunlop
India Limited has been placed. The letter dated 25th September, 2006
issued by the company liquidation intimating Talbot and Company that
their portion of the property at Kings Court has been sold in favour of
the Eyelid and with a further request upon the said Talbot and
Company to make future correspondences with Eyelid has also been
relied on. Certain money receipts issued by Talbot and Company and
Electricity Bills have also been disclosed. It has, however, been stated
since, the subject property has now become onerous, the same should
be disclaimed in favour of the Eyelid. Certain judgments have been
relied on at the time of argument by Mr. Roy, while moving the C.A. 83
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of 2021, however, subsequent to the application being C.A. 386 of 2024
being moved, such judgments have not been pressed. To maintain the
records, the said judgments are noted below:
i. In re Siddhpur Mills Co. Ltd. Ex parte Relliance Textile
Industries Ltd., reported in (1987) 61 Comp Cas 756.
ii. Farokh S. Todywalla v. Official Liquidator of Vitta
Mazda Ltd., reported in 2005 SCC OnLine Guj 263.
iii. Dunlop India Limited v. Container Corporation of India
& Anr., by High Court of Judicature at Madras on 19th
December, 2007 in W.P. No. 24422 of 2006.
iv. M/s. K & Co., a Partnership firm rep. by its Constituted
Attorney Shri J. Dhamija v. M/s. Aruna Sugars and
Enterprises Ltd., reported in 1998-2-L.W. 725.
v. In re: J. Sen Gupta (Private) Ltd., (In Liquidation),
reported in 1961 SCC OnLine Cal 143.
vi. Bhoop Alleged Son of Sheo v. Matadin Bhardwaj (Dead)
by LRS., reported in (1991) 2 SCC 128.
vii. NGEF Ltd. v. Chandra Developers (P) Ltd. & Anr.,
reported in (2005) 8 SCC 219.
13. Insofar as C.A. 386 of 2024 is concerned, it is submitted that
though the official liquidator has raised a question of limitation while
filing its affidavit-in-opposition, such stand of the official liquidator is
without considering the terms of the agreement. It is submitted that in
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terms of the agreement, Eyelid had a right to call upon the vendor i.e.
Dunlop to execute such deed of conveyance. As per the terms of the
agreement the company in liquidation was bound to execute the deed of
conveyance on demand. Eyelid was all along ready and willing to act in
terms of the agreement. It is submitted that either this court adjudicates
the rights of Eyelid or in in alternative grants leave to institute suit for
specific performance by allowing C.A. 386 of 2024. The issue of specific
performance raised by Eyelid requires to be adjudicated either before the
Company Court or leave be granted to file a suit before a civil forum,
before this court can proceed further.
14. Mr. Banerji, learned Senior Advocate has appeared on behalf of
Salasar and has taken this Court through the documents on record
including several orders. He claims that the right of Salasar to
participate in the auction and match the price has already been
recognized by the Coordinate Bench of this Court vide order dated 3rd
February, 2021. On the issue of Eyelid’s claim in respect of 50 per cent
of Kings Court, though Eyelid claims that a sum of Rs. 8 Crores was
paid to the company in liquidation under an agreement for sale and
though, certain maintenance charges of the property has been shown to
have been made, the documents relied on by Eyelid to establish the
above includes an unregistered and insufficiently stamped document of
the year 2006. No explanation has been provided as to why specific
performance of this particular agreement had not been sought for
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earlier. On the own showing of Eyelid, it did not make payment of the
consideration and the transactions relied on by Eyelid are between India
Finance Private Limited and Dunlop. Eyelid and India Finance Private
Limited are both group companies of Dunlop, and the transaction
disclosed by Eyelid is proof of the factum of money being siphoned
though a circular transaction between Dunlop, Eyelid and India Finance
Private Limited. To substantiate the same, balance sheet of Dunlop from
2010-11 mentioning Dadar Properties and Finance Private Limited,
Eyelid and India Finance Private Limited as associate/ group companies
of Dunlop, have been relied on. The financial statement of Eyelid
mentions Dadar Properties and Finance Pvt Limited to be holding
company of Eyelid. The View Director Master Data which shows various
group companies of Dunlop in the same frame have also been disclosed
in the affidavit in opposition filed by Salasar in connection with C.A. 83
of 2021, which has also been relied on by Mr. Banerji. This apart Mr.
Banerji has also by placing reliance on the order dated 19th December,
2023 passed by the Division Bench of this Court contended that by the
aforesaid order the Division Bench has cast serious doubts as regards
the claim of Eyelid over in respect of the portion of the property in
question. The Learned City Civil Court had also in T.S. 2382 of 2023
refused to pass any order of injunction so as to restrain Salasar from
exercising any right of pre-emption. He also submits that this Court in
exercise of its jurisdiction under Companies Act should not permit
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execution and registration of the purported deed of conveyance in the
year 2026 on the basis of unregistered and insufficiently stamped
document dated 25th September, 2006. In support of his contention that
an unregistered document does not confer title reliance has been placed
on the following authorities:-
i. Suraj Lamp and Industries Private Limited v. State of
Haryana and Anr., reported in (2012) 1 SCC 656,
ii. Ram Baran Prasad v. Ram Mohit Hazra & Ors., reported in
(1967) 1 SCR 293,
iii. Narandas Karsondas v. S.A. Kamtam & Anr., reported in
(1977) 3 SCC 247,
iv. Kanta Devi Berlia v. Mohit Jhunjhunwalla & Ors., reported
in 2006 SCC OnLine Cal 91,
v. Ramesh Chand v. Suresh Chand & Anr. in Civil Appeal No.
6377 of 2012 (Supreme Court).
15. He has also attempted to distinguish the judgments relied on by
Eyelid. He also submits that this Court should not grant any leave at
this stage to Eyelid to institute a suit for specific performance as the
same is ex facie barred by limitation.
16. Mr. Tilak Bose, learned senior advocate appearing for the official
liquidator, has however, at the very outset placed before this Court the
provisions of Section 535 of the Companies Act to highlight the
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circumstances when such provision can be invoked. To morefully
appreciate the same, the aforesaid Section is extracted hereinbelow:
“DISCLAIMER OF ONEROUS PROPERTY IN CASE OF A COMPANY
WHICH IS BEING WOUND UP.
535. (1) Where any part of the property of a company which is being
wound up consists of –
(a) land of any tenure, burdened with onerous covenants ;
(b) shares or stock in companies ;
(c) any other property which is unsalable or is not readily saleable, by
reason of its binding the possessor thereof either to the performance of
any onerous act or to the payment of any sum of money; or
(d) unprofitable contracts ;
the liquidator of the company, notwithstanding that he has
endeavoured to sell or has taken possession of the property, or
exercised any act of ownership in relation thereto, or done anything in
pursuance of the contract, may, with the leave of the Court and subject
to the provisions of this section, by writing signed by him, at any time
within twelve months after the commencement of the winding up or
such extended period as may be allowed by the Court, disclaim the
property :
Provided that, where any such property has not come to the knowledge
of the liquidator within one month after the commencement of the
winding up, the power of disclaiming the property may be exercised at
any time within twelve months after he has become aware thereof or
such extended period as may be allowed by the Court.
(2) The disclaimer shall operate to determine, as from the date of
disclaimer, the rights, interest, and liabilities of the company, and the
property of the company, in or in respect of the property disclaimed, but
shall not, except so far as is necessary for the purpose of releasing the
company and the property of the company from liability, affect the
rights or liabilities of any other person.
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(3) The Court, before or on granting leave to disclaim, may require such
notices to be given to persons interested, and impose such terms as a
condition of granting leave, and make such other order in the matter as
the Court thinks just.
(4) The liquidator shall not be entitled to disclaim any property in any
case where an application in writing has been made to him by any
person interested in the property requiring him to decide whether he
will or will not disclaim, and the liquidator has not, within a period of
twenty-eight days after the receipt of the application or such extended
period as may be allowed by the Court, given notice to the applicant
that he intends to apply to the Court for leave to disclaim; and in case
the property is a contract, if the liquidator, after such an application as
aforesaid, does not within the said period or extended period disclaim
the contract, he shall be deemed to have adopted it.
(5) The Court may, on the application of any person who is, as against
the liquidator, entitled to the benefit or subject to the burden of a
contract made with the company, make an order rescinding the contract
on such terms as to payment by or to either party of damages for the
non-performance of the contract, or otherwise as the Court thinks just;
and any damages payable under the order to any such person may be
proved by him as a debt in the winding up.
(6) The Court may, on an application by any person who either claims
any interest in any disclaimed property or is under any liability not
discharged by this Act in respect of any disclaimed property, and after
hearing any such persons as it thinks fit, make an order for the vesting
of the property in, or the delivery of the property to, any person entitled
thereto or to whom it may seem just that the property should be
delivered by way of compensation for such liability as aforesaid, or a
trustee for him, and on such terms as the Court thinks just ; and on any
such vesting order being made, the property comprised therein shall
vest accordingly in the person therein named in that behalf without any
conveyance or assignment for the purpose :
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in CP 233 of 2008Provided that, where the property disclaimed is of a leasehold nature,
the Court shall not make a vesting order in favour of any person
claiming under the company, whether as under-lessee or as mortgagee
or holder of a charge by way of demise, except upon the terms of
making that person –
(a) subject to the same liabilities and obligations as those to which the
company was subject under the lease in respect of the property at the
commencement of the winding up; or
(b) if the Court thinks fit, subject only to the same liabilities and
obligations as if the lease had been assigned to that person at that
date;
and in either event (if the case so requires) as if the lease had
comprised only the property comprised in the vesting order; and any
mortgagee or under-lessee declining to accept a vesting order upon
such terms shall be excluded from all interest in and security upon the
property, and, if there is no person claiming under the company who is
willing to accept an order upon such terms, the Court shall have power
to vest the estate and interest of the company in the property in any
person liable, either personally or in a representative character, and
either alone or jointly with the company, to perform the lessee’s
covenants in the lease, freed and discharged from all estates,
encumbrances and interests created therein by the company.
(7) Any person injured by the operation of a disclaimer under this
section shall be deemed to be a creditor of the company to the amount
of the compensation or damages payable in respect of the injury, and
may accordingly prove the amount as a debt in the winding up.”
17. He has next placed before this Court the order dated 8th May,
2017 to highlight that it is pursuant to such order that the official
liquidator was activated to take actual possession of the properties of
the company in liquidation. Following the aforesaid, the official
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liquidator had visited the premises no. 46B, Chowringhee Road, Kolkata
on 4th October, 2018 and had noted that the said property is a five (5)
storied building on a plot of land measuring 3 bighas, with garages and
staff quarters. It is during such visit one, Mr. Manik Chand Dwark and
one, Mr. Alok Banerjee came on the spot and objected to the taking over
possession of the entire premises by demanding that 12 flats together
with garages and servants quarters in the said building along with
undivided share of land was owned by Salasar Towers Pvt. Ltd. whom
they represent. Copy of the registered conveyance dated 31 st March,
2008 together with copies of the municipal tax receipts were also made
over to the official liquidator. In the circumstances as aforesaid, the flat
nos. 1, 5, 8, 9, 11, 12, 13, 14, 17, 18, 19 and 21 have only been taken
into custody with undivided share of land by putting new padlocks and
official seal together. Signature of both official liquidator and the names
of the others present appear on the minutes of the meeting. According to
such report, presence of Eyelid was not noted at the time of taking over
procession by the official liquidator. He has also relied on a letter dated
27th July, 2018 issued by the Kolkata Municipal Corporation in
response to a query from the official liquidator intimating that apart
from the name of Dunlop Rubber Company Limited, M/s. Guest Keen
Williams Ltd., and the name of Salasar Towers Pvt. Ltd. appear in the
records of the Municipality as recorded owners in respect of such
property. He has also relied on a letter for direction taken out by the
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official liquidator for the said application to be taken on record a
monthly report January and February 2020, and for leave to take over
the assets and properties of the company in liquidation at Worli,
Mumbai, Attapattu at Ambattur, Chennai, and Sahaganj at Hooghly,
which was affirmed by the Deputy Official Liquidator on 5th March,
2020. By an order dated 8th January, 2021, a Coordinate Bench of this
Court taking note of the averments made in the affidavit in support of
the application for directions had allowed prayer ‘A’ of the summons for
direction dated 8th December, 2020 by noting that prayer-B of summons
shall be considered in a separate application. By referring to the above
report, he has submitted that the official liquidator upon receipt of
confirmation by the Kolkata Municipal Corporation that the property at
62A, Mirza Ghalib Street, Kolkata – 700016 is owned by the company in
liquidation has taken possession of such property. The report records
that the said property has also been taken possession by the official
liquidator.
18. He has also drawn the attention of this Court tot the unregistered
agreement dated 25th September, 2006 and contends that as per clause
3 of such agreement, execution of conveyance is simultaneously with or
before handing over possession of the said unit to the purchaser. Having
regard thereto, the case made out by Eyelid along with the surrounding
circumstances and the absence of Eyelid at the time of taking
possession does not appear to be acceptable. By referring to the bank
19 IA No.CA/61/2019
with IA No. CA/83/2021
with IA No. CA/386/2024
in CP 233 of 2008
statement, he had tried to highlight that the money which was
transferred from Dunlop to India Finance was further routed from India
Finance to Coral ENVT involving Eyelid. The same would make out a
case of money laundering involving Eyelid.
19. He has also relied on the invoices issued by Shiva Sakti Security
Services, which has been engaged by the official liquidator to secure
portion of premises no. 46B, Chowringhee Road, Kolkata, which has
been taken possession by the official liquidator. According to Mr. Bose,
the provisions of Section 535 of the Companies Act cannot authorise the
official liquidator to execute any deed of conveyance. Further since, an
application under Section 446 of the Companies Act seeking leave is
pending the aforesaid prayers are wholly illusory and have been
rendered infructuous.
20. Having heard the learned advocate appearing for the respective
parties, I notice that though this Court having regard to the judgment
delivered by the Division Bench on 2nd November, 2023 in APOT 414 of
2023 is obliged to decide on the application of Eyelid before confirming
the sale proposed, the matter has, however, travelled further. In fact by
a subsequent order dated 19th December, 2023 passed by the Division
Bench in a connected matter, on an appeal filed by the contributory
from the auction notice issued by the official liquidator, wherein Eyelid
was represented, despite noting the contention of Eyelid, granted leave
both to Eyelid and Salasar to participate in the auction sale and submit
20 IA No.CA/61/2019
with IA No. CA/83/2021
with IA No. CA/386/2024
in CP 233 of 2008
their bids, if so advised, without prejudice to their rights and
contentions with a further direction upon the official liquidator to
publish a sale notice in the website where offers can be submitted upon
obtaining fresh valuation of the property on or before 10th January,
2024.
21. Eyelid has since taken out the application being C.A. 386 of 2024
and has sought for leave to institute a suit for specific performance of an
agreement for sale dated 25th September, 2006. Having thus, proceeded
with such application, the prayer made in C.A. 83 of 2021, which not
only call upon the official liquidator to disclaim the undivided half share
of the property but also seek for a direction upon the official liquidator
to execute registered deed of conveyance in respect of the half share at
46B, Chowringhee Road, Kolkata, in favour of Eyelid, in my view, cannot
survive. This apart, in order to insist for a prayer for disclaimer, Eyelid
has to establish its right at the first instance over in respect of property
in question. Admittedly, when the official liquidator had visited the
property in question, Eyelid was nowhere to be seen. The municipal
records also do not recognise the presence of Eyelid. Though, the
presence of Salasar is noted. Eyelid relies on an unregistered agreement
for sale. It is well settled that an unregistered agreement for sale does
not confer title. The judgment delivered in the case of Kanta Devi
Berlia (supra), Suraj Lamp & Industries (supra), Ram Baran Prasad
(supra), Narandas Karsondas (supra) and Ramesh Chand (supra) are
21 IA No.CA/61/2019
with IA No. CA/83/2021
with IA No. CA/386/2024
in CP 233 of 2008
relied on. This apart, though, Eyelid has claimed the agreement for sale
is backed up with a consideration of Rs. 8 Crores, such payment on the
own showing of Eyelid was not directly paid by Eyelid. The transactions
relied on as has been disclosed in an affidavit in reply affirmed by one
Ritabrata Adak on 16th March, 2022 would demonstrate that payments
have been made from India Finance Limited through a series of
transaction involving Dunlop to India Finance as well. Mr. Banerji has
however, drawn the attention of this court to the bank statements and
the balance sheet of Dunlop and has attempted to highlight that these
transactions are circular transactions, which had been entered with the
object of siphoning away funds from Dunlop. Although, the Eyelid has
relied on a document dated 3rd August, 2006 authorising sale/disposal
of the companies non-core assets at Kings Court, 46B, Chowringhee
Road, Kolkata, however, the authenticity and/or validity of such
document is also not without doubt especially having regard to the
disclosure made by the official liquidator that at the time of taking over
possession of the property of Dunlop, Eyelid was nowhere to be seen.
22. This apart, as has been rightly pointed out by Mr. Banerji, the
balance sheet of Dunlop for 2010-11 mentions Dadar properties and
Finance Limited, Eyelid and India Finance Limited as associate/group
companies of Dunlop India Limited. The same read with Form No. AOC-
4 for filing financial statement of Eyelid under Rule 12(1) of the
Companies (Accounts) Rules, 2014 mentions Dadar Properties and
22 IA No.CA/61/2019
with IA No. CA/83/2021
with IA No. CA/386/2024
in CP 233 of 2008
Finance Private Limited to be the holding company of Eyelid, and the
printout of the View Director Master Data also shows the group
companies of Dunlop in the same frame, which includes Dadar
Properties and Finance Pvt. Ltd., and Eyelid Merchantile Pvt. Ltd.
Interestingly, when the challenge to the winding up order was turned
down in A.P.O. No. 50 of 2013, by order dated 2nd May, 2013, the
Hon’ble Division Bench had noted that when the company was sick and
the matter was pending before the BIFR or so soon thereafter four
valuable properties of the company in liquidation estimated Rs.2300
Crores were surreptitiously transferred. To morefully appreciate the
same, the relevant portion of the above order is extracted hereinbelow:
” BACKDROP:
Dunlop India Ltd. was a Tyre manufacturing Company. It changed
hands from time to time. Ultimately, the company came within the fold
of Chabarias, the liquor baron. The company became sick and was
referred to the Board of Industrial and Financial Reconstruction
(hereinafter referred to as ‘BIFR’). While the proceeding was pending
before the BIFR, Ruias came in control of the company. Ruias claimed,
they got control through purchase of controlling block of shares. Be that
as it may, Ruias came in control of both the factories at Sahaganj in the
State of West Bengal and Ambattur in the State of Tamil Nadu. Intially
Ruias opened the Sahaganj factory and started manufacturing process
at least, it was claimed so. Ambattur unit was however functioning. It
now appears, during the period when matter was pending before the
BIFR or so soon thereafter four valuable properties having an estimated
value of Rs.2300 crores were surreptitiously transferred. The
management wanted to avoid the restrictions of Section 22 of the Sick
Industrial Companies Act, 1985, window dressed the accounts showing
23 IA No.CA/61/2019
with IA No. CA/83/2021
with IA No. CA/386/2024
in CP 233 of 2008the net worth of the company positive and thus came out of the fold of
BIFR. The management neither paid the creditors nor the workers. Both
the units were shut down in course of time. The creditors started
making application for winding up since 2008. There had been earlier
winding up petitions that were kept in abeyance in view of pendency of
the proceeding before the BIFR. For some time the company also
enjoyed the benefit of relief undertaking under the State law. On a sum
total of the situation, the company left no stone unturned keeping the
creditors at bay. The workers were given false promises. In the hope
that the factory would be reopened, the workers did not raise any
serious issue pressing their long-standing dues. One of the creditors,
Madura Coats Ltd. Ltd. filed application for appointment of provisional
Arbitrator. By a judgment and order dated March 26, 2012 the learned
Judge appointed Official Liquidator as the provisional liquidator and
asked the provisional liquidator to take steps as against the fraudulent
transfer of the immovable properties referred to above. The Division
Bench termed it as Special Officer, however, did not disturb the process
of inventory. The company ultimately faced the final hearing of the
winding up proceeding.”
23. The above casts serious doubts as regards the validity of the
transaction and the unregistered agreement dated 25th September,
2006. I may note that Mr. Ray has placed strong reliance on the
judgement delivered in the case of Siddhpur Mills (supra) has
contended that the winding up order only relates back to the
commencement of the winding up proceedings to the date of
presentation of the petition and that any transfer made by the company
in liquidation after the presentation would be void unless directed by the
Court, however in the instant case, since the transactions are much
24 IA No.CA/61/2019
with IA No. CA/83/2021
with IA No. CA/386/2024
in CP 233 of 2008
prior to the winding up order which was passed on 31st January, 2013
which was later confirmed by the Appeal Court on 2nd May, 2013, the
validity of the transaction cannot be doubted and that the transaction
requires protection of equitable consideration. However, since, at this
stage, Eyelid only seeks leave to institute a proceeding and establish its
right in terms of the provisions contained in Section 446 of the
Companies Act, I am of the view that it shall not be prudent to deny
such leave to Eyelid without in any way conferring any right in favour of
Eyelid. Before concluding, I must note that in C.A. 83 of 2021 Eyelid has
also sought for orders for quashing the sale notice dated 9th September,
2021 and for recalling of the order dated 6th September, 2021. Since, by
an order dated 19th December, 2023, the Division Bench of this Court
has already directed the official liquidator to publish a fresh sale notice
by carrying out a fresh valuation and by granting liberty to both Eyelid
and Salasar to participate in the auction sale upon such revaluation
being obtained and upon publishing of fresh sale notice, and upon offer
being submitted, a report has been filed by the official liquidator, I am of
the view nothing survives in prayers ‘C’ and ‘E’ of the application being
C.A. 83 of 2021 as the aforesaid order dated 19th December, 2023 was
passed in presence of Eyelid. Having regard thereto, the application
being C.A. 83 of 2021 stands disposed of without any order. C.A. 386 of
2024 is allowed by granting liberty to Eyelid to institute a suit or
proceeding to establish its rights in accordance with law, if so advised.
25 IA No.CA/61/2019
with IA No. CA/83/2021
with IA No. CA/386/2024
in CP 233 of 2008
24. Insofar as C.A. 61 of 2019 is concerned, having regard to the order
passed on 3rd February, 2021, only in the event Salasar is able to match
the price bid of the highest bidder that the matter would require further
consideration.
25. Considering the above and noting from the report of the official
liquidator dated 8th February, 2024 that the official liquidator in terms
of the order dated 19th December, 2023 has taken steps for auction sale
of the property by e-auction conducted on 8th February 2024 through
designated e-auctioner of Railtel Corporation of India Pvt. Ltd., it
appears that it has received an offer and since, the above applications
are now disposed of, let C.P. 233 of 2008 be taken up for further steps
in relation to the sale notice dated 8th January, 2024. Accordingly, list
C.P. 233 of 2008 on 20th March, 2026, for considering the report of the
official liquidator regarding confirmation of sale.
Urgent photostat certified copy of this order, if applied for, be made
available to the parties, on priority basis, upon compliance of all
formalities.
(RAJA BASU CHOWDHURY, J.)