APHC010535062022 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI FRIDAY, THE NINTH DAY OF MAY TWO THOUSAND AND TWENTY FIVE PRESENT HONOURABLE MS JUSTICE B S BHANUMATHI COMPANY APPLICATION Nos.3Q of 2022 & 6 of 2023 COMPANY APPLICATION No.30 of 2022 in COMPANY PETITION Nos.10 to 16 of 1999 In the matter of the Companies Act, 1956 AND In the matter of M/s.Commercial Benefit Corporation and 6 other Firms (In Liqn.) Between: M/s.Commercial Benefit Corporation and 6 Other Firms, (In Liqn) Represented by the Official Liquidator, attached to the Honourable High Court of Telangana and Andhra Pradesh. ...Petitioner AND 1. Sri K Balaji Gupta, Sri K.BaIji Gupta, S/o.Late K.Satyanarayana Chetty, D.No.25-258, lyyakannau Street. Newpet, Palamaner, Palamaner Mandal, Chittoor District. yi— 2. Sri Sreepuram Sreenivasulu Chetty, S/o.Late Sri S.Narasimhulu Chetty, 16/22, Javali Street, Palamaner (Legal Heir of Late Sri S.Narasimhulu Chetty) 3. Sri Sreepuram Jaya Kumar, S/o.Late Sri S.Narasimhulu Chetty 16/22, Javali Street, Palamaner (Legal Heir of Late Sri S.Narasimhulu Chetty) 4. Sri Sreepuram Vijaya Kumar, S/o.Late Sri S.Narasimhulu Chetty 16/22, Javali Street, Palamaner, (Legal Heir of Late Sri S. Narasimhulu Chetty) 5. Sri Sreepuram Hari Kumar, S/o.Late Sri S.Nanda Gopal Chetty 16/22, Javali Street, Palamaner (Legal Heir of Late Sri S.Nanda Gopal Chetty) 6. Sri Sreepuram Suresh Kumar, S/o.Late Sri S. Nanda Gopal Chetty 16/22, Javali Street, Palamaner (Legal Heir of Late Sri S.Nanda Gopal Chetty ) 7. Sri Sreepuram Anitha, D/o.Late Sri S.Nanda Gopal Chetty 16/22 Javali Street, Palamaner (Legal Heir of Late Sri S. Nanda Gopal Chetty) 8. The Joint Sub-Registrar, Palamaner, Chittoor District, Andhra Pradesh ...Respondents Petition under Sections 481, 550 and 555 of the Companies Act, 1956, read with Rules 281, 282 and 9 of the Companies (Court) Rules, 1959 praying the High Court pleased to: i) Pass an interim order directing Sub-Registrar not to register any transfer alienation or encumbrance over the mortgaged properties until further orders of this Honourable Court. Dispense with the filing of the certified copies of the documents. Declare the sale deed No.3161/2022 dated 12-4-2022 as null and void. Direct the Sub-Registrar to cancel the Sale Deed No.3161/2022 dated 12-4-2022 in his records Order that the cost of this application do come out of the assets of the firms in liquidation. ii) iii) iv) V) 3 lA NO: 2 OF 2022 Petition under Rules 9 and 11 of the Companies (Court) Rules, 1959 praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to; (i) pass an interim order directing Sub-Registrar not to register transfer / alienation or encumbrance over the mortgaged properties until further orders of this Hon'ble Court; (ii) order that the cost of this application do come out of the assets of the firms in liquidation. any lA NO: 2 OF 2024 Between: Sri K Balaji Gupta, S/o.Late K.Satyanarayana Chetty, aged about 52 years, Occ: Business, R/o.D.No.25-252(A), lyyakannu Street, Kothapet, Palamaneru Mandal, Chittoor District. ...Petitioner AND M/s.Commercial Benefit Corporation and 6 Other Firms, (In Liqn) Represented by the Official Liquidator, attached to the Hon’ble High Court of Telangana and Andhra Pradesh. ...Respondent Petition under Rule 9 of the Companies (Court) Rules, 1959 praying that i the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to direct the official liquidator to in receive balance sale consideration of Rs.25,96,250/- towards sale consideration for regularization of sale. H lA NO: 3 OF 2024 Between: Sri K Balaji Gupta, S/o.Late K.Satyanarayana Chetty, aged about 52 years, Occ: Business, R/o.D.No.25-252(A), lyyakannu Street, Kothapet, PalamaneruMandal, Chittoor District. ...Petitioner AND M/s.Commercial Benefit Corporation and 6 Other Firms, (In Liqn) Represented by the Official Liquidator, attached to the Hon’ble High Court of Telangana and Andhra Pradesh. ...Respondent Petition under Rule 9 of the Companies (Court) Rules, 1959 praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to Regularize the Sale Deed vide No.3161/2022, dated 31-5-2022, registered in favour of the petitioner by the Joint Sub-Registrar, Palamaneru, Chittoor District. Document lA NO: 4 OF 2024 Between: Sri K Balaji Gupta, S/o.Late K.Satyanarayana Chetty, aged about 52 years, Occ: Business, R/o.D.No.25-252(A), lyyakannu Street, Kothapet, Palamaneru Mandal, Chittoor District. ...Petitioner AND M/s.Commercial Benefit Corporation and 6 Other Firms, (In Liqn) Represented by the Official Liquidator, attached to the Honourable High Court of Telangana and Andhra Pradesh. ...Respondent 5 Petition under Rule 9 of the Companies (Court) Rules, 1959 praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to vacate the interim order dated 30-9-2022 passed by this Honourable Court. lA NO: 1 OF 2025 Between; Sri K Balaji Gupta, S/o.Late K.Satyanarayana Chetty, aged about 52 years, Occ: Business, R/o.D.No.25-252(A), lyyakannu Street, Kothapet, Palamaneru Mandal, Chittoor District. ...Petitioner AND 1. M/s.Commercial Benefit Corporation and 6 Other Firms, (In Liqn) Represented by the Official Liquidator, attached to the Honourable High Court of Telangana and Andhra Pradesh. S.Hari Kumar, S/o.Late Nanda Gopal Chetty, aged about 54 years, Occ: Business, R/o.D.No.16/20-A-1, (New), 1 Palamaneru, Chittoor District. S.Suresh Kumar, S/o.Late Nanda Gopal Chetty, aged about 52 years, Occ: Business, R/o.D.No.16/20-A, (New) Ground Floor, Javali Street, Palamaneru, Chittoor District. 2. St Floor, Javali Street, 3. 4. S.V.T.Men’s Wear, Rep by its Proprietor, Jai Kumar @ Chitti S/o.Srinivasulu Reddy, aged about 30 years, Occ: Business, R/o.D.No. 16/20, (New) Ground Floor, Javati Street, Palamaneru, Chittoor District. ...Respondents Petition under Rule 9 of the Companies (Court) Rules, 1959 praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to Direct the Official Liquidator to take physical 6 possession of the Schedule -A property i.e., Chittoor District - Chittoor Sub- District, Palamaner Sub-Division & Revenue Mandal, Palamaner Village, Kothapeta, Javali Street in Sy.No. 568/2, situated at D.No. 16/22 & 23 (old) D.No. 16/20 (New). The house is situated in the following boundaries. East : House of Gandia chinnappa. West ; Javali Street, North : House of Nagaraju Chetty, South ; House(shop) of Nagandra In between east to West 210 feet or 64.05 meters. North to South 14 V2 Sq.ft or 4.422 meters, total 3045 sq.ft or 338.33 Sq.yds, site full in Terraced roofed house measuring 150x14.5 = 2220 sq. ft. In the first floor terraced roofed house measuring 70x14.5 =1015 sq.ft with doors. Door frames, almirahs, windows. Electrical stair cases, current service connections, including deposit full, municipal water tap, including deposited full. lA NO: 2 OF 2025 Between: Sri K Balaji Gupta, S/o.Late K.Satyanarayana Chetty, aged about 52 years, Occ: Business, R/o.D.No.25-252(A), lyyakannu Street, Kothapet, Palamaneru Mandal, Chittoor District. ...Petitioner AND 1. M/s.Commercial Benefit Corporation and 6 Other Firms, (In Liqn) Represented by the Official Liquidator, attached to the Honourable High Court of Telangana and Andhra Pradesh. 2. Mrs.S.Revathi, W/o.Late Srinivasulu Chetty, aged about 55 years, Occ; Housewife, R/o. D.No. 16/49 (New) Street,Palamaneru, Chittoor District. St Ground & 1 Floor, Javali 3. M/s.Bombay Fashion, Rep by its Proprietor, S.Ajgar, S/o.Syed Rough, aged about 40 years, Occ: Business, R/o.D.No. 16/49-1, (New) Ground Floor, Javali Street, Palamaneru, Chittoor District. ...Respondents Petition under Rule 9 of the Companies (Court) Rules, 1959 praying that in the circumstances stated in the affidavit filed in support of the petition, the Fligh Court may be pleased to Direct the Official Liquidator to take physical possession of the Schedule -B property i.e. Chittoor Sub-District, Palamaner Sub- Division & Revenue Mandal, Palamaner Village, Kothapeta Javali Street in Sy.No. 568/2, situated at D.No.16/54 & 55(old), Door No. 16/49, (new). The house is situated in the following boundaries. B-Schedule, Chittoor District - East : Javali Street, West : House of Shiva Lingaiah North : Vacant site of Shobha Silk Saree South ; ‘C’ Schedule property. In between east to west 170 feet or 51.85 meters. North to South 15 sq.fet or 4.575 meters. Total 2500 sq.ft or 283.33 sq.yds site full, then first floor Terraced roofed house measuring 50X15=750, with doors. Door frames, almirahs, windows, electrical fitting, stair cases, current service connection, including deposit full Municipal Water tap, including deposited full, municipal water tap, including deposited full. lA NO: 3 OF 2025 Between: Sri K Balaji Gupta, S/o.Late K.Satyanarayana Chetty, aged about 52 years, Occ: Business, R/o.D.No.25-252(A), lyyakannu Street, Kothapet, Palamaneru Mandal, Chittoor District. s ...Petitioner AND M/s.Commercial Benefit Corporation and 6 Other Firms, (In Liqn) Represented by the Official Liquidator, attached to the Honourable High Court of Telangana and Andhra Pradesh. S.Jaya Kumar, S/o.Late S Sri Narsimhulu Chetty, aged about 58 years, Occ: Business, R/o.D.No.16/50-1 (New), Ground & 1 Street, Palamaneru, Chittoor District. M/s.New Mummy Dady Men’s Wear, Rep by its Proprietor, S.Zakir, S/o.Munvar, aged about 30 years, Occ: Business, R/o.D.No.16/50-1 , (New) Ground Floor, Javali Street, Palamaneru, Chittoor District. 1. 2. St Floor, Javali 3. ...Respondents Petition under Rule 9 of the Companies (Court) Rules, 1959 praying that in the circumstances stated in the affidavit filed in support of the petition, the High Court may be pleased to Direct the Official Liquidator to take physical possession of the Schedule -C i.e., C-Schedule Chittoor District - Chittoor Sub- District, Palamaner Sub- Division & Revenue Mandal, Palamaner Village, Kothapeta, Javali Street in Sy.No. 568/2, situated at D.No. 16/56 & 57 (old), D.No. 16/50 (new). The house is situated in the following boundaries. East ; Javali Street, West : House of Shanmugam North ; ‘B’ Schedule property. South : House of Sripuram Sita Ramaiah Chetty In between east to west 170 feet or 51.85 meters. North to South 15 sq.ft or 4.575 meters, total 2550 sq.feet or 283.33 sq.yards site full, in then first floor terraced Roofed house measuring 170x15=2550 sq.ft then first floor terraced roofed house measuring 50x15=750 with doors. Door frames almirahs. windows, electrical fitting, stair cases, current service connection, including deposit full, water tap, including deposited full, including deposited full. Counsel for the Petitioner: Sri T V P Sai Vihari (SC for Official Liquidator) Counsel for Respondent No.1 : Sri Y Koteswar Rao Counsel for Respondent Nos.3 to 7:Srlnivasa Rao Bodduluri Counsel for Respondent No.8 :P Subash COMPANY APPLICATION No.6 of 2023 in COMPANY PETITION Nos.10 to 16 of 1999 In the matter of the Companies Act, 1956 AND In the matter of M/s.Commercial Benefit Corporation and 6 other Firms (In Liqn.) Between: 1. S.Suresh Kumar, S/o Late Nanda Gopal Chetty S.Hari Kumar, S/o Late Nanda Gopal Chetty S.Jaya Kumar, S/o Late Narasimhulu Chetty S.Vijaya kumar, S/o Late Narasimhulu Chetty S.Anitha, D/o Late Nanda Gopal Chetty All are resident of D.No. 16-20, 21/54 and 55, Javali Street, Kothapeta, Palamaner Village, Chittoor District. 2. 3. 4. 5. ...Applicants AND J 10 1. M/s Commercial Benefit Corporation and other firms (in Liqn), represented by the official Liquidator, attached to The Hon'ble High Court of Telangana and Andhra Pradesh. 2. K Balaji Gupta, S/o Late K.Satyanarayana Chetty, D.No.25-258, Jayyajannau Street, New pet, Palamaner, Palamaner Mandal, Chittoor District. ...Respondents Petition under Sections 456 and 457 of the Companies Act, 1956, read with Rules 6, 9, 272 and 273 of the Companies (Court) Rules, 1959 praying the High Court pleased to: a) Set-aside the sale deed No.3161 of 2022 dated 12.04.2022 executed in favour of the respondent no.2 b) Declare the applicants as the absolute owners and possessors of the schedule property, c) Direct the respondent no.1 to return the Original documents pertaining to the schedule property. Counsel for the Petitioners : Sri Srinivasa Rao Bodduluri Counsel for Respondent No.1: Sri T V P Sai Vihari (SC for Official Liquidator) Counsel for Respondent No.2: Sri Y Koteswar Rao The Court made the following order: APHC010535062022 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Jurisdiction) [3311] Friday, the ninth day of May two thousand and twenty five Present The Honourable Ms. Justice B. S. Bhanumathi Company Application No.30 of 2022 Between: M/s. Commercial Benefit Corporation and 6 other firms ...Applicants and Sri K. Balaji Gupta and others Counsel for the applicants: I.T. V. P. Sai Vihari (S.C. for Official Liquidator) Counsel for the respondents: I.Y.Koteswar Rao ...Respondents 2.P. Subash 3. Srinivasa Rao Bodduluri Company Application No.6 of 2023 Between: S. Suresh Kumar and others ...Applicants and M/s. Commercial Benefit Corporation and other firms (in liquidation) and others ..Respondents 2 BSB,J CompAppIn. Nos. 30 of 2022 and 6 of 2023 Counsel for the applicants: 1. Srinivasa Rao Bodduluri Counsel for the respondents: 1.Y. Koteswar Rao 2.T. V. P. Sai Vihari (S.C. for Official Liquidator) The Court made the following: 3 Bse, j CompAppIn. Nos. 30 of 2022 and 6 of 2023 COMMON ORDER Company Application No.30 of 2022 is filed for the following reliefs; i) pass an interim order directing Sub-Registrar any transfer / alienation i properties until further orders of this Court; ii) dispense with the filing of the certified copies of the documents; iii) declare the sale deed No.3161 as null and void; iv) direct the Sub-Registrar to I of 2022 dated 12.04.2022 in his records; V) order that the cost of this assets of the firms in liquidation; and vi) pass such order proper. The applicants, who , Application No.30 of 2022, filed Company Application the following reliefs; not to register or encumbrance over the mortgaged of 2022, dated 12.04.2022 cancel the sale deed No.3161 application do come out of the or orders as this Court may deem fit and 2. are the respondents No.3 to 7 in Company No.6 of 2023 for i) to set aside the sale deed No.3161 of 2022, dated 12.04,2022, executed in favour of the respondent No.2; ii) declare the applicants as the absolute possessors of the schedule property; owners and 4 BSB, J CompAppIn. Nos. 30 of 2022 and 6 of 2023 iii) direct the respondent No.1 to return the documents pertaining to the schedule property; iv) pass such other appropriate orders as deemed fit and proper in the circumstances of the case. The case of the applicant in C.A.No.30 of 2022 is briefly as below: This Court, by order, dated 02.09.2022, made in C.P.Nos.10 to 16 of 1999 ordered seven firms, namely, (i) M/s. The Commercial Benefit Corporation: (ii) M/s. Trade Development Corporation; (iii) M/s. The Merchants Benefit Corporation; (iv) M/s. Saptagiri Financiers; (v) M/s. The Mercantile Benefit Corporation; (vi) M/s. The Commercial Development Corporation; and (vii) M/s. The Commercial Finance Syndicate to be wound up and appointed the Official Liquidator as its provisional liquidator initially and thereafter appointed the Official Liquidator attached to this Court as its liquidator. 3. 3. a. On receipt of the winding up order, the ex-partners of the firms submitted statement of affairs to the Official Liquidator. As per the said statement, Sri Sreepuram Narasimhulu Chetty and Sri Sreepuram Nanda Gopal Chettty had availed certain loans from the above firms in liquidation for their business purposes and for their family expenditure by securing their personal properties situated at (i) D.No. 16/22 & 23, Javali Street, Kothapeta, Palamaner village, Palamaner Sub-division & revenue mandal, Chittoor District; (ii) D.No. 16/56 & 57, Javali Street, Kothapeta, Palamaner village, Palamaner Sub-division & town, Chittoor District and (iii) D.No. 16/54 & 55, Javali Street, Kothapeta, Palamaner village, Chittoor District and executed a mortgage deed in favour of firms, now in liquidation. While so, Sri Sreepuram Narasimhulu Chetty and Sri Sreepuram Nanda Gopal Chetty expired and Sri S.Sreenivasulu b. 5 BSBJ CompAppIri. Nos. 30 of 2022 and 6 of 2023 Chetty, Sri S.Jaya Kumar Chetty (R3) and Sri S.Vijaya Kumar (R4) came on record as legal heirs of Sri S.Narasimhulu Chetty and Sri S.Hari Kumar (R5), Sri S.Suresh Kumar (R6) and S.Anitha (R7) on record as legal heirs of Sri Sreepuram Nanda Gopal Chetty. The office of the Official Liquidator filed various applications against the came aforesaid legal heirs of the debtors for recovery of the debt amount and obtained various decrees against them. The details of the company applications are as shown below; SI. C.A.No. and date of order Name of the Firms in Liquidation Decretal amount No. 1. C.A.No.298/2001 Trade Development Corporation Rs.18,38,000/- with interest @ 18% per annum from 29-3-1997 ordered on 19-10- 2001 the date of realisation 2. C.A.No.413/2002 The Merchants Benefit Corporation Rs.16,22,000/- with interest @ 18% per annum from 29-3-1997 ordered on 22-09- 2003 till the date of realisation 3. C.A.No.410/2002 The Saptagiri Rs.14,55,750/- with interest @ 18% per annum from 29-3-1997 till the date of realization ordered on 22-09- Financiers 2003 4. C.A.Nos.595 & 596 of 2008 ordered on 12-06-2012 The Mercantile Benefit Corporation To pay the amount of Rs.9,00,000/- interest at 30% per with i 6 BSB,j CompAppIn. Nos. 30 of 2022 and 6 of 2023 annum with effect from 01.04.1997 till the date of realisation and also to pay Rs.5,80,500/- towards interest for the period from 07.02.1995 to 31.03.1997, which the failing Official Liquidator is permitted to take such action as is available in law to bring the mortgaged propertiesto sale. Thus, though the judgment debtors are liable to pay a total amount of Rs.63,96,250/- towards principal amount and interest thereon, they failed to pay the decretal amount, except Rs.1,00,000/- on different dates during 2008 & 2009. c. The office of the Official Liquidator filed C.A.Nos.595 & 596 of 2008 seeking permission to take possession of the mortgaged properties mentioned in schedules ‘A’, ‘B’ and ‘C’ and for a direction to the respondents to pay the debt amount as stated supra. This Court, by order, dated 12.06.2012, directed the debtors to pay the amount within two months failing which the Official Liquidator was permitted to take such action as is available to him in law to bring the mortgage properties for sale. d. 7 BSB, J CompAppIn. Nos. 30 of 2022 and 6 of 2023 The office of the Official Liquidator received letter, dated 21.09.2022 in Telugu language from S.Hari Kumar stating that he is residing in the property bearing D.Nos.16, 22, 23, 54, 55, 56 and 57. The letter dated 21.09.2022, as translated to English, reads as follows; “On 24.04.2019 my brother, namely, Sri S.Suresh Kumar gave a letter regarding the payment of debt amount of Rs.39,00,000/- and no reply has been received from office. Liquidator in the month of February and requested three months’ time for payment. But now we came to know that the office of the Official Liquidator had sold my property. We ready to pay the debt amount of Rs.39,00,000/- and request you to accept this proposal and give our property.” e. your Further, we also visited the office of the Official are f. On receipt of the above letter and on perusal of the copy of the sale deed, it is noticed that Sri Ramaiahgari Rama Krishna Reddy, S/o late R. Narasimha Reddy, company paid the staff working in the office of the Official Liquidator, executed a sale deed, dated 12.04.2022 in the matter of M/s. The Merchants Benefit Corporation, M/s. The Saptagiri Financiers and M/s.Trade Development Corporation in liquidation in favour of Sri K. Balaji Gupta, S/o late K.Satyanarayana Chetty, Kottapet, Palamnet Mandal, Chittoor District, for a consideration of Rs.39,00,000/- alienating the following three properties. ‘A’ Schedule The house bearing D.No. 16/22 & 23, Javali Street, Kothapeta, Sy.No.568/2, Palamaner Village, Palamaner Revenue Mandal & Sub- 8 BSB,j CompAppIn. Nos. 30 of 2022 and 6 of 2023 Division, Chittoor - Sub-District & District - within the following boundaries. East House of Gandlachinnappa West Javali Street North House of Nagaraja Chetty South House of Nagandra and others ‘B’ Schedule The house bearing D.No. 16/54 & 55, Javali Street, Kothapeta, Sy.No.568/2, Palamaner Village, Palamaner Revenue Mandal & Sub- Division, Chittoor - Sub-District & District - within the following boundaries. East :- Javali Street West :- House of Sivalingaiah North :- Vacant site of Shoba Silk Sarees South :- “C” schedule property ‘C’ Schedule The house bearing D.No. 16/56 & 57, Javali Street, Kothapeta, Sy.No.568/2, Palamaner Village, Palamaner Revenue Mandal & Sub- Division, Chittoor - Sub-District & District - within the following boundaries. East :- Javali Street West ;- House of Shanmugham North :- “B” schedule property South :- House of Sreepuram Sathyanarayana Chetty 9 BSB, J CompAppIn. Nos. 30 of 2022 and 6 of 2023 On verification, it was noticed that the sale deed furnished by Sri s. Hari Kumar is not signed by the Official Liquidator and the company paid Assistant same is signed by Sri R. Rama Krishna Reddy behalf of the office of the Official Liquidator and on the schedule property was sold to Sri K. Balaji Gupta. It further came to light that Sri R.Rama Krishna Reddy, the company paid Assistant, who was allotted the work of seven firms in liquidation in relation to debt recovery matters executed a sale deed No.3161 of 2022 in favour of K. Balaji Gupta posing himself as the authorized representative of the Official Liquidator in the office of the Sub-Registrar, Palamaner, Chittoor District. There are no notings on the files approving fhe draft sale deed or giving any authorisation to Rama Krishna Reddy to and further, no letters were addressed by the Official Registrar to register the sale deed, i.e., document No.C.S. No.3312 of 2022 & 3161 of 2022, dated 12.04.2022 execute the above sale deeds Liquidator to Sub registered on 31.05.2022. There is no entry in the outward register of the office of the Official Liquidator regarding dispatch of the letter, dated 25.05.2022. g) The Official Liquidator has not issued any authorisation letter or approved the execution of fhe sale deed by R. Rama Krishna favour of Sri K. Balaji Gupta. On verification Observed that Rs. 1,00,000/- Reddy in of the sale deed, it is was paid by the judgment debtors various dates in the year 2008 & 2009 and Rs.20,00, Sri K.Balaji Gupta on 25.02.2022 and Rs.18,00,000/ K.Balaji Gupta on 10.03.2022 as sale consideration office of the Official Liquidator for sale of the on 000/- was paid by - was paid by Sri I received by the subject property which is false for the reason that the said amount was accepted only towards Court enclosed to K.Aravind, Assistant Official recovery / repayment of debt. Various orders of this the sale deed contain signatures of Sri 10 BSB, j CompAppIn. Nos. 30 of 2022 and 6 of 2023 Liquidator with his stamp. A perusal of the letter, dated 25.05.2022 addressed to the Sub-Registrar, Palamaner, Chittoor district shows that Sri K.Aravind, Assistant Official Liquidator, executed sale deed in favour of Sri K.Balaji Gupta, requesting the Sub-Registrar to register the document and deliver the same to the claimant. Further, in the said letter, Sri R.Rama Krishna Reddy was authorised to present the sale deed before the Sub-Registrar for registration and requested for exemption of personal appearance of Sri K.Aravind before the Sub- Registrar. Sri K.Aravind has also attested the specimen signature of Sri R.Rama Krishna Reddy. Though the letter, dated 25.05.2022 signed by K. Aravind, Assistant Official Liquidator shows that he executed the sale deed, whereas the sale deed shows that Sri R.Rama Krishna Reddy executed the same. Further, the office copy of the letter, dated 25.05.2022, was not available in the office file and no noting relating to the above letter or permission to execute such sale deed was found in the file. h. Thus, in the present case, as the properties were mortgaged by deposit of title deeds, the question of sale of property does not arise and upon repayment of total debt due, the course left is only to execute a release mortgage deed in favour of the judgment debtors and that too, with the permission of the Court and in case of default in repayment of the debt due, the Official Liquidator was directed to proceed with the sale of the property as per law. However, in the present case, it is seen that no action was taken by the Official Liquidator for execution of the release of mortgage deed or initiation of proceedings for sale by filing necessary application before the Court for valuation of the property. The Sub-Registrar, Palamaner, before registering the document, failed to verify the mortgage and did not object registration of the document. 11 BSB, J CompAppIn. Nos. 30 of 2022 and 6 of 2023 Further, a stamp duty of Rs. 10,33,500/- and Rs. 1,59,000/- were paid for sale consideration of Rs.39,00,000/-. That registration fee of Itself shows that the property was undervalued and no objection was taken by the Sub-Registrar and the registration was completed without referring the matter to the Official Liquidator. Further, no order of the Court was enclosed to the sale deed confirming the sale in favour of Sri K. Balaji Gupta. The Sub-Registrar utterly failed to examine the availability of such order of the Court or write to the Official Liquidator seeking clarification about the In the absence of the above requirements, no sale can be registered in favour of any party. It was also noticed that the total decretal amount was not paid. Further, as per the procedure, any execution of sale deed is done only with the permission of the Court and the document is executed in favour of the party whose bid is approved by the Court and permission is accorded for execution of the sale deed and such sale deed shall be either signed by the Official Liquidator or the Assistant Official Liquidator. After execution of the sale deed either by the Official Liquidator or the Assistant Official Liquidator, a staff member is deputed to the office of the Sub-Registrar to present the sale deed on behalf of the Official Liquidator or the Assistant Official Liquidator. Whereas, in the present case, Sri R.Rama Krishna Reddy, company paid staff, prepared and executed the sale deed and presented for registration in the office of the Sub-Registrar, Palamaner, without any authority and therefore, the execution of the sale deed itself is prima facie null and void. same. i. Thus, as long as the entire debt amount with interest is not repaid, the firms in liquidation are legally entitled to recover the amounts from the mortgaged properties by bringing them for open auction by following due procedure prescribed under the Companies Act, 1956. 12 bsb,; CompAppIn. Nos. 30 of 2022 and 6 of 2023 Hence, it is just and necessary to safeguard the mortgaged properties from creation of any further third party rights or encumbrances thereon. In view of the above, the Official Liquidator filed company application No.30 of 2022. J- The respondent No.1 / purchaser filed a counter affidavit contending that the sale cannot be set aside on the ground that the mortgage was not released. In the absence of the payment of the amount due under the mortgage by the respondents No.2 to 7, the release of property in their favour does not arise and the only recourse available is sale of the property. Even assuming that such payment is not sufficient, the applicant has a charge over the property for the remaining amount and sale cannot be set aside on this ground. Having alienated the property and executed the sale deed in favour of the respondent No.1, the applicant cannot now contend that the office has been misled by R.Rama Krishna Reddy and that the documents were not available with them. The application is not maintainable and is liable to be dismissed. 4. The respondents No.3 to 7 filed a counter stating as follows: As per Section 446 of the Companies Act, 1956 (hereafter referred as “the Act, 1956”) once the winding up proceedings commenced and the Official Liquidator is appointed, all the suits, legal proceedings or claims by or against the company in liquidation shall be proceeded only through leave of the Court and this Court alone has jurisdiction to entertain any suit, claim, application by or against such company. Further, it is only the Official Liquidator that has the authority to institute or defend any suit, prosecution or other legal proceeding, civil or criminal, in the name and on behalf of the company as per 5. 13 BSBJ CompAppIn. Mos. 30 of 2022 and 6 of 2023 Section 457(1 )(a) of the Act, 1956. Section 457(2)(a) stipulates that it is the liquidator who has the authority to do all acts and to execute, in the name and on behalf of the company, all deeds, receipts, and other documents and for that purpose to use, when necessary, the company’s seal. In the instant case, the impugned sale deed was executed by of the employees of the applicant, but not the Official Liquidator and the same is prima facie evident from the sale deed. There is no authorization from the office of the applicant permitting R.Rama Krishna Reddy to represent and execute the sale deed in favour of the respondent No.1. Even otherwise, the execution of the sale deed is illegal without redemption of mortgage. Therefore, the sale deed is null and void ab initio. Further, R.Rama Krishna Reddy and K.Aravind the proper and necessary parties to the application and they ought to have been impleaded as party respondents. Finally, it is prayed to appropriate orders. 6. The respondent No.8 filed a counter stating that the answering respondent had not committed any irregularity while registering the document submitted by the office of the Official Liquidator and followed the procedure while registering the document. The company application is not maintainable as the applicant has not sought declaration that the authorisation is null and void and the same is to be set aside and unless the authorisation executed by the Assistant Official Liquidator in favour of R.Rama Krishna Reddy is set aside, the sale deed cannot be declared as null and void. Therefore, the application is liable to be dismissed. one are pass 7. The Official Liquidator filed re-joinder to the counter filed by the respondent No.1 stating that on a cumulative reading of the counter of the respondent No.1, it is evident that he is aware of the entire \ 14 bsb,; CompAppIn. Nos. 30of2022 and 6 of 2023 liquidation proceedings and decretal orders passed against the properties and also the fact that no action had been taken by the Official Liquidator for public auction of the properties and therefore, taking advantage of the same, the respondent No.1 conspired to grab the valuable property by playing fraud on the office of the Official Liquidator. The respondent No.1 also filed reply affidavit to the re-joinder stating that the contentions raised with regard to legal aspects are to be decided by the Court and the other contention that no sale can be registered with regard to the properties under mortgage is totally baseless and incorrect. The rest of the contentions are unsustainable and the company application is liable to be dismissed. Thus, aggrieved by the sale deed No.3161 of 2022, dated 12.04.2022, and not returning the property by the respondent No.1 / M/s. Commercial Benefit Corporation Limited, the applicants Nos. 1 to 5, who are the respondents No.6,5,3,4 and 7 in Company Application No.30 of 2022 respectively, filed Company Application No.6 of 2023 for the above noted reliefs with regard to properties shown in schedules ‘A’, ‘B’ & ‘C’ noted above with the averments briefly as follows: 8. 9. The contents of the counter filed in C.A.No.30 of 2022 by the petitioners herein may be read as part and parcel of this petition. The schedule properties originally belong to Sri Sreepuram Munuswamy Chetty from whom they were succeeded by Sri Sreepuram Narasimhulu Chetty and on his death intestate, they were succeeded by his four sons and seven daughters. The applicants are the grand children of Sri Sreepuram Narasimhulu Chetty. Thus, these properties are ancestral properties of the applicants who have right by birth in them. Family tree has been annexed to the application. The High Court of 15 BSBJ CompAppIn. Nos. 30 of 2022 and 6 of 2023 Andhra Pradesh, through the order dated 02.09.2002 in C.P.Nos.10 to 16 of 1999 ordered the above noted appointed the Official Liquidator appointed the Official Liquidator attached to the High Court Liquidator. The respondent No.1 filed various company applications seven forms to be wound up and as provisional liquidator and later as the against the borrower / legal heirs of the debtors for recovery of the debt against them, however, has not amount and obtained various decrees taken any steps for filing the execution limitation of 12 petitions. By now, the period of years from the date of the decree to file execution petitions expired. Therefore, it is deemed that the Official Liquidator have waived the right under the decrees and also in the schedule company applications filed by the Official properties. The details of Liquidators are follows: SI. C.A.No. Date of order Name of the firm No. 1 298/2001 19.10.2001 Trade Development Corporation ^^^'®rchants'Ben^Corporation Saptagiri Financiers Mercantiie'BenefirCorp^^ 2 413/2002 22.09.2003 3 410/2002 22.09.2003 4 595/2008 12.06.2012 & 596/2008 It was alleged that as the judgment debtors did not pay the decretal amount, except Rs.1,00,000/- on different dates during the years 2008 and 2009, the office of the official liquidator filed C.As.No.595 and 596 of 2008 seeking permission to take possession of the mortgaged properties shown in the schedules ‘A’, ‘B’ & ‘C’ and direction to the respondents therein to pay the debt amount. The High Court through 16 BSB, CompAppIn. Nos. 30 of 2022 and 6 of 2023 the order dated 12.06.2012 directed the debtors to pay the amount within two months failing which, the Official Liquidator was permitted to take such action as is available under law to bring the mortgaged properties for sale. But, as no steps have been taken so far, the action is barred by limitation and no steps can be taken against the schedule properties. The petitioners are in possession of the scheduleproperties. Since the amount of sale consideration of Rs.38,00,000/- was said to be paid and sale deed No.3161 of 2022 dated 12.04.2022 was executed by the Official Liquidator in favour of the respondent No.2 herein, C.As.Nos.595 and 596 of 2008 were closed. Upon the commencement of the winding up proceedings, it is only the Official Liquidator who has the power to institute or defend any suit etc., under section 457 (1) (a) of the Act, 1956 and to do all such acts and execute, in the name and on behalf of the company, all deeds, receipts and other documents, and for that purpose to use, when necessary, the company’s seal as per section 457(2)(a) of the Act, 1956. Upon receiving the petitioners’ representation dated 21.09.2022, the Official Liquidator conducted enquiries and came to know that the sale deed was executed by playing fraud by the staff of the Official Liquidator. Therefore, the Official Liquidator C.A.No.30 of 2022 to set aside the said sale deed and grant other reliefs. Since the original debtors availed loan of approximately Rs. 15,00,000/- under mortgage from the firms in liquidation, if the debt amount is cleared, the proper legal course is redemption of mortgage by returning the property to the mortgagors / debtors. Since the decrees obtained in the above stated company applications are time barred for execution, the rights over the schedule properties revert to the original owners / borrowers. As such, the petitioners are entitled to the schedule properties, being the legal heirs of the original borrowers. As per section 456 of the Act, 1956 r/w Rules 6, 9 ,272 and 273 of the Companies (Court) Rules, 1^59 17 BSB, J CompAppIn. Nos. 30 of 2022 and 6 of 2023 (hereafter referred as “the Rules, 1959”), this High Court has declare the debt of the borrowers power to as time barred and consequently direct the Official Liquidator to return the documents of the schedule assets of properties. The Official Liquidator has already sold the entire the firms in liquidation and the adjudication of the claims have also been completed and the dividends have been declared to all the the company and to the shareholders / partners. Therefore, there is no amount due to the above said firms or any creditor of the firms. The petitioners are economically not well settled and working hard to take their livelihood. The petitioner is a shop vendor selling daily needs and earns monthly salary of Rs. 10,000/-. The 3^'" petitioner is dependent on his children who are the daily wagers. Similarly, the other legal also are either dependents or not well settled. creditors of heirs 10. The respondent No.1 / Official Liquidator filed counter re-iterating the facts pleaded in the petition in C.A.No.30 of 2022 and further stating as follows: The Official Liquidator filed C.A.Nos.595 and 596 of 2008 before the High Court seeking permission to take properties, as the Judgment debtors are liable to Rs.63,96,250/- and interest possession of the mortgaged pay a total amount of per the orders in Company Applications noted above. The High Court permitted the Official Liquidator to take as possession of the mortgaged properties vide order dated 11.10.2013 But, the petitioners herein filed O.S.A.No.04 of 2014 further proceedings seeking stay of all pursuance of the order dated 11.10.2013 in in C.A.No.526 of 2013 in C.As.No.595 and 596 of 2008. The Court as well company as the High Court gave several opportunities to the petitioners to make payment of the decretal amount, however they did not pay the amount and now stated in the petition that the Offipial 18 BSB,j CompAppIn. Nos. 30 of 2022 and 6 of 2023 Liquidator had not taken any action. Further, the Official Liquidator deputed his staff on several occasions to take possession of the mortgaged properties, but the petitioners sought time on every occasion to hand over the possession on one plea or the other. Therefore, the action is barred by limitation is incorrect. The Official Liquidator is reserving right to take possession of the mortgaged properties. The Official Liquidator accepted the amount of Rs.38,00,000/- received vide D.D.No.555441 dated 24.02.2022 for Rs.20,00,000/- and D.D.No.555443 dated 07.03.2022 for Rs. 18,00,000/- towards receipt of the decretal amount only and it was entered in the books of accounts and shown in the half yearly account for the period from 01.10.2021 to 31.03.2022 which was audited under a certificate dated 10.12.2022. Hence, as is evident from the enclosed receipts and extract of the cash book, the Official Liquidator has not received the sale proceeds. The Official Liquidator did not execute the impugned sale deed dated 12.04.2022. Therefore, the contention of the petitioners that it was executed by the Official Liquidator in favour of the respondent No.2 is false and baseless. Thus, the Official Liquidator neither executed the sale deed nor received the sale proceeds. Moreover, the Official Liquidator filed petition in C.A.No.30 of 2022 for cancellation of the impugned sale deed. The legal provisions referred by the petitioners need no reply. No comments can be made by the Official Liquidator about the personal economic status of the petitioners. With regard to selling the assets of the firms in liquidation, completion of adjudication of the claims and declaration of dividends to the creditors and shareholders, it is stated that it requires no comments as it is not the subject matter of the petitioners. With regard to prayer to set aside the impugned sale deed, it is stated that the Official Liquidator has already filed C.A.No.30 of 2022 and to set aside the said sale deed which was 19 BSBJ CompAppIn. Nos. 30 of 2022 and 6 of 2023 Liquidator as is enquiry Liquidator revealed staff of the fraudulently executed without knowledge of the Official admitted by the petitioners in this petition by stating that the conducted on their representation to the Official execution of the impugned sale deed by playing fraud by the Officiai Liquidator. The reliefs (b) and (c) to declare the petitioners are the absolute owners and possessors of the schedule properties and to return the documents pertaining to those properties are absolutely illegal and cannot be granted, unless the petitioners herein pay the entire decretal amount to the Official Liquidator. It is prayed to dismiss the application with regard to these prayers (ii) and (iii), while re-iterating the reservation of the right to take appropriate action in pursuance of the earlier decrees. 11. The respondent No.2 / purchaser filed briefly as follows; counter with the averments The representative of the respondent No.1 / the Official sold the said properties to this respondent 12.04.2022 for Rs.38,00,000/-. The 2022 questioning the sale deed Liquidator under the sale deed dated respondent No.1 filed C.A.No.30 of and the petition is pending for adjudication along with this petition. The petitioners have not raised any on succession when the property was mortgaged to the companies / firms, nor have they made claim basing any claim till date. If they have a suit against all the any right in the property, they have to file companies and the Official Liquidator. The relief claimed by the petitioners is not maintainable as they are claiming right of succession. The company Court has no jurisdiction to decide the right claimed by the petitioners. The averments regarding previous company petitions need no answer. The contention of the petitioners that the Official recover the amount and the action is barrec^ by •Liqxiidator failed to 20 BSB,J CompAppln. Nos. 30 of 2022 and 6 of 2023 limitation is totally misconceived. The further contention that action of the Official Liquidator to take possession is barred by limitation is legally unsustainable. The claim of the Official Liquidator is that symbolic possession of the properties was taken even otherwise also, since the properties were mortgaged, no limitation as claimed arises. Moreover, on 27.06.2014, the petitioners gave an undertaking to the Official Liquidator that they would the amount within two months failing which the properties may be sold without any notice to them. The averments regarding deposit of amount of debt by these respondents and the sale of the properties in favour of these respondents are in controversy in C.A.No.30 of 2022 the maintainability of which is also in controversy. This respondent filed a counter to that petition. The averments regarding the loan availed by the original debtors and the remedy in case of non-clearance of the debt and the alleged failure of the Official Liquidator to recover the debt and consequent bar due to limitation are incorrect. A mortgage may be redeemed by paying the amount. As the not paid, the Court appointed a liquidator to sell the amount was property and recover the amount. Thus, the property was sold. There remains nothing to be redeemed. Limitation for sale of mortgage properties stated is incorrect. The contention that the petitioners are entitled to the right in the properties as legal heirs of the original borrowers is not based on proper legal principle. The legal provisions stated need no answer. However, it is stated that the provisions of the Act, 1956 which is no longer in effect have been repeatedly stated by the petitioners. The economic condition of the petitioners has no relevancy to the present petition and is denied since this respondent is not aware of their economic condition. This respondent prayed to dismiss the petition. 21 BSB, J CompAppIn. Nos. 30 of 2022 and 6 of 2023 12. As the dispute involved in both the applications same, both these applications are heard together and disposed through this common order. Heard the learned counsels for the parties and material record. IS one and the are being 13. perused the 14. The learned Standing Counsel for the Official Liquidator submitted that the title to the property was not vested with the Official Liquidator and the decree empowered recovery of money as per law which means that an execution petition shall be filed for recovery of money; however, by playing fraud, a sale deed was executed as though the Official Liquidator had authority to sell the property, that too, without following the procedure for alienation of the property of the liquidation mentioned above. company in 15. Before proceeding further, it is relevant to refer the relevant provisions hereunder; Rule 272: Sale to be subject to sanction and confirmation by Court - Unless the Court otherwise orders, no property belonging to a company which is being wound-up by the Court shall be sold by the Official Liquidator without the previous sanction of the Court, and every sale shall be subject to confirmation by the Court. Rule_273; Procedure at sale - Every sale shall be held by the Official Liquidator, or, if the judge shall so direct, by an agent an auctioneer approved by the Court, and subject to such terms and conditions, if any, as may be approved by the Court. All sales shall be made by public auction or by inviting sealed tenders or in such manner as the Judge may direct. to or 22 BSB,j CompAppIn. Nos. 30 of 2022 and 6 of 2023 Section 537: Avoidance of certain attachments, in winding up by, or subject to executions, etc., supervision of, Court:- (1) Where any company is being wound up by or subject to the supervision of the court - (a) any attachment, distress or execution put in force, without leave of the court, against the estate or effects of the company, after the commencement of the winding up; or (b) any sale held, without leave of the court, of any of the properties or effects of the commencement: shall be void. 2) Nothing in this section applies to any proceedings for the recovery of any tax or impost or any dues payable to the Government. company after such Section 446: Suits stayed on winding up order:- (1) When a winding up order has been made or the Official Liquidator has been appointed as provisional liquidator, no suit or other legal proceeding shall be commenced, or if pending at the date of the winding up order, shall be proceeded with, against the company, except by leave of the Tribunal and subject to such terms as the Tribunal may impose. (2) Tribunal shall, notwithstanding anything contained in any other law for the time being in force, have jurisdiction to entertain, or dispose of- (a) any suit or proceeding by or against the company; (b) any claim made by or against the company (including claims by or against any of its branches in India); (c) any application made under Section 391 by or in respect of the company; 23 BSB, J CompAppIn. Nos. 30 of 2022 and 6 of 2023 (d) any question of priorities or any other question whatsoever, whether of law or fact, which may relate to or rise in course of the winding up of the company, whether such suit or proceeding has been instituted or is instituted or such claim or question has arisen or arises or such application has been made or is made before or after the order for the winding up of the company, or before or after the commencement of the Companies (Amendment) Act, 1960 (65 of 1960). 3. (omitted by Act 11 of 2003, Section 61) 4. Nothing in Sub-section (1) or Sub-section (3) shall apply to any proceeding pending in appeal before the Supreme Court or a High Court. Section 457: Powers of Liquidator: The Liquidator in a winding up by the [Tribunal] shall have power, with the sanction of the [Tribunal] [substituted by Act 11 of 2003, Section 67, for" Court"],- to institute or defend any suit, prosecution, or other legal proceeding, civil or criminal, in the name and on behalf of the company: XX xxxx (1) (a) (b) (c) XX xxxx (d) XX xxxx (e) XX xxxx (2) The Liquidator in a winding up by the Tribunal shall have power- (i) to do all acts and to execute, in the name and on behalf of the company, all deeds, receipts, and other 24 BSB,j CompAppIn. Nos. 30 of 2022 and 6 of 2023 documents, and for that purpose to use, when necessary, the company's seal; to inspect the records and returns of the company the files of the Registrar without payment of any fee; [Inserted by Act 65 of 1960, Section 170 w.e.f. 28.12.1960]....” The learned counsel further submitted that Rule 272 of the Rules, 1959 prescribe that the Official Liquidator can sell the property subject to leave of the Court, and therefore, there is no independent authority to an Official Liquidator to directly sell the property without such leave and the procedure is also stated in Rule 273 of the Rules, 1959 thereof, but the same had not been adopted in the present case. Further, in addition to Rules 272 & 273 stated aforesaid corresponding provision of law is Section 537(1 )(b) of the Act, 1956 which shall be followed for execution of a sale deed, and therefore, a conjoint reading of these provisions make it clear that a sale deed cannot be directly executed by the Official Liquidator without the leave of the Court. (ia) on 16. the In this regard, it is also pertinent to mention Section 457 of the Act, 1956 which speaks of the powers of the Official Liquidator, makes it clear that the proceedings taken to execute the sale deed are beyond such powers. Further, he submitted that the so called authorisation to the Assistant Official Liquidator does not authorise him under law to execute the sale deed as the High Court did not permit him under Section 457 of the Act, 1956. He submitted that selling the property worth Rs.1 crore for Rs.38 lakhs demonstrates the fraud played. Since the amount is with the office of the Official Liquidator, he submitted that the purchase amount would be paid back to the purchaser, if the Court directs, along with the interest accrued thereon, so that the purchaser 17. 1! 25 8SB,J CompAppIn. Nos. 30 of 2022 and 6 of 2023 also does not incur any loss. In addition thereto, he submitted that appropriate steps would be taken to recover the amount as per law since the decree so directed. The respondent No.1, the purchaser, submitted as in the counter, but could not substantiate that the Official Liquidatoris empowered to execute the sale deed or that the procedure under law to alienate the property of a company in liquidation was duly followed. It is obvious that the decree empowered the Official Liquidator only to recover the amount as per law and the authority allegedly exercised by the Official Liquidator through R.Rama Krishna Reddy in executing the sale deed is beyond the scope of the decree and without following the procedure under law discussed above. That apart, even where a liquidator is empowered to sell the property, the procedure indicated in the above provisions shall be scrupulously followed. The above provisions abundantly make it clear that the sale without the leave of the Court is not permissible. Direction in the decree cannot be taken as leave contemplated in the above rules. Therefore, the sale deed impugned in the petitions is null and void and liable to be cancelled as vitiated for not following the legal procedure. There is no pleading or proof that the possession of the property sold was delivered to the vendee. 18. 19. As such, the relief of declaring that the sale deed No.3161 of 2022, dated 12.04.2022 is null and void and consequent direction to the Joint Sub-Registrar, Palamaner, can be granted. The relief claimed to meet the expenses of the application can also be granted. For the to grant the relief of declaration, the relief of setting aside the sale deed No.3161 of 2022, dated 12.04.2022 can be granted. 20. same reasons 26 BSB, j CompAppIn. Nos. 30 of 2022 and 6 of 2023 21. Though it was stated that the properties of Sri Sreepuram Narasimhulu Chetty, on his death intestate,. were succeeded by his four sons and seven daughters and such legal heirs / representatives of petitioners. On setting aside the impugned sale deed, remains with those who were the owners averment was not denied, all the both the deceased are not the the ownership as on the date of the impugned sale as there is of title to their legal representative no other alienation subsequently, except flow as per law on their death. Under these circumstances, the relief of declaration of the ownership of the petitioners sought over the schedule properties is not granted. 22. Since the sale transaction is vitiated as illegal, and the Official Receiver contended that the consideration, but as discharge of debt amount was not received as sale amount; and further there is reply affidavit filed denying the same or shown that the amount and received only as sale consideration and discharge of the debt amount due no was paid not appropriated towards nor is there any prayer for refund of the amount in case of cancellation of the sale deed, the Rs.38,00,000/- received cannot be amount of now ordered to be refunded to the person who paid it. The Official Receiver can take separate steps in this regard as per law depending on the nature of the receipt of the amount and the stage of settlement of all the claims of the claimants as per law. 23. The petitioners have not denied the affidavit of the respondent No.2 that the averment in the counter petitioners had given a conditional undertaking dated 27.06.2014. Similarly, there is no denial of the previous steps taken by the Official Receiver stated in the counter affidavit of the Official Receiver. If an application under Order XXI C.P.C. is filed, the objection of executability of the decree by limitation of period of 12 being barred years can be considered. If the Official r 27 BSBJ CompAppIn. Nos. 30 of 2022 and 6 of 2023 Receiver initiates any step, depending on the provision of law under which such step is initiated, the question of limitation can be answered. There is no answer from the petitioners about the order of stay of all further proceedings in pursuance of the order dated 11.10.2013 in C.A.No.526 of 2013 in C.As.No.595 and 596 of 2008, if any granted in O.S.A.No.04 of 2014. Under these circumstances, the question of limitation to realise the amount of debt can be decided when such step is taken. The documents can be returned only on redemption of mortgage. r 24. C.A.No.30 of 2022: In the result, the application is allowed declaring that the sale deed No.3161 of 2022, dated 12.04.2022, Joint Sub-Registrar, Palamaner is null and void and directing the Sub-Registrar, Palamaner to cancel the sale deed, dated 12.04.2022 in the records. The expenses of the application shall be borne out of the assets of the firms in liquidation. The Official Receiver can take separate steps with regard to appropriation or disbursement or refund of Rs.38,00,000/- as per law. There shall be no order as to costs. Pending miscellaneous petitions, if any, shall stand closed. C.A.No.06 of 2023: In the result, the application is allowed setting aside the sale deed No.3161 of 2022, dated 12.04.2022, Joint Sub-Registrar, Palamaner; and directing the respondent No.1 to return the documents pertaining to the schedule properties to the legal heirs of the original borrowers on 28 BSB,J CompAppIn. Nos. 30 of 2022 and 6 of 2023 discharge of mortgage debt other than by way of sale of the properties mortgaged as per law. There shall be no order as to costs. Pending miscellaneous petitions, if any, shall stand closed. Sd/- E KAMESWARA RAO JOINT REGISTRAR ^ //TRUE COPY// SECTION OFFICER To 1- The Official Liquidator, M/s. Firms (in liqn), Office Commercial Benefit Corporation at 1 and 6 other Nagole, r Mandal, Ranga Reddy Floor, Corporate Bhawan Bandlaguda, Thattiannaram Village, Hayathnaga District, Telangana State Pin Code-500 680. 2. The Registrar of Companies, ,, Ministry of Corporate Affairs, Government 2 Floor, Corporate Bhawan of India, ■ Nagole, Bandlaguda, Tha„,annaram Village, Hayathnagar Mandal, Ranga Reddy District, Telangana State Pin Code-500 680 3. The Regional Director South Eastern Region, Ministry of Corporate Corporate Bhawan Affairs, 3''^ Floor, -T-. ... NOagole, Bandlaguda Thattiannaram Village, Hayathnagar Mandal, Ranga Reddy District Telangana State Pin Code-500 680. 4. One CC to Sri T V P Sai Vihari (Standing Counsel for Official Liquidator) [OPUC] 5. One CC to Sri Y Koteswar Rao, 6. One CC to Sri P Subash Advocate [OPUC] Advocate [OPUC] 7. One CC to Sri Srinivasa Rao Bodduluri, 8. The Section Officer, Advocate [OPUC] O S- Section, High Court of Andhra Pradesh 9. Two CD Copies TK sree HIGH COURT DATED:09/05/2025 COMMON ORDER COMPA Nos.30 of 2022 & 6 of 2023 allowing the company applications