GOPALA GOWDA, J. ( 1 ) THE appellant has called in question the order made by the company Court in CA. 830/03 in Co. P. 62/87, dated 13-11-2003. By the impugned order the learned single Judge has confirmed the sale of certain assets of the Company under liquidation in favour of Second respondent/auction-purchaser and directed the Official Liquidator to hand over possession of certain assets of the Company and take consequential steps to confer title in favour of Second respondent/auction-purchaser. Consequently, applications filed by the applicant as also the representatives of the employees' union not to confirm the sale were rejected by the learned Judge of the Company Court. The brief facts of the case are as follows : ( 2 ) ON 2-6-2000, this Court passed an order directing winding up of the Company viz. M/s. Sree Srinivasa Spun Silk (India) Ltd. situate at Bandarmanahalli, Chickballapur taluk, Kolar District. The Official Liquidator attached to this Court was directed to take over the assets of Company under liquidation. By the order dated 25-9-2002 this Court permitted the official Liquidator to sell assets of the Company in terms of the said order. According to the valuation report the assets of the Company was valued at Rs. 165. 13 lakhs. Thereafter the Official Liquidator got sale proclamation duly advertised in daily newspaper, viz. Economic Times and Prajavani. The II respondent herein offered the highest bid of Rs. 80. 45 lakhs. However the Court rejected the said offer and directed Official liquidator to advertise the sale afresh. ( 3 ) AGAIN it was advertised. During the second sale, the very purchaser viz. II-respondent offered a highest bid of Rs. 1,24,54,000/-and deposited 25% of the said sale consideration with the Official Liquidator. ( 4 ) ON 10-4-2003, the learned single Judge accepted the said offer and directed II respondent/auction-purchaser to deposit balance sale consideration within 30 days in terms of the notification. On the request of Second respondent/auction-purchaser permission was granted to Second respondent to have its own security services to protect the properties sold. Accordingly, Second respondent/auction purchaser engaged its own security services. In the meanwhile, C. A. 268/2003 was filed by one of Ex-Directors of Company under liquidation praying not to confirm the sale held on 6-3-2003 in favour of Second respondent. It was contended by the applicant that in the sale proclamation reserve price of Rs. 165. Accordingly, Second respondent/auction purchaser engaged its own security services. In the meanwhile, C. A. 268/2003 was filed by one of Ex-Directors of Company under liquidation praying not to confirm the sale held on 6-3-2003 in favour of Second respondent. It was contended by the applicant that in the sale proclamation reserve price of Rs. 165. 13 lakhs was not mentioned, there was no proper description of land and building; there was no separate description of plant and machinery; no particulars were given; there was no mention of face value of assets; the sale proclamation was published in economic Times in bombay and not in local newspapers; there was no sufficient time for the intending bidders to inspect the premises. ( 5 ) ON 30-5-2003 at the request of the learned Counsel appearing for Ex-Director-applicant one week time was granted by the learned single Judge to inspect the property to get better offer, if possible. The said request was renewed twice. On 3-7-2003 the application was heard as the applicant-Ex. Director could not bring better offer. After hearing the parties by a separate order dated 3-7-2003 the Company Court called upon II respondent to raise price offered by him to the reserve price. The II respondent accepted to raise the price from Rs. 12,45,400/- to Rs. 165. 13 lakhs (reserve price) provided he was given 60 days' time to deposit the amount. Accordingly the Company Court granted 60 days' time to II respondent to deposit remaining sum and also made it clear to applicant that before confirmation of sale in favour of ii respondent if a better offer is secured by the applicant the same would be considered at the time of confirmation of sale. The II respondent deposited balance amount within 60 days and moved Court for confirmation of the sale. ( 6 ) ON 10-10-2003 when the matter came up for confirmation of sale, the applicant/ex-Director wanted time for inspection of assets as the intending purchasers were not able to inspect the assets of the Company on 30-9-2003, since the entire area was covered by weeds and shrubs. This Court acceded to such request and granted further time to take intending purchasers to factory premises after removing the weeds and shrubs and a direction was given that inspection should be conducted on 15-10-2003. On 17-10-2003 the case was adjourned at the request of the applicant. This Court acceded to such request and granted further time to take intending purchasers to factory premises after removing the weeds and shrubs and a direction was given that inspection should be conducted on 15-10-2003. On 17-10-2003 the case was adjourned at the request of the applicant. The applicant went on pleading time to bring better offers which did not materialise till 22-10-2003. In the meanwhile, the appellant herein filed an application requesting the learned single Judge not to confirm the sale for the lower amount of Rs. 1. 65 crores and requested the Court to re-tender once again. The appellant was also granted sufficient opportunity to bring better offer for the assets of the Company under liquidation. However, neither the Ex. Director nor appellant was able to bring better offer; on the other hand, a submission was made by the appellant that the sale could be confirmed in favour of II respondent on the condition that on such purchase II respondent should re-employ all the ex-employees of Company under liquidation. ( 7 ) THE learned single Judge turned down the contention of the appellant that it is not open for the Court to put a condition on II respondent to absorb employees as a condition precedent for accepting the offer made by II respondent. The learned Judge has held that secured creditors who had actually participated in the sale proceedings with the Official Liquidator are of the opinion that the price offered by the II respondent is the highest offer and it is equivalent to the reserve price. The learned single Judge considering failure of Ex-Director to get better offer, confirmed the sale in favour of II respondent and directed the Official Liquidator to hand over possession of the assets of the company and to confer title on the Second respondent. Therefore, appellant is before this Court questioning the confirmation of sale order in favour of Second respondent urging various grounds to set aside the same. ( 8 ) WE have heard Sri Narayan Bhat, learned Counsel for the appellant, Sri Deepak, learned counsel for Official Liquidator and Sri g. Balakrishna Shastry, learned counsel appearing for II respondent. Therefore, appellant is before this Court questioning the confirmation of sale order in favour of Second respondent urging various grounds to set aside the same. ( 8 ) WE have heard Sri Narayan Bhat, learned Counsel for the appellant, Sri Deepak, learned counsel for Official Liquidator and Sri g. Balakrishna Shastry, learned counsel appearing for II respondent. ( 9 ) THE submissions made by learned counsel for appellant and grounds and additional grounds urged in this appeal may be summarized as follows : (i) The learned single Judge ought not to have confirmed the sale in favour of II respondent in the absence of application filed by II respondent for confirmation of sale. The learned single Judge has failed to notice that assets of the Company under liquidation are worth more than 750 lakhs. Thus the valuation furnished by official Liquidator appears to have been done without bringing the same to the notice of the Company Court. In this view of the matter, also the sale ought not to have been confirmed in favour of II respondent. The representation dated 8-9-2003 given by the appellant to the Official Liquidator to furnish the valuation report was not considered. The learned single Judge did not consider this fact though it was brought to the notice of the Court. (ii) The learned single Judge has failed to notice that operating agency of the Company had valued the fixed assets of the Company before BIFR as a sum of Rs. 750 lakhs. The learned single Judge has failed to notice that the machineries of the Company are imported; they are in good condition; however no reserve price was fixed in respect of these machineries. (iii) The Official Liquidator in the advertisement for sale did not give the full and correct description of properties to attract the intending purchasers. No reserve price was mentioned in the public notice which was published in the newspapers. The public notice was advertised by publishing in the Economic Times from bombay and Praja Vani from Bangalore, which would demonstrate that there was no enough publicity in the State of Karnataka to attract more prospective buyers and the time gap between the date of publication and sale was hardly sufficient for the prospective buyers to inspect the factory premises. The public notice was advertised by publishing in the Economic Times from bombay and Praja Vani from Bangalore, which would demonstrate that there was no enough publicity in the State of Karnataka to attract more prospective buyers and the time gap between the date of publication and sale was hardly sufficient for the prospective buyers to inspect the factory premises. The learned single Judge has not considered the inadequacy of value arrived at in the valuation report submitted by the Official liquidator more particularly when the assets were valued at Rs. 750 lakhs. The reasons given by learned single Judge for confirming the sale are erroneous and unsustainable. The learned single Judge has failed to notice that ii respondent-auction-purchaser, at the first instance offered Rs. 80. 45 lakhs, which was rejected. Therefore, within a span of few months he raised the offer to Rs. 124. 50 lakhs to the very same assets and thereafter raised that offer to reserve price of Rs. 165. 13 lakhs during the pendency of the proceedings, which would demonstrate the speculative approach of Second respondent in relation to the property in question. Thus, the learned single Judge ought to have held the offer made by II respondent from time to time being speculative in nature was not the best offer. For any reason, the learned single Judge had felt that highest offer of Rs. 124. 50 lakhs made by II respondent in the sale held on 6-3-2003 was inadequate and did not represent the best offer, the learned single Judge ought not to have confirmed the sale and ought to have directed the Official Liquidator to re-tender once over again. (iv) The learned single Judge has ignored the interest of the employees of the Company who admittedly are entitled to retrenchment compensation and also interim relief and consequential benefits as per order passed in Ref. No. 50/1995, dated 30-8-1999 on the file of ii Addl. Labour Court, Bangalore. ( 10 ) THE submission made by the learned counsel for the IF respondent may be summarised as follows : (i) The II respondent has filed objections contending that the offer made by II respondent is the best offer. The proceedings before the learned single Judge would demonstrate that neither Ex-Director of the Company nor the appellant herein was interested in getting better offer that what was offered by the II respondent. The proceedings before the learned single Judge would demonstrate that neither Ex-Director of the Company nor the appellant herein was interested in getting better offer that what was offered by the II respondent. It would also demonstrate that the ex-Director of the Company and appellant herein are interested in protracting the proceedings without there being any genuine intention to act in the interest of the Company under liquidation. (ii) Neither the Ex-Director nor the appellant made genuine efforts to bring better offer or to take intending purchasers to the inspection. On the other hand, they went on pleading for time before the learned single Judge on one pretext or the other. (iii) The learned single Judge was justified in confirming the sale in favour of II respondent who offered the highest price of Rs. 165. 13 lakhs and which is also reserve price indicated in the valuation report. There is no grievance by the secured creditors. The plant and machinery and other equipment found in the factory premises have become junk due to non-user. Therefore, the order passed by the learned single Judge does not call for interference in this appeal. ( 11 ) THE learned counsel appearing for Official Liquidator has submitted that the sale was held in accordance with law and the offer procured during the sale held on 6-3-2003 was the best offer and was in the interest of the Company. The non-mention of reserve price of sale publication has not resulted in any loss to the Company under liquidation. The II respondent has raised his highest offer to reserve price of Rs. 165. 13 lakhs which is also the valuation mentioned in the valuation report. Therefore, the learned counsel has submitted that the impugned order does not call for any interference. ( 12 ) BEFORE adverting to the submissions made by the learned Counsel for parties, it is necessary to refer to certain decisions cited by the learned counsel for the appellant. In a decision reported in (1999) 4 SCC 383 , relevant page 384 : ( AIR 1999 SC 1715 , para 21) the Supreme Court has held : "upon liquidation, the assets and properties of the company in liquidation vest in the official Liquidator for the benefit of its creditors. In a decision reported in (1999) 4 SCC 383 , relevant page 384 : ( AIR 1999 SC 1715 , para 21) the Supreme Court has held : "upon liquidation, the assets and properties of the company in liquidation vest in the official Liquidator for the benefit of its creditors. It is only from out of the sale proceeds of these assets and properties that the creditors of the Company can hope to recoup their dues. To ensure that the best possible price is realised upon the sale of these assets and properties, the sale thereof by the Liquidator is required to be confirmed by the High Court. It is the obligation of the High Court to the creditors of the Company in liquidation to make sure that the best possible price has been realised. " (Emphasis laid by us)It is further held : "in the first place, the Division Bench should have noted that the single Judge had with unseemly haste ordered possession thereof to be handed over to the second respondent on the very next day. " in a decision, reported in 2000 (5) SCC 274 relevant page 275, it is held : "in proceedings for winding up of the company under liquidation, the Court acts as a custodian for the interest of the company and the creditors. Therefore, before sanctioning the sale of its assets, the Court is required to exercise judicial discretion to see that properties are sold at a reasonable price. For deciding what would be a reasonable price, valuation report of an expert is a must. Not only that, it is the duty of the Court to disclose the said valuation report to the secured creditors and other interested persons including the offerers. Further, it is the duty of the Court to apply its mind to the valuation report for verifying whether the report indicates reasonable market value of the property to be auctioned, even if objections are not raised. " (Emphasis laid by us) In a decision reported in AIR 1970 SC 2037 , it is held : "where the acceptance of the offer by the commissioners is subject to confirmation of the Court the offerer does not by mere acceptance get any vested right in the property so that he may demand automatic confirmation of his offer. " (Emphasis laid by us) In a decision reported in AIR 1970 SC 2037 , it is held : "where the acceptance of the offer by the commissioners is subject to confirmation of the Court the offerer does not by mere acceptance get any vested right in the property so that he may demand automatic confirmation of his offer. The condition of confirmation by the Court operates as a safeguard against the property being sold at inadequate price whether or not it is a consequence of any irregularity or fraud in the conduct of the sale. In every case it is the duty of the Court to satisfy itself that, having regard to the market value of the property, the price offered is reasonable. Unless the Court is satisfied about the adequacy of the price the act of confirmation of the sale would not be a proper exercise of judicial discretion. " in the said decision it is further held : "rule 273 of the Companies (Court) Rules provides that all sales shall be made by public auction or by inviting sealed tenders or in such manner as the Judge may direct. Where the auction in question no doubt was conducted in a public place but it was not a public auction inasmuch as it was not open to the general public but was confined to two named persons, and secondly it was not held after due publicity, but immediately after it was decided upon, the sale in question was not a public sale which implies sale after giving notice to the public wherein every member of the public is at liberty to participate. The denial of opportunity to purchase the property by persons who would have taken part in the auction bid but for want of notice is a serious matter. " ( 13 ) THE learned counsel appearing for parties have taken us through the impugned judgment and relevant material on record. The first ground urged is regarding non-mention of reserve price in the sale advertisement. It is seen from the Copies of paper publication regarding sale publication furnished by the Official liquidator that the property brought to sale is divided into 3 lots. The first lot refers to converted land in an extent of 18. 5 acres situated at Bandamanahalli, Chickballapur Taluk, kolar District. The description of property is given as land in an extent of 18. The first lot refers to converted land in an extent of 18. 5 acres situated at Bandamanahalli, Chickballapur Taluk, kolar District. The description of property is given as land in an extent of 18. 5 crores situated at bandamanahalli, Chickballapur Taluk, kolar District along with buildings and other structures constructed. Under the caption Lot II-plant and machinery and other moveable assets are described as motors, electrical items, control panels, DG set, Machineries (General), Machineries (Spl. Purposes), Miscellaneous office equipments and Miscellaneous items, etc. Under the caption Lot-III, the word 'inventories' is mentioned without there being further description. The last date for submitting the tenders was fixed as 14-2-2003 and the date of opening the tenders was fixed on 6-3-2003. ( 14 ) AT the outset it is necessary to state that sale advertisement does not contain proper and complete description of properties; there is no proper description of the land; the survey number and the boundaries of the land are given. This was essential in view of the fact that prospective purchasers cannot inspect or identify land in the absence of proper description and also to ensure warranty of title in favour of prospective purchasers. The description of plant and machinery under Lot-II is also vague. The nature of machineries, type of machineries and the purpose for which they can be used are not mentioned. The description of inventories under Lot-III is vague and incomplete. The reserve price has not been mentioned. The time fixed for the last date for receipt of tenders was also inadequate. These facts would loom large in view of the controversial material available on record regarding valuation of assets. ( 15 ) AS could be seen from the proceedings before the BIFR, in Case No. 284/88 dated 21-9-95 the DGM of IFCI has stated, as per independent valuation report the realisation value of fixed assets of the Company was rs. 750 lakhs. As against this in the valuation report dated 10-4-2002 the total value of the movable fixed assets is shown as rs. 164. 46 crores. We also see from the proceedings of the meeting held on 10-6-2005 in the Office of the Official Liquidator, the land available is only 9. 3 acres in the name of Company under liquidation and not 18. 5 acres as mentioned in the advertisement. 164. 46 crores. We also see from the proceedings of the meeting held on 10-6-2005 in the Office of the Official Liquidator, the land available is only 9. 3 acres in the name of Company under liquidation and not 18. 5 acres as mentioned in the advertisement. In the said meeting it was resolved to return to II respondent a sum of Rs. 5,93,953/- paid as excess amount. Thus from these documents we find that there has been lot of variance regarding the actual valuation of assets of the Company. We also find from the proceedings of the meeting held on 10-6-2005 that the land available in the name of the Company was 9. 3 acres, as against this the extent of land was mentioned as 18. 5 acres in the advertisement. Under these confused state of affairs, it was very much essential for the Official Liquidator to have mentioned the correct extent, survey number and boundaries in the paper publication for the benefit of prospective buyers. Therefore, we hold the improper description of the land in Lot No. 1 is one of the material irregularity and illegality vitiating the sale. ( 16 ) ACCORDING to the valuation report, we find the total plinth area of the building is 8316 sq. meters. The paper publication does not contain the plinth area of the building and the nature of construction. We also see from the valuation report that there is separate valuation of the plant and machinery though this material is available with the Official Liquidator the same was not mentioned in the paper publication. ( 17 ) THE paper publication does not contain the reserve price. In a decision, reported in 2000 (5) SCC 274 the Supreme Court has held "for deciding what would be the reasonable price, valuation report of expert is a must. Not only that, it is the duty of Court to disclose such valuation report to secured creditors and other interested persons including the offerers". It is also held "it is the duty of the court to apply its mind to the valuation report for verifying whether report indicates reasonable market value of property to be auctioned even if objections are not received. It is also held "it is the duty of the court to apply its mind to the valuation report for verifying whether report indicates reasonable market value of property to be auctioned even if objections are not received. " from the impugned order we find that the learned single Judge apart from stating that non-mention of the reserve price in the paper publication did not result in any loss to the company has not adverted to the valuation report and the valuation made before BIFR and the details contained in the valuation report. Therefore, we are of the opinion that the learned single Judge ought to have adverted to these facts before confirming the sale. ( 18 ) FROM the impugned order we find that by order dated 25-9-2002 the Official Liquidator was permitted to sell the assets of the company. The II respondent herein was the highest bidder and he had offered the highest price of Rs. 80. 45 lakhs. The said offer was rejected by the Court with a direction to the official Liquidator to advertise the sale afresh. That in the subsequent sale held pursuant to the notification, the II respondent offered the highest bid of Rs. 1,24,50,000/- which was accepted by the learned single Judge on 10-4-2003. During the pendency of the applications filed by the appellant and the Ex-Director before the learned single Judge, on 3-7-2003 the II respondent raised his highest offer of Rs. 1,24,50,000/- to a sum of Rs. 165. 13 lakhs and pleaded for 60 days' time to deposit the same. Thus, we find during the period between 25-9-2002 and 3-7-2003 II respondent has gradually raised his offer from rs. 80. 45 lakhs to Rs. 165. 13 lakhs. The highest offer made by II respondent at the first instance was 1/3rd of the reserve price. Within a few months thereafter II respondent offered the price at Rs. 124. 5 lakhs. During the pendency of the proceedings before the learned single Judge, the II respondent raised his offer from rs. 124. 5 lakhs to Rs. 165. 13 lakhs. Thus, offers made by II respondent during the period between 25-9-2002 and 3-7-2003 would clearly demonstrate that the price offered by second respondent is not the reasonable and market price. It is also not clear as to what made the second respondent to raise the highest offer of Rs. 124. 5 lakhs to Rs. 165. 165. 13 lakhs. Thus, offers made by II respondent during the period between 25-9-2002 and 3-7-2003 would clearly demonstrate that the price offered by second respondent is not the reasonable and market price. It is also not clear as to what made the second respondent to raise the highest offer of Rs. 124. 5 lakhs to Rs. 165. 13 lakhs, within a period of 3 months. It cannot be said that the second respondent had raised the offer on 3-7-2003 to stand to lose. Therefore, it is clear that the highest offer made by ii respondent during the sale held on 3-7-2003 did not reflect the reasonable price by his own conduct. The learned single Judge having declined to consider the highest offer of Rs. 124. 5 lakhs as the best price should have directed the official Liquidator to advertise the sale afresh. Instead the learned single Judge had directed the applicants to bring better offers. It is needless to state when the property was brought to sale by public auction when the highest offer was found to be insufficient the only course left open to the learned single judge was to direct the Official Liquidator to advertise the sale afresh. It is also clear from the proceedings that in raising the price from highest offer to the reserve price the party involved for negotiations was only II respondent. There is no objective assessment by the learned single Judge that the price raised by ii respondent from Rs. 124. 5 lakhs to Rs. 165. 13 lakhs was the reasonable price. In a decision reported in AIR 1970 SC 2037 , it is held that "in every case it is the duty of the Court to satisfy itself that having regard to the market value of property the price offered is reasonable. Unless the Court is satisfied about the adequacy of the price the act of confirmation of sale would not be a proper exercise of a judicial discretion". From the impugned order we find the learned single Judge has not satisfied himself that the price offered by second respondent is reasonable. The reasonableness or the best price could have been ascertained by directing the Official liquidator to advertise the sale afresh with complete details of the property in the sale publication. From the impugned order we find the learned single Judge has not satisfied himself that the price offered by second respondent is reasonable. The reasonableness or the best price could have been ascertained by directing the Official liquidator to advertise the sale afresh with complete details of the property in the sale publication. We also find from the records made available by the learned counsel for the Official liquidator that the Official Liquidator had not secured the details of the landed properties to be sold in public auction. Except a copy of the survey sketch other details are not forthcoming. From this document, the boundaries of property cannot be ascertained. During the pendency of the appeal it is brought to our notice that in respect of the very property confirmed in favour of second purchasers the proceedings were pending before the Debt Recovery Tribunal in Case No. DCP. 3118. The proceedings were initiated by Industrial Finance Corporation of india Ltd. The property described therein comprised of 18 acres 13 guntas of land and the building with plinth area of 1137. 14 sq. ft. Thus, it is not clear as to whether the property secured to Industrial finance Corporation of India Ltd. was included in the sale confirmed in favour of II respondent. ( 19 ) FOR the reasons stated hereinbefore, we hold that order of learned single Judge, confirming the sale in favour of second respondent on the ground that second respondent has come forward with the highest offer raising his offer from Rs. 124. 5 lakhs to Rs. 165. 13 lakhs, without noticing the material irregularities, cannot be sustained. ( 20 ) THE learned counsel appearing for second respondent has filed an application along with certain documents to show that the land value within the vicinity of property of the company under liquidation was not more than rs. 20,000/- per acre. In the discussion made supra, we have stated the reasons to vitiate sale confirmation in favour of second respondent. Even otherwise, from the documents made available by learned counsel for second respondent, we find that the average value of the land is shown for the period between 20-2-2001 and 1-1-2006 which has no relevance for the purpose of decision of this case. Therefore, we are constrained to set aside the impugned order dated 13-11-2003 passed by the learned single Judge in Co. Therefore, we are constrained to set aside the impugned order dated 13-11-2003 passed by the learned single Judge in Co. A. No. 830/03 in c. P. No. 62/87 and request the learned single judge to direct the Official Liquidator to tender the property for sale afresh, in the light of the observations made in this order. Accordingly, we remand the case to the learned single Judge.