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M/S. AL-CAN Export Pvt. Ltd. vs. Prestige H.M. Polycontainers Ltd.

Not available · 2024 INSC 500Decided 9 Jul 2024
Not available
Justice J.B. Pardiwala · Justice Manoj Misra

Background

The dispute concerned a plot of land in Maharashtra that was auctioned by state revenue authorities to recover dues, and later purchased by the appellant company, which set up and ran an oxygen-cylinder manufacturing plant on it for about 15 years, employing around 200 people. The appellant challenged an appellate authority's order (under the Maharashtra Land Revenue Code) affecting its title/possession, and the Bombay High Court dismissed its writ petitions, prompting this appeal.

Decision Breakdown

The Supreme Court examined two legal questions: whether the Civil Procedure Code's rule for setting aside execution sales (Order XXI Rule 90) applies to writ proceedings challenging a revenue-authority auction, and whether the Additional Commissioner had jurisdiction to decide the appeals under Section 247 of the Maharashtra Land Revenue Code. Finding no legal error in the High Court's judgment upholding the auction and appellate proceedings, the Court nevertheless recognized that simply affirming the order would force the shutdown of a functioning factory employing 200 workers. It therefore crafted an equitable remedy: the appellant could retain the property and its plant by depositing Rs. 4 crore with the secured creditor (ARCIL) within six months in full settlement, failing which the authorities could take over the land for fresh auction.

Lesson Learnt

Even where a court finds no legal fault in the order under challenge, it can still mould practical relief, such as offering a payment-based settlement, to avoid disproportionate real-world harm (like shutting down a running factory and displacing workers) while respecting the rights of all parties involved.

Official source (sci.gov.in)View Judgment (PDF)

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