Bengaluru: Dismissing an application filed by Brunton Developers, the high court recently directed the official liquidator to take possession of a property unit situated on the third floor of the ‘Canberra’ Block in UB City, along with the open space attached to it, and auction the same.
The petitioner claimed that the company in liquidation — United Breweries (Holding) Limited — which stood as guarantor for money lent to the beleaguered Kingfisher Airlines, sold the property spread over 3,831.8 square feet, including 2,531.6 sq ft of super built-up area for Rs 3 crore. It sought a direction for the issuance of khata and other documents.
According to the applicant, the amount paid for the transaction was in excess of the guidance value by nearly Rs 31 lakh, as a valuer assessed the property unit valued at nearly Rs 2.7 crore.
However, Justice Suraj Govindaraj, noted that the sale deed dated May 21, 2012 and executed by the company in liquidation in favour of the applicant, is void as the same was done after the commencement of the winding-up proceedings, i.e, post-March 26, 2012.
The court also pointed out that, as per the memo submitted by the official liquidator on the sales that took place during 2011, a 15th floor property of Canberra Block fetched Rs 11.3 crore (Rs 12,392/sq ft), a 10th floor property Rs 9.8 crore (Rs 12,540/sq ft) and a 3rd floor property Rs 2.8 crore (Rs 14,520/s qft) as against Rs 3 crore for the building in question (Rs 7,829/sq ft).
“The price at which the subject property has been sold to the applicant is not the market value at the time of the sale. The valuation is much less than the value at which the developer sold his share of the same unit under a contemporaneous document. The measurements indicated also being completely different, the transaction is not bona fide and has been structured in a way to benefit a party related to the managing director of the company in liquidation,” the judge observed while invalidating the sale.
The judge noted that the winding-up petition was filed on March 26, 2012, the sale was done on May 21, 2012 and the winding-up order was passed on February 7, 2017.
“The present application filed on June 30, 2023, is clearly and ex facie and barred by limitation in terms of Article 113 of the Limitation Act 1963. This again, not taking into account that the applicant has not sought validation of the sale deed,” the judge further added.
The jugde directed the jurisdictional sub-registrar to cause entries in his books about the sale deed being void and cancel the entries relating to it in his register. The official liquidator was directed to take possession of the property forthwith and auction.