Sardar Muhammad Raza Khan, J.--Ibrahim Shamsi, Abdullah Rafi and Maulvi Syed Iqbal Haider seek leave to appeal against orders dated 4.4.2005 and 18.4.2005 passed by the learned Company Bench of Sindh High Court whereby official assignee' Reference No, 3 of 2005 was disposed of with remarks that the official assignee had received an improved bid of rupees 461 million as against a bid of rupees 450 million previously being the highest and that the two last bidders be called by the official assignee in order to make close bid among themselves and at the same time to call upon EPZ authority to participate in the proceedings, if interested.
2. Almost admitted background of the case is that vide order dated 6.4.2004 winding up order of M/s Sindh Alkalis Limited Karachi was passed by the Company Bench and Bashir Ahmed Memon, Respondent # 1, was appointed as official liquidator. Through another order dated 20.9.2004 the official liquidator was directed to sell all the assets of the company.
3. The auction proceedings were conducted where bids were offered and subsequently improved through negotiation. The final position that emerged was as follows:- S. No, Name of Bidder Previous OfferImproved Offer 1 Mr. Ibrahim Shamsi Rs, 26.00 CroreRs, 45.00 Crore 2 M/s Semand Pak. -- Rs, 44.80 Crore 3 M/s Tufail Group Rs, 29.25 CroreRs, 40.25 Crore 4 Mr. M. Iqbal Ahmed -- Rs, 36.55 Crore 5Mr. M. Yousuf H. Ali Dangra Rs, 30.00 Crore No improvement
4. Based on the above conditions, the official assignee prepared and made Reference # 2 of 2005 for approval of the Court. While the hearing of this reference was pending, the official assignee informed the Court that a new bidder had come forward ready to raise the bid as against the highest, mentioned above. The Court adjourned the matter for 11.4.2005 and ordered that a fresh reference to the above effect be made and that Reference No, 2 of 2005 shall be taken up along therewith. Ibrahim Shamsi etc, the previous highest bidders filed objections thereto expressing their reservations about the order aforesaid dated 4.4.2005. On 8.4.2005, the learned Court passed an order that "let the Objections and all the pending applications and References be fixed on 3.5.2005 after due notice to the Official Assignee". Before that the matter could come up accordingly, the impugned order dated 18.4.2005 was passed and hence this petition.
5. The first and foremost objection raised by the learned counsel for the canveators was that this petition before the Supreme Court was not maintainable under Section 10(1) of the Companies Ordinance 1984, and the petitioners, if at all aggrieved, ought to have filed an Intra Court Appeal under Section 10(2) of the Ordinance. Learned counsel for the petitioners maintained that the petition filed before the Supreme Court was perfectly in accordance with law. Before discussing this legal aspect of the case, it would be convenient to reproduce Section 10 of Ordinance 1984: "10. Appeals against Court orders. (1) Notwithstanding anything contained in any other law, an appeal against any order, decision or judgment of the Court under this Ordinance shall lie to the Supreme Court where the company ordered to be wound up has a paid-up share capital of not less than one million rupees; and, where the company ordered to be wound up has a paid-up capital of less than one million rupees, or has no share capital, such appeal shall lie only if the Supreme Court grants leave to appeal.
(2) Save as provided in sub-section (1), an appeal from any order made or decision given by the Court shall lie in the same manner in which and subject to the same conditions under which appeals lie from any order or decision of the Court.
(3) An appeal preferred under sub-section (2) shall be finally disposed of by the Court hearing the appeal within ninety days of the submission of the appeal."
6. A close perusal of the section aforesaid would indicate, under sub-section (1) thereof, that whether the company ordered to be wound up has a paid-up capital of not less than one million rupees, or whether it is less than one million rupees, the resort shall have to be made to the Supreme Court with the only difference that in the former case it would be a direct appeal and in the later case it would be a petition for leave to appeal. The order of winding up is included in sub- section (1) of the section. Any other order that does not fall within the ambit of sub-section (1), would be considered under Sub-section (2) thereof and appeal against such order would lie in the same manner in which and subject to the same conditions under which appeals lie from any order or decision of the Court. This refers to all orders passed in exercise of original civil jurisdiction of a High Court which under Section 15 of Code of Civil Procedure (Amendment) Ordinance 1980, would be appealable before a Division Bench of a High Court. To simplify, the orders falling within the ambit of Section 10(1) of the Ordinance are appealable before the Supreme Court while all other orders under Section 10(2) of the Ordinance are challengeable through an Intra Court Appeal.
7. Learned counsel for the respondents was of the view that all orders passed either before or after the winding up order, shall be appealable before a Division Bench of the same High Court excluding the order of the winding up. While, on the other hand, learned counsel for the petitioners maintained that before winding up, all orders passed by a Company Bench would be appealable before a Division Bench of the same High Court but after once the winding up order has been passed, all orders thereafter shall fall under Section 10(1) of the Ordinance and appeal or petition, as the case may be, shall lie before the Supreme Court.
8. During arguments the case of Mehboob Industries v. P.I.C.LC.' (1988 CLC 866) was relied upon but it is not relevant because the dispute therein pertained to Sections 162 and 165 of the Companies Ordinance where the matter of winding up was not under consideration. Brother Steel Mills Limited v. Mian Ryas Meraj (PLD 1996 SC 543), a larger bench judgment of this Court is also referred to but that too pertained to the investigation of companies affairs before the winding up proceedings and hence this authority also has not specifically entertained and answered the controversy involved before us. Same is the case of Diamond Industries (PLD 2003 SC 124) where the dispute pertained to a period before winding up, involving Section 265 of the Companies Ordinance, 1984 concerning the appointment or otherwise of an Inspector to investigate the affairs of the company.
9. A casual reading of Section 10(1) of Ordinance 1984 gives an impression that it pertains to the order of winding up alone which is appealable before the Supreme Court. Had it been the intention of legislature, it could have conveniently used singular term of winding up, to the effect that, any judgment whereby the company is ordered to be wound up, shall be appealable before the Supreme Court in the manner and under the conditions already described. Contrary to the use of single term, the use of multiples like "order", "decision" or "judgment" certainly covers a wider ambit and point to a scenario where different types of orders, not necessarily of winding up, might be challenged in appeal.
10.Another important characteristic of this sub-section is the use of words "where the company ordered to be wound up". These terms visualize the passage of any "order" or "decision" passed or made at a time when the company has already been wound up. Had the legislature an intention to make a mere reference to an order or decision passed or made during the pendency of a winding up proceedings, it could have used the words "where the company is sought to be wound up" instead of the words "where the company is ordered to be wound up". So it includes any order passed after the winding up order. The wisdom is apparent because after the winding up order, the legislature did not seem to have intended to prolong the matters by allowing an intermediary remedy of Intra Court Appeal.
11.We would therefore conclude and hold that Section 10(1) includes the winding up order as well as any order or decision in proceedings where the company has already been ordered to be wound up. Any order passed or decision made by Company Judge after the winding up of company, shall be appealable before the Supreme Court in the manner and under the conditions described in the sub-section itself. As the impugned order is passed after winding up proceedings, the petition before this Court, is maintainable.
12.This Court in case of S. Muhammad Din and Sons (1992 SCMR 1795) has held that appeal under Section 10, is competent only where an order or decision has been made in proceedings when the company has already been ordered to be wound up. The terms to be appreciated are, any `proceedings' when the company has "already been ordered to be wound up". It gives a clear indication that once a company has already been ordered to be wound up, any order passed or decision made in proceedings thereafter can be challenged before the Supreme Court under.
Section 10(1) of Ordinance, 1984. Though not referred to yet the principle aforesaid was followed by Sindh High Court in Muhammad Farooq's case (PLD 1999 Karachi 246) holding a. view that once a winding up order has been passed, all orders passed in proceedings thereafter shall fall under Section 10(1) of the Ordinance and be appealable before the Supreme Court..
13.Coming to the merits of the case, it is apparent on the face of record that, by the time Reference # 2 of 2005 was prepared and made by the Official Assignee, the highest bid till such time was of the petitioners and it was on or up to .21.3.2005. It came up before Court on 4.4.2005 when the expectation of still higher bid was expressed. The order was made to make a fresh Reference, to be heard alongwith Reference # 2 of 2005, on 11.4.2005.
14.Before the above date of hearing, the objection were filed and early hearing was ought.
Instead of shortening the period of hearing from 11.4.2005, the Court ordered the hearing of all The pending references, applications and objections, now for 3.5.2005. As against its own fixation aforementioned, it suddenly, on 18.4.2005, an intervening date, took up the hearing of Reference # 3 of 2005, Passed the impugned order altogether ignoring Reference # 2 of 2005, which through the said order was again left at the mercy of Official Assignee despite the fact that it was already submitted by The latter for approval or otherwise, by the Court. It was definitely at the back of the bidders declared highest in Reference # 2 of 2005. The order violating the basic principles of natural justice, is not sustainable in law.
15.Consequently, the petition after conversion into appeal is accepted, the impugned order dated 18.4.2005 is set aside and the case is remanded to the learned Company Bench of the Sindh High Court with direction to decide Reference # 2 of 2005 and Reference No, 3 of 2005 alongwith all the objections and applications of the parties, after hearing all the parties concerned, keeping in view, the larger interest, in accordance with law, of the Company under liquidation as well as the creditors. The Court shall decide the matter within 15 days from the receipt of this order.