KARACHI: Sindh govt opposes sale of land: Liquidation case
By Our Staff Reporter
KARACHI, Aug 2: The provincial government requested the Sindh High Court on Friday to reject a reference filed by its official assignee for the sale of 15 acres of its prime land near the civic centre in liquidation proceedings.
The impugned reference was moved by official assignee Bashir A. Memon in his capacity as official liquidator for Electric Lamp Manufacturers Limited, which had defaulted on repayment of a loan to the Pakistan Industrial Credit and Investment Corporation (Picic). The concern had mortgaged the state land leased out to it by the government till November 1998. The lease was first got renewed at the rate of Rs450 per square yard against the official rate of Rs50,000 per square yard and the prevailing market rate of Rs120,000 per square foot. The land was then sought to be sold for Rs300 million to a bidder to pay off the company’s debt to the corporation.
The proceedings were allegedly being conducted behind the back of the provincial government, the owner of the land. The advocate-general’s office acted just in time to preempt the sale. It first moved for the provincial government to be impleaded as an intervener in the liquidation proceedings and then filed objections to the sale reference through Additional Advocates-General Abbas Ali and Suleiman Habibullah.
According to the objections filed on behalf of the Sindh government, the land in question is not an asset of the insolvent company and could not be sold in liquidation proceedings. It reverted to the government in November 1998. The company in liquidation was a mortgagor and Picic, the mortgagee, had no better title than the company. The official assignee or the liquidator had no authority to put the land on sale.
Without prejudice, the government said in its objections, the bidding for the land was not transparent. In the absence of a public notice, a new offer of Rs270 million was received from a party that did not participate in the auction proceedings. On the same day, that is, June 9, 2003, another bidder who had earlier offered Rs260 million enhanced his offer to Rs300 million. There is no separate mention in the reference of the amount offered for movable assets of the company, including its machinery and equipment.
The government accordingly requested the court to reject the reference moved by the assignee/liquidator.
