Law: Companies Ordinance, 1984

Section: 305

Companies Ordinance (XLVII of 1984)--Ss. 305, 319 & 338(5)---Companies Court Rules, 1997, R.3---Winding up of company---Judicial sale of company--­Applications for withdrawal of winding up order and recalling and setting aside sale order---Company in question was wound up and joint official liquidators who assumed the charge of assets and properties of company, proceeded to sell the same under orders of the Court---Highest bid was approved and all concerned agreed to sale price as offered by the bidder---Applicant seeking withdrawal of winding up order and setting aside sale order, offered a scheme of rehabilitation and contended that one investor was prepared to take assets of company and was prepared to make down payment a certain amount and balance in 10 years in 20 equal bi-annual instalments---Sale of assets and properties of company was duly advertised, but nobody came forward to object thereto---Sale having been confirmed and approved by the Court, could not be set at naught by suggesting or offering a restructuring scheme by a third party--­Proceedings of judicial sales were held under the umbrella of the Court, all steps taken towards such a sale were taken under the orders passed by the Court---Concept of stability of judicial sale reflected sanctity attached to the commitment of the Court---Apart from the two contracting parties, in the matter of judicial sales, the interest of public at large and commercial morality was also to be considered for if the sale was to be set aside simply on basis of better offer, it would give leverage to all contracting parties to proceed to cancel or rescind their commitment if they got better offer than one settled/accepted by them---Such a course definitely would lead to absurd results and would tend to develop a culture in the mind of common man that if the judicial sale could be set aside on receiving a better offer, why could not a common man refuse to abide by his commitment if a better offer was received by him---One should remain bound by his commitment, be it a case of common man or a Court---Total proceedings culminating in judicial sale, in case could not be set at naught, in…

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