Jai Agarwal vs Liquidator Satyendra Prasad Khorania & ...

(Arising against the impugned order dated 06.10.2023 passed by the Hon'ble National Company Law Tribunal, Jaipur Bench in I.A No. 522/JPR/2023 in CP (IB) No. 205/7/JPR/2019)

IN THE MATTER OF:

Jai Agarwal, S/o Shri Manoj Agarwal, Resident of Purana Bazar, Fatehnagar, ...Appellant District Udaipur (Rajasthan).

Versus

Satyendra Prasad Khorania, Liquidator of M/s Atlas Alloy (India) Private Limited, R/o 402, OK Plus, D.P. Metro, Opposite Metro Pillar No. 94, New Sanganer Road, ...Respondent No. 1 Jaipur (Rajasthan).

Punjab National Bank through its Branch Manager, Beawar Branch, situated at 482C-RF4, Diggi Mohalla, ...Respondent No. 2 Bea war, Rajasthan.

Novelty Textiles, through Proprietor Mohammad Sharif Registered Address: 1, Opp. Mamta Transport Company, Ajmer Road, Beawar, (Rajasthan). ...Respondent No. 3 Email ID: empkhalid@rediffmail.com

Present: For Appellant: Mr. Avin Chhangani, Advocate. For Respondents: Mr. Naresh Kumar Sejvani, Advocate for R-3. Mr. Amol Vyas, Liquidator. Mr. Ankit Raj, Mr. Mohammed Khan, Advocates for R-2.

Cont'd..../ -2-

J U D G M EN T (2nd September, 2025)

INDEVAR PANDEY, MEMBER (T)

This appeal has been filed by the Mr. Jai Agarwal/Appellant, under

Section 61 of the Insolvency and Bankruptcy Code, 2016, being aggrieved by

the impugned order dated 06.10.2023 passed by the Hon'ble National

Company Law Tribunal, Jaipur Bench (Adjudicating Authority) in IA No.

522/JPR/2023 in CP (IB) No. 205/7/JPR/2019. The Appellant is an

unsuccessful bidder in the e-auction of assets of M/s Atlas Alloy (India)

Private Limited/ Corporate Debtor, which was under liquidation. Alleging

irregularities, collusion, and unfair conduct on the part of the Liquidator Mr.

Satyendra Prasad Khorania/ Respondent No. 1, in the conduct of the e-

auction dated 06.09.2023, the Appellant approached the Adjudicating

Authority seeking to set aside the auction. However, the Adjudicating

Authority dismissed his application vide the impugned order. The Appellant

has now approached this Appellate Tribunal against the impugned order.

Brief Facts of the Case

2. The brief facts of the case are as given below:

i. The Appellant, Jai Agarwal, is a young businessman, who participated in

the auction proceedings of a property belonging to M/s Atlas Alloy (India)

Private Limited/ Corporate Debtor (CD) under liquidation. Mr. Satyendra

Prasad Khorania/ Respondent No.1 was appointed the Liquidator of the

CD by the Adjudicating Authority upon initiation of liquidation

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proceedings. The Punjab National Bank/ Respondent No.2 here is the

financial creditor, which had instituted proceedings under Section 7 of

the Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as

'Code') against the Corporate Debtor, which ultimately led to the

liquidation order.

ii. The Liquidator issued a public announcement dated 11.08.2023 stating

that an e-auction would be conducted on 06.09.2023 for the sale of assets

of the Corporate Debtor. The property to be sold was specified as land and

building (including shed) situated at Plot Nos. G-78, G-79 and part of G-

80, Industrial Area, Beawar, Rajasthan, measuring about 2990 sq. mts.,

on "as is where is and whatsoever is available basis."

iii. The e-auction process document and terms and conditions were made

available on the designated website on 14.08.2023 (The auction was being

conducted online through the portal ncltauction.auctiontiger.net). The

document laid down the complete schedule for the auction, including

opening of the auction portal, site visits on 29.08.2023; last date for

submission of eligibility documents on 29.08.2023; last date for

submission of EMD and bid forms on 04.09.2023; the e-auction on

06.09.2023; and announcement of successful bidder on 07.09.2023.

iv. As per the prescribed process, the Appellant submitted his bid documents

along with the requisite earnest money deposit (EMD) to participate in the

auction.

v. The Appellant's father, Shri Manoj Agarwal, went to the Liquidator's office

on 06.09.2023, the date of the auction for placing the bid on behalf of the

Appellant as he was not very comfortable in use of IT systems. He sought

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the assistance of Liquidator in placement of bids. The Appellant initially

placed his first bid of Rs. 1,56,05,000/- at the commencement of the

auction. The Appellant revised his bid upward by Rs.25,000/-, and at

around 12:10 PM, the bid stood at Rs. 1,56,30,000/-. The Appellant

remained the sole bidder almost during the entire period of the auction,

until the last few minutes before the scheduled deadline of 3:00 PM.

vi. Just before the close of bidding, a new second bid suddenly reflected on

the auction portal, pushing the Appellant to the second position. The

auction thereafter closed, and the newly bidder was declared as highest

bidder (H-1) at Rs. 1,56,55,000/-, only marginally above the Appellant's

last bid.

vii. On 08.09.2023, the Appellant sent an e-mail to the Liquidator raising

objections regarding the irregularities and malpractices in the conduct of

the auction. The Liquidator, however, gave only a cryptic reply, without

addressing the allegations in substance.

viii. Subsequently, the Appellant filed IA No. 522/JPR/2023 before the NCLT,

Jaipur, under Section 60(5) of the IBC, praying for quashing of the e-

auction dated 06.09.2023; confirmation of the Appellant's bid; or in the

alternative, re-auction of the assets.

ix. The said application was heard by the Adjudicating Authority on

22.09.2023, when arguments were advanced by both sides. However, the

Liquidator did not file a detailed reply to the Appellant's pleadings, but

admitted that the Appellant's representative had visited his office on the

date of auction and that his computer was used for handling the

Appellant's bid account.

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x. The Adjudicating Authority, however, by its order dated 06.10.2023,

dismissed the application of the Appellant. It held that the auction had

been conducted as per the process document and that the Appellant had

the opportunity to revise his bid but failed to do so within the stipulated

time.

xi. The Appellant, feeling aggrieved by the aforesaid order, initially filed a writ

petition before the Hon'ble Rajasthan High Court, but subsequently

withdrew it on 13.10.2023 to pursue the present statutory appeal before

this Tribunal.

xii. During the intervening period the Liquidator issued the letter of intent to

the Successful bidder Novelty Textiles/ Respondent No.3 on 06.09.2023

with a direction to pay the balance amount of Ernest Money Deposit i.e.

Rs. 23,53,250/- within 24 hrs and the balance amount of auction within

30 days i.e. by 06.10.2023 as per the provisions of the Code and

Regulations thereto.

xiii. The Respondent No.3 made the requisite payments within the schedule

period and thereafter the sale deed for the property was registered on

17.10.2023.

xiv. The appellant has sought quashing of the e-auction dated 06.09.2023;

setting aside of the NCLT's order dated 06.10.2023; and a direction either

to confirm the Appellant's bid or to conduct a fresh transparent auction

in the interest of justice.

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Submissions of the Appellant:

3. Learned counsel for the Appellant submits that the impugned order

suffers from grave infirmities and has failed to appreciate the manifest

illegalities committed by the Respondent-Liquidator in conducting the e-

auction. The Appellant, who was the sole genuine participant throughout the

e-auction period from 12:00 p.m. till almost the end of auction period, has

been wrongfully deprived of his rightful claim. Counsel points out that the

main object of liquidation under the Insolvency and Bankruptcy Code, 2016

(IBC) is maximization of value, but in the instant case, the Liquidator, acting

in collusion with another party, introduced an unauthorized bidder at the

eleventh hour in a non-transparent manner, thereby completely vitiating the

sanctity of the process. Such conduct not only violates the letter and spirit of

the IBC but also undermines public confidence in the liquidation mechanism.

4. Learned counsel submits that the sequence of events prior to and

during the auction clearly reveal mala fide conduct on the part of Liquidator.

On 11.08.2023, a public announcement was issued stating that an e-auction

would be conducted on 06.09.2023. On 05.09.2023, one day prior to the

auction, the Respondent-Liquidator personally contacted the Appellant and

his father, Shri Manoj Agarwal, and informed them that since the Appellant

was the sole bidder, all formalities would be completed swiftly, if the Appellant

or his representative attended the office of the Liquidator on the date of the

auction. Acting on this assurance, the Appellant's father attended the

Liquidator's office. However, despite this assurance, during the course of the

auction held on 06.09.2023 through the official portal

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ncltaucti.auctiontiger.net, the Appellant continued to remain the only bidder

till just before 3:00 p.m., revising his bid in increments of Rs. 25,000/- at the

instance of the Liquidator and his staff. In the last few minutes, suddenly and

without any prior intimation, another bid surfaced on the portal, creating

serious suspicion of collusion and manipulation. Screenshots of the auction

portal, placed on record, clearly demonstrate that the Appellant remained the

only participant for the entire duration, until the questionable last-minute

intervention.

5. Ld. counsel further submits that the Appellant promptly raised his

grievances by way of an email dated 08.09.2023 to the Liquidator, protesting

against the illegality and unfairness of the process. Instead of addressing the

grievance transparently, the Liquidator furnished only a cryptic reply and

deliberately avoided giving any satisfactory explanation, as to how another bid

could suddenly appear at the last minute. Left with no option, the Appellant

filed I.A. No. 522/JPR/2023 before the Learned Adjudicating Authority,

praying for setting aside the tainted e-auction and seeking either confirmation

of his bid or in the alternative, a direction for re-auction of the assets. The

Appellant's I.A. was supported by documentary evidence, including

screenshots, bid documents, and correspondence, all of which clearly

demonstrated foul play by the Liquidator. Yet, the Adjudicating Authority

dismissed the I.A. without properly appreciating this evidence. Learned

Counsel submitted that the Liquidator did not even file a formal reply to

controvert the Appellant's affidavit-supported pleadings in the said I.A.,

thereby admitting by silence the Appellant's allegations of impropriety.

Company Appeal (AT) (Ins.) No. 30 of 2024 -8-

6. Ld. counsel also pointed out that during oral arguments before the

NCLT on 22.09.2023, as well as in his written submissions, the Respondent-

Liquidator admitted that the Appellant's father had indeed visited his office

on the date of the auction and that the Liquidator's own computer was used

for handling the Appellant's bid. This extraordinary admission is fatal to the

legality of the process. No provision of the IBC, Regulations, or auction terms

empowers a Liquidator to permit his own computer system to be used by a

bidder, as it compromises both confidentiality and transparency. Such a

course of action itself renders the auction process unsustainable. Moreover,

the introduction of another bidder at the last minute, without disclosure or

verification, is a gross illegality that makes the process void ab initio. The

Respondent's failure to adhere to statutory duties of fairness, transparency,

and value maximization demonstrates not only dereliction but also possible

collusion with the so-called H1 bidder, thereby subverting the very purpose

of liquidation.

7. Learned counsel finally submits that the impugned order of the

Adjudicating Authority, dated 06.10.2023, has resulted in grave miscarriage

of justice. Instead of protecting the sanctity of the liquidation framework

under the IBC, the NCLT has erroneously upheld a process tainted with

illegality and collusion. The Appellant has approached this Appellate Tribunal

in good faith, not only to safeguard his own rights as a bona fide bidder, but

also to ensure that liquidation processes across the country remain

transparent and above suspicion.

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8. Summing up his arguments, Ld. Counsel has prayed that this Appellate

Tribunal be pleased to (i) quash and set aside the e-auction dated 06.09.2023,

(ii) confirm the Appellant's bid as the rightful successful bid, or in the

alternative, (iii) direct the conduct of a fresh re-auction under the supervision

of this Tribunal. Such relief is necessary to ensure justice, prevent abuse of

process, and restore confidence in the liquidation mechanism envisaged

under the IBC.

Submissions on behalf of Respondent No. 1 - Liquidator

9. Learned counsel for the Respondent No.1/Liquidator submits that it is

the Appellant's case that he was the only bidder on 06.09.2023 at 3:00 PM,

and that the Liquidator wrongfully introduced another bidder. Learned

counsel submits that this contention is completely false and dehors the

record. Another bidder, namely M/s Novelty Textiles, had duly deposited the

Earnest Money (EMD) on 04.09.2023, well before the date of auction. This

deposit stands verified from the bank statements, which were annexed along

with the progress report filed by the Liquidator before the Ld. NCLT.

Hence, the claim of the Appellant being the sole bidder is a concocted

assertion, and the Appeal is founded on a false premise.

10. Learned Counsel further submits that the allegations that the

Liquidator acted contrary to the Code of Conduct are baseless and devoid of

merit. The entire Appeal is nothing, but a compilation of false statements by

the Appellant. The Appellant has alleged that he logged into the bidding

account from Udaipur at 2:59 PM, having been in the Liquidator's office

shortly prior thereto. However, Page 92 of the Appeal Paper Book clearly

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demonstrates that the Appellant had in fact logged into the e-auction platform

from his own computer at 12:54 PM, much earlier in the day. Further, Page

53 of the Appeal Paper Book shows that the Appellant actually logged in at

2:57 PM and remained logged in until 3:06 PM. Thus, the allegation of logging

in at 2:59 PM is false, and the entire narrative advanced by the Appellant

stands demolished by documents submitted by him.

11. Further, Learned Counsel submits that the screen shots of auction page

placed on Pages 78, 80 and 82 of the Appeal Paper Book reveal the true

conduct of the Appellant. At these stages of the auction, the Appellant still

had sufficient time to revise his bid, but instead of placing higher bids, he

deliberately took screenshots of his own computer screen to fabricate a case.

It can be seen from the screen shot of the web page attached as Page 78, that

he had several seconds remaining to revise his bid, but he chose not to do so.

Similarly, screen shot on Page 80, once again shows that he had available

time still he did not increase his bid and only took another screenshot. Lastly,

it is seen from the screen shot on Page 82 that even with 10 seconds

remaining, the Appellant repeated the same conduct. This pattern shows mala

fide conduct on the part of the Appellant, who participated in the process, not

with the intention of acquiring the assets of the Corporate Debtor, but to

create self-serving records for future litigation.

12. Ld. counsel further points out that the screen shot on Page 96 of the

Appeal Paper Book conclusively demonstrates the Appellant's dishonest

conduct. At that stage, the Appellant had 27 seconds left to revise his bid, but

he intentionally entered an incorrect amount of Rs. 1,56,30,000/-, whereas

Company Appeal (AT) (Ins.) No. 30 of 2024 -11-

the system itself reflected that the next valid bid, could only have been Rs.

1,56,80,000/-. This shows that the Appellant had no intention to maximize

the value of the assets of the Corporate Debtor, but instead deliberately placed

a wrong bid so as to later claim irregularity in the auction. The mala-fide

conduct of the Appellant is thus writ large and stands established from his

own documents.

13. Summing up his arguments, Ld. Counsel stated that the only purpose

of the present Appeal is to blackmail and malign the Liquidator. The Appellant

never intended to participate bona fide in the auction, but entered the process

only to obstruct liquidation and drag the Liquidator into vexatious litigation.

Such conduct deserves to be deprecated. Ld. Counsel submitted that the

Appeal, being frivolous and malicious, be dismissed with exemplary costs in

order to curb such mischievous attempts to derail the liquidation process and

tarnish the reputation of the Liquidator, who has acted strictly in accordance

with law.

Submissions on behalf of Respondent No. 3/ Successful bidder

14. Learned counsel for Novelty Textiles, the Successful Bidder in the

auction and Respondent No. 3 submits that the answering respondent duly

participated in the e-auction conducted by the Liquidator in respect of Plot

No. G-78, G-79 and part of Plot No. G-80, Industrial Area, Beawar,

admeasuring in total 2990 sq. meters. In accordance with the prescribed

terms and conditions of the auction, the answering respondent deposited 10%

of the Earnest Money Deposit (EMD), being an amount of Rs. 15,60,500/-,

with the Liquidator on 04.09.2023. This payment was made through RTGS

Company Appeal (AT) (Ins.) No. 30 of 2024 -12-

and duly acknowledged by the Liquidator. It is thus clear that the answering

respondent was an eligible participant, who complied with all pre-auction

requirements in time and in the manner mandated.

15. Learned counsel further submits that during the course of the e-auction

held on 06.09.2023, he placed an initial bid of Rs. 1,56,05,000/-. Thereafter,

another bidder placed a bid of Rs. 1,56,30,000/-, to which he responded by

placing a higher bid of Rs. 1,56,55,000/-. Beyond this stage, no further bids

were placed by the Appellant or any other participant. Consequently, their bid

came out as the highest bid. Accordingly, the Liquidator issued a Letter of

Intent in his favour directing deposit of the balance amount within the

prescribed period of 30 days. It is pertinent to note that the fact of the

answering respondent being declared as the highest bidder stands established

from the very documents filed along with the appeal itself. The allegation of

the Appellant that he was prevented from placing a higher bid is wholly

misconceived, for the record clearly shows that the system displayed the next

possible bid as Rs. 1,56,80,000/-, yet the Appellant deliberately refrained

from entering such a bid. His claim that he was unable to do so is therefore a

concocted story, liable to be rejected outright.

16. Learned counsel next submits that pursuant to the Letter of Intent, the

answering respondent was directed by the Liquidator to deposit 25% of the

bid amount within 24 hours. Complying with the said requirement, the

answering respondent deposited a sum of Rs. 23,53,250/- on 06.09.2023.

Subsequently, the answering respondent also deposited the balance

consideration amount well within the stipulated period prescribed by the

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Liquidator. Upon full payment, the answering respondent requested execution

of the sale deed in its favour. The entire sequence of payments made by the

answering respondent has been tabulated and forms part of the reply,

establishing compliance with every demand raised. Thereafter, the Liquidator

executed a Sale Deed dated 13.10.2023, which was duly registered on

17.10.2023 in favour of the answering respondent. A copy of the registered

Sale Deed has been enclosed as Annexure R/2 of his reply. Thus, the auction

process stood lawfully concluded in favour of the answering respondent.

17. Learned counsel further submits that after registration of the sale deed,

possession of the property was handed over to the answering respondent, who

thereafter established a workshop on the premises for its business activities.

The answering respondent commenced manufacturing material relating to

tent house products and has made substantial investments on the said

property in good faith, with the legitimate expectation of deriving returns.

However, due to the interim orders passed by this Appellate Tribunal, the

answering respondent has been unable to secure financial facilities from

banks or institutions, thereby severely affecting smooth running of its

business. This has caused serious financial prejudice to the answering

respondent who, despite being a bona fide auction purchaser, is suffering due

to frivolous litigation. Photographs evidencing the workshop established on

the premises have been placed on record and marked as Annexure R/3 of his

reply.

Company Appeal (AT) (Ins.) No. 30 of 2024 -14-

18. Learned counsel finally submits that from the above sequence of events,

it is clear beyond doubt that the Appellant never genuinely participated in the

auction with the bona fide intention of purchasing the property. His conduct

throughout demonstrates an attempt to disrupt the process, rather than to

enhance value. The Appeal is nothing but a mala fide attempt to derail the

liquidation process after the auction has been successfully completed, full

consideration paid, and sale deed registered in favour of the answering

respondent. The answering respondent has already invested heavily in

reliance upon the concluded sale, and further delay would cause irreparable

harm. Ld. Counsel therefore prayed that the present Appeal may be dismissed

with exemplary costs in order to prevent abuse of the judicial process and to

protect the sanctity of auctions conducted under the Insolvency and

Bankruptcy Code.

Analysis and findings

19. We have gone through the documents on record and heard the Ld.

Counsels for the parties at great length. Respondent No.2 - Punjab National

Bank has not filed its reply and has supported the contentions of Respondent

No.1/Liquidator and Respondent No.3/ the Successful Bidder.

20. The core issue which falls for our determination is whether the e-

auction conducted on 06.09.2023 by the Liquidator in the liquidation of Atlas

Alloy (India) Pvt. Ltd. was vitiated by fraud, collusion, or material irregularity

in such a manner, as to render the auction void.

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21. The Auctions in liquidation proceedings are not mere private

transactions; they are mechanisms designed under the Code to ensure

transparency, fairness, and maximisation of value for the creditors and

stakeholders of the corporate debtor. If allegations of manipulation are found

correct, then the auction itself collapses, defeating the very purpose of

liquidation. However, if such allegations are speculative or unsupported,

interference with a concluded auction would unsettle the certainty of

liquidation, delay distribution to creditors, and encourage frivolous litigation.

With this balance in mind, we proceed to analyse the rival contentions and

the documents on record.

22. The Appellant's first allegation is that he was the sole bidder on the

platform until about 3:00 p.m., when suddenly another participant was

introduced by the Liquidator in collusion with external parties. We examine

this contention against the documentary record. The Liquidator has produced

proof that the other bidder, viz. Novelty Textiles, deposited the earnest money

deposit (EMD) on 04.09.2023, two days prior to the auction. The bank entry

confirming such deposit and the portal's acknowledgment of registration have

been filed. The extract from Bank statement of the CD has been extracted

below for reference:

Company Appeal (AT) (Ins.) No. 30 of 2024 -16-

23. We can see from the entry dated 04.09.2023 that Mr. Abdul Khalid had

transferred an amount of Rs. 15,60,500/- in the account of CD. It is the

submission of Liquidator and Respondent No.3 that the aforesaid amount was

paid on behalf of 2nd bidder Novelty Textiles and is the exact amount of EMD.

It is seen from the affidavit filed by the Liquidator that the Successful Bidder

viz. Novelty Textiles had submitted its documents to the Liquidator on

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29.08.2023 and thereafter they deposited the EMD of Rs.15,60,500/- on

04.09.2023. These details including the bank statement of the CD were

submitted to Adjudicating Authority in one of the progress reports of

Liquidation of the CD filed by the Liquidator. This clearly demonstrates that

the second bidder viz. Novelty Textiles was validly registered for e-auction and

was eligible as per the terms and conditions of the e-auction. Thus, the

contention of the Appellant that a new bidder was introduced suddenly at the

last moment is factually incorrect and unsustainable.

24. The second allegation is that while the Appellant was bidding from his

computer, his father was present in the office of the Liquidator and witnessed

the Liquidator interfering with or attempting to control his login credentials.

25. In this regard, we have seen the submission of the Appellant before the

Adjudicating Authority. In para 6 of the said application filed in I.A. No.

522/JPR/2023 the appellant has stated that he was the sole bidder for the

entire bidding period i.e. from 12.00 p.m. to 3.00 p.m. and in support of the

same he had relied upon photographs/ screen shots of the e-auction portal.

The aforesaid paragraph 6 is extracted below:

"6. That the said auction was being conducted through the

portal - ncltauction.auctiontiger.net. That during the E-auction

process on 06.09.2023 the applicant was the sole bidder

almost entirely until the deadline i.e. 3 P.M. This is evidenced

by the photographs/screenshots of the e-auction process,

which reflect the fact that the applicant was the sole bidder for

almost the entire duration of the e-auction i.e. 12 p.m. to 3 p.m.

on 06.09.2023. The applicant's first bid, when the e-auction

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commenced was Rs. 1,56,05,000/-. The said bid of the

applicant came to be revised, in increments of Rs. 25,000/-, at

the insistence of the Respondent Liquidator and his staff"

26. The Adjudicating Authority in para 5 of the impugned order gave the

following findings:

"5. The Applicant had used his log-in credentials from his

computer on 04.09.2023 and the day of bidding 06.09.2023;

firstly, at 12:00 PM; secondly, at 12:19 PM; and lastly, at 02:57

PM. The screenshots relied on by the Applicant have a label of

his email box opened and a photo to prove that the Applicant

was present in the bidding terminal and during this process,

no contact or intervention by Liquidator has been complained

by the Applicant."

27. It is clear from the admission of the appellant and the findings of the

AA that appellant has logged in at serval times during the auction period. This

login was in addition to login from the Liquidators office when the first bid

was placed by the appellant father. These logs show that the Appellant logged

into the portal at 12:54 p.m. on 06.09.2023 and remained continuously

logged in until 3:06 p.m., after the auction had concluded. The same logs have

been produced and are extracted below for reference:

Company Appeal (AT) (Ins.) No. 30 of 2024 -19-

Company Appeal (AT) (Ins.) No. 30 of 2024 -20-

28. These technical records conclusively establish that the Appellant's login

was active from his own computer system and not from any external source.

Company Appeal (AT) (Ins.) No. 30 of 2024 -21-

The mere fact that his father was physically present in the Liquidator's office

does not translate into evidence that the Liquidator accessed or interfered

with the Appellant's portal credentials. No contemporaneous complaint was

made in this regard either. Hence, this allegation is without foundation.

29. The third allegation is that the Liquidator demanded illegal gratification

from the Appellant's father to allow the Appellant to succeed in the auction.

There is no material on record to sustain this allegation. No complaint been

lodged with the Insolvency and Bankruptcy Board of India (IBBI) against the

Liquidator, nor any police complaint been filed against the Liquidator. These

are mere allegations without an iota of proof. The allegation remains a bare

plea unsupported by proof. In law, fraud or corruption must be specifically

pleaded and strictly proved. Suspicion or a bald allegation cannot be the basis

to set aside an otherwise valid auction. We therefore reject this contention.

30. The fourth allegation is that the Appellant was ready and willing to offer

a much higher bid, but was deprived of the opportunity because of the

Liquidator's collusion and interference. On this, the Appellant has placed

reliance on screenshots he captured during the auction. Ironically, it is these

very screenshots which disprove his case. A screenshot taken at 2:59:34 p.m.

shows that the highest bid at that point was Rs.1,56,55,000/- that the next

valid bid amount displayed by the system was Rs.1,56,80,000/- and that the

Appellant was placed at "Rank 2". The same has been extracted below for

reference:

Company Appeal (AT) (Ins.) No. 30 of 2024 -22-

Company Appeal (AT) (Ins.) No. 30 of 2024 -23-

31. Despite this clear knowledge of the amount required to outbid the rival

bidder, the Appellant chose to enter an invalid figure of Rs.1,56,30,000/- The

system, programmed to reject invalid bids, did so. Instead of rectifying his

error and placing the correct next bid of Rs.1,56,80,000/- the Appellant

continued to take screenshots at 14:59:45 hrs and even with 10 seconds

remaining. The subsequent screen shot which has been taken at 15:01:12 hrs

reflects the situation after the auction has been closed. At this time also the

bid of Rs. 1,56,30,000/- entered by the appellant is reflected in the system

even after completion of auction. This screen shot also clearly shows that the

appellants rank was No. 2 and the next possible bid had to be

Rs.1,56,80,000/- or higher. These subsequent screenshots, show that the

system continued to display the next valid bid, yet the Appellant did not act

and retained his earlier bid of Rs. 1,56,30,000/-. His failure was therefore not

due to denial of opportunity, but arose from his own lapse or unwillingness

to bid higher.

32. We have also looked at the safeguard features of the auction itself. The

auction was conducted on ncltauction.auctiontiger.net, an independent e-

auction platform. The auction was configured with an automatic extension

facility, whereby if a valid bid was placed close to the closing time, the auction

would automatically extend by five minutes to ensure that no bidder lost out

due to time constraints. This feature existed in the present auction, thereby

ensuring fairness. The Appellant having been logged in throughout this

period, could have availed of the time extension facility by placing a valid

higher bid even at the last second which option he failed to exercise. His

Company Appeal (AT) (Ins.) No. 30 of 2024 -24-

grievance of being deprived of the opportunity is therefore clearly

unsustainable.

33. Another argument advanced by the Appellant is that the Liquidator

acted in collusion with the rival bidder to depress the bidding and thereby

harm the stakeholders. We find no material on record to support this

assertion. On the contrary, the rival bidder's participation was based on a

valid EMD deposit made two days earlier. The bidding amounts are clearly

reflected in the system logs and screenshots. No irregularity has been

demonstrated either in the sequence of bids or in the manner of their

acceptance by the platform. The process remained transparent throughout,

as reflected in the very documents produced by the Appellant.

34. The material on record clearly demonstrates that the auction was

conducted fairly and transparently; that the rival bidder was validly

registered; that the Appellant was continuously logged in during the entire

period and was fully aware of the bidding position; that he failed to place a

valid higher bid despite opportunity; and that the allegations of manipulation

or bribery are wholly unsupported by material on record. The prejudice

claimed by the Appellant is thus self-created and cannot be attributed to any

act of the Liquidator or the auction platform.

35. In light of the foregoing discussion, we are satisfied that the e-auction

conducted on 06.09.2023 was fair, transparent, and in accordance with law.

No fraud, collusion, or material irregularity has been established. The

Appellant's allegations not only lack evidentiary support, but are contradicted

Company Appeal (AT) (Ins.) No. 30 of 2024 -25-

by his own documents. His failure to secure the asset is a result of his own

inaction and not because of any lapse on the part of the Liquidator.

36. Accordingly, we find no infirmity in the orders of Ld. NCLT, Jaipur

Bench dated 06.10.2023, which has been passed considering all relevant

facts; and applying the settled principles of law. The impugned order is sound,

reasoned, and free from any infirmity.

37. Accordingly, we find no merit in the present appeal. The same is

dismissed. There shall be no order as to costs.

[Justice Yogesh Khanna] Member (Judicial)

[Mr. Indevar Pandey] Member (Technical)

SA/Pragya (LRA)

Company Appeal (AT) (Ins.) No. 30 of 2024