New Ideal Engineering Works Ltd. (Petitioner)
Bangladesh Shilpa Bank and others (Respondents)
MH Rahman J
ATM Afzal J
Mustafa Kamal J
Latifur Rahman J
Judgment : February 16th, 1993.
Dr. Kamal Hossain, Senior Advocate, Supreme Court instructed by Kazi Shahabuddin Ahmed, Advocate-on-Record-For the Petitioner
Shamsul Haque Siddique, Advocate-on-Record-For the Respondent Nos. 1-6
Sharifuddin Chaklader Advocate-on-Record-For the Respondent No. 8
Civil Petition for Leave to Appeal No. 27 of 1993.
(From the Judgment and Order dated 7.12.92 an 9. 12.92 passed by the High Court Division Dhaka in Writ Petition No. 1625 of 1992).
JUDGEMENT ATM Afzal J.- Short background of this petition is that the petitioner, a Private Limited Company, took loan from the Bangladesh Shilpa Bank, briefly BSB, for a project of light engineering workshop, built a factory building only, but never started the project; rather let out the factory building to respondent No. 8, a Garment Factory, in violation of the loan agreement and became a defaulter in repayment of the loan to the extent of Tk. 24,94,333.00 as on 31.12.89. The Bank decided to go for sale of the project assets under Article 34 of the Bangladesh Shilpa Bank Order 1972 for realization of its loan. The petitioner unsuccessfully filed Writ Petition No. 763 of 1990 challenging the decision of the BSB to sell its assets and the leave to appeal from the Judgment of the High Court Division was also dismissed by this Division on 21.5.1990.
2. Then the petitioner filed the present Writ Petition No. 1625 of 1990, this time calling in question the validity of the sale of the project assets upon negotiation to respondent No. 8 and delivery of the sale certificates in pursuance thereof.
3. The High Court Division by the impugned Judgment dated 9 December 1992 discharged the M in the said writ petition.
4. In order to appreciate the point raised by Dr. Kamal Hossain, learned counsel for the petitioner in this petition, some facts are necessary to be noticed. The BSB published the sale notice in the daily ‘Dainik Bangla on 12.4.90 calling tender by 23.4.90. On 14.4.90 respondent No. 8 offered to purchase the assets of the petitioner Company on payment of the entire dues of the Bank i.e. Tk. 24,94,333.00. The Bank by its resolution dated 17.4.90 accepted the offer of respondent No. 8 upon canceling the tender fixed on 23.4.90. Because of stay order from the Court, the Bank could not inform respondent No. 8 about acceptance of its offer until 24.5.90. On 29,5.90, respondent No. 8 paid the entire money by pay order and asked for sale certificate and possession. The Bank issued sale certificate in favour of respondent No. 8 on 2.6.90 and as respondent No. 8 was already in possession of the premises of the company no formal delivery was necessary.
5. Dr. Hossain questioned the authority of the Bank to sell the property by private negotiation when the Bank had already called public tender and the last date for tender was yet to expire on 23. 4.90. He drew our attention to rule 70) of the Bangladesh Shilpa Bank (Direct Sale of Mortgaged Property) Rules, 1980 which says that the Bank may also sell the mortgaged property by private negotiation with the approval of the Managing Director, if reasonable price for the mortgaged property is not offered by any bidder or tenderer. It is contended that by accepting the offer of respondent No. 8 on 17.4.90 the aforesaid provision was violated, public offer, which could be much more, was pre-empted and the same was done malafide and for a collateral purpose. Dr. Hossain submitted that the High Court Division rejected this contention of the petitioner upon wrongly relying on Fairtech Limited and ors Vs. Bangladesh Shilpa Bank and others reported in 42 All (AD) 216, the facts of which are different from oat of the present case. Although under rule 5 of the Rules, the Bank is authorised to sell the mortgaged property even by private negotiation, Dr. Hossain submitted that since notice calling tender bad already been issued in the present case, the Bank could resort to sale by private negotiation only in terms of rule 7(3) and not otherwise.
6. It cannot be laid down as a general rule that a sale by private negotiation which the Bank has got power to do under rule 5 generally will be invalid ab initio because the auction or tender process which has begun has not been exhausted. When such a sale by private negotiation takes place and the matter is brought to the court, the question for consideration should whether there was any malafide or lack of proper consideration in the transaction. In the instant case there is nothing on record to show, that the Bank had acted malafide or imprudently in the matter. Rather from the facts and relevant resolutions of the Bank which have been produced before us it is found that there were justifiable grounds for selling the property to respondent No. 8 who was already running an industry in the premises, let out by the petitioner. It is not the petitioner’s case that it was also an intending tenderer nor there is anything to show that there were other prospective tenderers with higher offers. It appears that tender was called earlier also and respondent No. 8 alone made an offer of Tk. 20 lakhs which was now raised to cover the entire dues of the bank.
7. The petitioner, who was not only a defaulter, was alleged not to have started the Engineering Works at all for which the loan was taken, instead the premises was let out to respondent No. 8 and others for other purposes. Thus we find neither any merit in the point raised nor the petitioner appears to have come with clean hands. We have noticed with displeasure that the petitioner has not even included in this petition the affidavit?in? opposition filed by the respondent Bank in the High Court Division which amounts to withholding of material facts and is a further instance of unclean conduct.
The petition is dismissed.
Source : 45 DLR (AD) (1993) 138