The Bombay high court on Friday upheld 2011 order by a single bench that refused a stay on the winding up of Swadeshi Mills spread across 48 acres.
As a result of the order pronounced by a division bench comprising Justice Dhananjaya Chandrachud and S.C. Gupte, the mill land will be sold by public auction through the official liquidator of the court, after which the dues of the secured creditors and workers will be paid with any balance being disbursed to the shareholders.
Forbes and Co. and Grand View Estates from the Shapoorji Pallonji Group had moved the HC division bench against the single bench order, seeking revival of the company after taking it out of liquidation and carrying out real estate development instead of textile activities.
In 2011, Shahpoorji Pallonji Group, which holds 52 per cent stake in the Mills through two subsidiaries, had moved the high court against its September 2005 order to wind up the defunct mill. In its plea, the real estate giant offered to make payments to the mills’ creditors, workers and employees. In return, they asked the HC to exercise its discretionary powers to give the group complete control over the assets and properties of the mill, and to discharge the official liquidator.
On November 14, 2011, S.C Dharmadhikari rejected the application stating, “If these lands are sold by the official liquidator under the supervision of this court and at a public auction, the applicants may not stand any chance and hence they desire to obtain the lands at a throwaway price by a back-door method. That is their sole intent in making the application.”