M/S Sri Venkata Balaji Jute Mills PVT. LTD (In Liqn) vs. Andhra Bank

Held

The Court allowed the Company Application. It appointed Sri R. Ramakrishna Rao, a Registered Valuer from Visakhapatnam, to conduct the valuation of the Land and Buildings, Plant & Machinery, stocks, and Office Furniture of M/s Sri Venkata Balaji Jute Mills Pvt. Ltd. (in liquidation). The Court fixed the valuer's fees at Rs. 45,000/- plus 18% GST, along with Rs. 6,000/- for conveyance. The respondent was directed to pay this fee to the valuer, with the understanding that it would be reimbursed from the sale proceeds of the company's assets on a priority basis. The Official Liquidator was permitted to review the valuation report and file necessary applications for the sale of the company's properties. The cost of the application was ordered to be borne by the assets of the company. Any pending interlocutory applications in this case were closed.

Facts

M/s Sri Venkata Balaji Jute Mills Pvt. Ltd. (in liquidation) filed a Company Application seeking the appointment of a Registered Chartered Valuer for the valuation of its assets, including land, buildings, plant and machinery, stocks, and office furniture. The petitioner sought directions for the valuer's fee to be paid by the respondent and reimbursed from sale proceeds. The Court, by an order dated January 25, 2023, appointed Sri R. Ramakrishna Rao, a Registered Valuer, to visit the company's premises and submit a report. Subsequently, the valuer submitted a quotation for his professional fee, which included Rs. 45,000/- for land and building and plant & machinery, plus 18% GST, and Rs. 6,000/- for conveyance. The valuer also requested specific documents for the valuation. The learned Standing Counsel for the respondent confirmed that the required documents would be provided.

Key Issues

1. Whether the Court should appoint a Registered Chartered Valuer for the valuation of the assets of the company in liquidation, as prayed for by the petitioner? 2. What should be the professional fee of the appointed valuer, and how should it be paid? Petitioner's arguments: The petitioner, M/s Sri Venkata Balaji Jute Mills Pvt. Ltd. (in liquidation), argued that the appointment of a valuer is necessary for the proper realization of the company's assets. They sought directions for the valuer's fees to be fixed and paid by the respondent, with reimbursement from the sale proceeds on a priority basis. They relied on the provisions of the Companies Act, 1956, and the Companies (Court) Rules, 1959, for seeking such relief. Respondent's arguments: The respondent, Andhra Bank (now Union Bank of India), through its learned counsel, did not appear to contest the appointment of the valuer. The judgment indicates that the respondent's counsel submitted that all required documents would be provided to the valuer, implying an acceptance of the valuation process.