In Brief
IDBI Bank (formerly United Western Bank) sought execution of a sale deed for an office property offered by Kothari Orient Finance Limited (KOFL) as settlement of a defaulted loan. After KOFL's winding up petition was filed, the bank applied for execution of the sale deed. The High Court dismissed the application and revived winding up proceedings. The Supreme Court upheld both orders: winding up proceedings were correctly revived as unsatisfied secured creditors were deprived of proper notice due to non-advertisement of the petition. The sale deed application was rightly rejected because the transaction required approval from KOFL's general meeting (not mere Board resolution) under Section 293(1), and was never obtained. Although the agreement did not constitute fraudulent preference, execution could not be granted.
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