ORDER Shantanu Kemkar, J. 1. Both these Appeals filed under Section 483 of the Companies Act, 1956 arise out of the order dated 09.12.2010 passed by the learned Company Judge of this Court in Company Petition No. 8/2005. These appeals involve common questions of facts and law and as such are being decided by this common order. For the sake of convenience, the facts are taken from Company Appeal No. 06/2010. 2. The first Respondent company Maikaal Fibres Limited was ordered to be wound up by the Company Judge vide order dated 06.01.2010. Prior to it an order was passed by the learned Company Judge on 7.05.2007 declining permission to Appellant Assets Reconstruction Company (India) Limited (for short the ARCIL) to sale assets of the company in liquidation under Section 13 of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (for short the SARFAESI Act). On appeal being filed against the said order dated 7.05.2007 the Division Bench of this Court vide order dated 6.08.2007 passed in Company Appeal No. 4 of 2007 permitted the Appellant to sell the secured assets of the first Respondent company in liquidation in accordance with the provisions of the Sarfaesi Act. The Division Bench issued following directions: 1. The Appellant shall endeavour to obtain / realize maximum price from the assets which can be alienated under the provisions of Sub-section (4) of Section 13 like a prudent man in respect of his own property. 2. The Appellant shall on realizing the amount, apply to the Company Court to inform the Appellant as to the dues of the workmen of the industry concerned. 3. The Appellant shall also place before the learned Company Judge a list of the other secured creditors and the amount due to them. 4. The Appellant company shall file an undertaking before the Company Court to the effect that the Appellant shall abide by the provisions of Section 529-A of the Companies Act as incorporated in Section 13(a) of the Sarfaesi Act, 2002. 3. In furtherance to the steps for sale of the properties in question, the ARCIL submitted I.A. No. 712/2010 before the learned Company Judge in the said Company Petition No. 8/2005 inter-aila praying for constitution of a Sale Committee comprising of representative of ARCIL and the Official Liquidator attached to the Company Court. 3. In furtherance to the steps for sale of the properties in question, the ARCIL submitted I.A. No. 712/2010 before the learned Company Judge in the said Company Petition No. 8/2005 inter-aila praying for constitution of a Sale Committee comprising of representative of ARCIL and the Official Liquidator attached to the Company Court. The learned Company Judge vide order dated 14.07.2010 allowed the said I.A. and ordered for formation of a Sale Committee comprising of the representative of ARCIL and the Official Liquidator with a direction that the Sale Committee so constituted shall not finalize the sale without the leave of the Company Court. 4. On the basis of the Valuation Report dated 09.06.2010 which was already obtained from a registered Valuer, the fair market value of the properties was fixed by the Sale Committee at Rs. 21,10,50,000/- and the Distress Market Value was fixed at Rs. 15,31,62,000/-. 5. On 22.09.2010 the sale notice was published by the Sale Committee in five newspapers having wide circulation in the country. In pursuance to the publication of the advertisement for sale in all five bids were received. Out of the five bidders in the process of interse bidding two bidders namely the third Respondent Wearit Global Limited (Appellant of Company Appeal No. 7/2010) and the fourth Respondent Manjeet Cotton Pvt. Limited emerged as top two bidders offering for Rs. 29.25 crores and Rs. 28.50 crores, respectively as against the fair market value of Rs. 21,10,50,000/-assessed by the valuer and fixed by the Sale Committee. 6. On completion of the process of interse bidding the Sale Committee submitted its report dated 15.11.2010 before the learned Company Judge and thereby recommended for the confirmation of sale in favour of the highest bidder Wearit Global Limited. The learned Company Judge after considering the said report dated 15.11.2010 vide impugned order dated 09.12.2010 refused to confirm the sale conducted by the Sale Committee. The learned Company Judge set aside the proceedings of sale and also directed refund of the security amount to all the bidders who had participated in the process of auction. The learned Company Judge further ordered to the Official Liquidator to get the fresh valuation report. Aggrieved, this company appeal has been filed by ARCIL. The Company Appeal No. 07/2010 is filed by the highest bidder Wearit Global Ltd. in whose favour the confirmation of sale was proposed by the Sale Committee. 7. The learned Company Judge further ordered to the Official Liquidator to get the fresh valuation report. Aggrieved, this company appeal has been filed by ARCIL. The Company Appeal No. 07/2010 is filed by the highest bidder Wearit Global Ltd. in whose favour the confirmation of sale was proposed by the Sale Committee. 7. Shri M.L. Verma, learned Senior counsel for the highest bidder Wearit Global Ltd. and Shri Manoj Munshi, learned Counsel for the ARCIL have contended that the learned Company Judge has committed a gross error in not confirming the sale as proposed by the Sale Committee in favour of Wearit Global Ltd. who's offer was much -more than the fair market value of the properties in question. They argued that the order passed by the learned Company Judge is not a speaking order as no reasons have been assigned by the learned Company Judge for not accepting the offer of the highest bidder when the offer of the highest bidder was much more than the fair market value of the properties in question. They also urged that the learned Company Judge has committed error in not confirming the sale on the ground that the difference in the Distress Value, Market Value and the highest offer received is of a large magnitude and that the offer of the highest bidder is more than the fair market value. 8. Shri Vijay Assudani, learned Counsel appearing for the proposed intervenor Ruby Traders has argued mat out of the properties which are to be sold in me auction one Diesel Generator set belongs to Ruby Traders who had purchased the same from the Company in liquidation prior to the sale notice by making a payment of Rs. 90 lakhs. In the circumstances, according to him, out of the sale proceeds of the properties in question, Ruby Traders is entitled to get Rs. 90 lakhs. Shri Sumeet Samvatsar, learned Counsel appearing for the proposed intervenor 'Sut Mill Kshramik Sangh', argued that while deciding the compliance report dated 15.11.2010 submitted by the Sale Committee the application filed by the proposed intervenor for disbursement of amount on priority basis has not been decided by the learned Company Judge. 9. We have considered the submissions made by learned Counsel for the parties and perused the record. 10. 9. We have considered the submissions made by learned Counsel for the parties and perused the record. 10. Admittedly, before the learned Company Judge, the prayer made by the Sale Committee through compliance report dated 15.11.2010 seeking confirmation of the sale in favour of the highest bidder Wearit Global Limited was not objected by anyone including the second highest bidder. 11. On going through the record and the said compliance report submitted by the Sale Committee, we find that the highest offer for the purchase of the properties in question was of Wearit Global Limited who offered Rs. 29,25,00,000/- as against the market value of the properties which was assessed by the approved valuer and fixed by the Sale Committee at Rs. 21,10,50,000/- and the Distress Market Value of Rs. 15,00,00,000/-. In the circumstances, when the offer of Wearit Global Limited was much more than the fair market value of the properties, there was no reason to reject the proposal of the Sale Committee. The learned Company Judge has set aside the sale proceedings and rejected the proposal of the Sale Committee by observing that there is difference of large magnitude in the Distress Market Value and the highest offer received. In our view this cannot be a ground to reject the prayer for confirmation of the sale in favour of the highest bidder. On the contrary this could have been a reason to accept the proposal of the Sale Committee. There can not be any doubt to the proposition that 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. However in the order of the learned Company Judge there is no whisper as to there is possibility of getting higher price or that the price offered by the highest bidder is not reasonable. 12. In the case of Kayjay Industries (P) Ltd. v. Asnew Drums (P) LTD and Ors. (1974) 2 SCC 213 the Supreme Court has held as under: A Court sale is a forced sale and, notwithstanding the competitive element of a public auction, the best price is not often forthcoming. The judge must make a certain margin for this factor. 12. In the case of Kayjay Industries (P) Ltd. v. Asnew Drums (P) LTD and Ors. (1974) 2 SCC 213 the Supreme Court has held as under: A Court sale is a forced sale and, notwithstanding the competitive element of a public auction, the best price is not often forthcoming. The judge must make a certain margin for this factor. A valuer's report, good as a basis, is not as good as an actual offer and variation within limits between such an estimate, however careful, and real bids by seasoned businessman before the auctioneer are quite on the cards. Businessman makes uncanny calculations before striking a bargain and that circumstance must enter the judicial verdict before deciding whether a better price could be had by a postponement of the sale. If the Court sales are too frequently adjourned with a view to obtaining a still higher price it may prove a self-defeating exercise, for industrialists will lose faith in the actual sale taking place and may not care to travel up to the place of auction being uncertain that the sale would at all go through. The judgment debtor's plea for postponement in the expectation of a higher price in the future may strain the credibility of the Court sale itself and may yield diminishing returns. In all public sales the authority must protect the interest of the parties and the rule as stated by the Supreme Court in Neyalkha and Sons v. Ramanya Das should govern all auction sales be they by a receiver, commissioner, liquidator or Court. But is not as if the Court should go on adjourning the sale till a good price is. got, it being a notorious fact that court sales and market prices are distant neighbours. Otherwise, decree-holders can never get the property of the debtor sold. Nor is it right to judge the unfairness of the price by hindsight wisdom. Maybe, subsequent events, not within the ken of the executing Court when holding the sale, may prove that had the sale been adjourned a better price could have been had. 13. In the case of State of Punjab v. Yoginder Sharma Onkar Rai and Co. (1996) 6 SCC 173 it has been held by the Supreme Court that the finality of auctions must also be recognised to be in the interests of the exchequer. 13. In the case of State of Punjab v. Yoginder Sharma Onkar Rai and Co. (1996) 6 SCC 173 it has been held by the Supreme Court that the finality of auctions must also be recognised to be in the interests of the exchequer. If auctions are set aside and reauctions are ordered on less that satisfactory material, the loss of the exchequer would be far greater. In the absence of satisfactory material to substantiate that the auction has not been conducted in fair and prescribed matter causing loss to the exchequer the finality of the auction should be maintained re-auctioning also cause loss to the exchequer. 14. In the case of NGEF Ltd. v. Chandra Developers (P) Ltd., and Anr. (2005) 8 SCC 219 in para 60 and 61 the Supreme Court has held as under: 60. There lies a distinction between accord of sanction for private negotiation of sale of assets of the company vis-a-vis the auction held by the Official Liquidator. It is not in dispute that no Provisional Liquidator was appointed. The court may have an inherent power to approve a transaction of sale entered into by and between the company and the third party; but it is beyond any cavil of doubt that while doing so the Company Court must bear in mind its duties towards the creditors. While exercising jurisdiction under Section 433 of the Companies Act, the Company Court remains the custodian of the interest of the company and its creditors. It has, thus, a duty to satisfy is reasonable. (See Kayjay Industries (P) Ltd.). It is furthermore required to be borne in mind that upon liquidation, the assets and properties of the company vest in the Official Liquidator for the benefit of its creditors. (See Allahabad Bank v. Bengal Paper Mills Co. Ltd.). 61. The satisfaction as regards adequacy of the price is one of the relevant factors for proper and reasonable exercise of the judicial discretion vested in it. (See Allahabad Bank v. Bengal Paper Mills Co. Ltd.). 61. The satisfaction as regards adequacy of the price is one of the relevant factors for proper and reasonable exercise of the judicial discretion vested in it. There cannot be any doubt or dispute that when an auction is held upon compliance with the statutory provisions, withholding of auction on the ground that a still higher price may be obtained may prove to be a self-defeating exercise as has been held in Kayjay Industries (p) Ltd. and State of Punjab v. Yoginder Sharma Onkar Rai & Co., but having regard to the accepted position that the Company Judge in a case of this nature exercises a discretionary jurisdiction; it is bound to act with great circumspection and caution. Such a jurisdiction should ordinarily be exercised in exceptional cases and when necessary for seeing the company as an ongoing concern. 15. As already observed in the impugned order the learned Company Judge has not assigned reasons for not confirming the sale in favour of the highest bidder as prayed by the Sale Committee. Failure to give reasons amounts to denial of justice. Reasons are live links between the mind of the decision taker to the controversy in question and the decision or conclusion arrived at. Reasons substitute subjectivity by objectivity. Right of reason is an indispensable part of the sound judicial system. Another rationale is that the affected party can know why the decision has gone against him. One of the salutary requirement of natural justice is spelling out reasons for the orders made, in other words a speaking out. [See (1971) 1 All ER 1148 (CA), Breen v. Amalgamated Engg. Union Alexander Machinery (Dudley) Ltd. V. Crabtree 1974 ICR 120 (NIRC), Steel Authority of India Limited v. Sales Tax Officer, Rourkela Circle and Ors. (2008) 9 SCC 407 State of Himachal Pradesh v. Parashram AIR 2008 SCW 373, State of Punjab v. Bhagsingh 2004 (1) SCC 547 ]. 16. In the case of Assistant Commissioner Commercial Tax Department v. Shukla and Brothers (2010) 4 SCC 785 , the Supreme Court reiterating its earlier view stated that recording of reasons is an essential feature of dispensation of justice. A litigant who approaches the Court with any grievance in accordance with law is entitled to know the reasons for grant or rejection of his prayer. Reasons are soul of orders. A litigant who approaches the Court with any grievance in accordance with law is entitled to know the reasons for grant or rejection of his prayer. Reasons are soul of orders. Non-recording of reasons could lead to dual infirmities; firstly it may cause prejudice to the affected party and secondly, more particularly hamper the proper administration of justice. These principles are not only applicable to the administrative or executive auctions, but they apply with equal force and, in fact with a greater degree of precision to judicial pronouncements. The orders of the Court must reflect what weighed with the Court in granting or declining the relief claimed by the applicant. It is the reasoning alone that can enable a higher or an appellate court to appreciate the controversy in issue in its correct perspective and to hold whether the reasoning recorded by the court whose order is impugned, is sustainable in law and whether it has adopted the correct legal approach. 17. Considering the impugned order passed by the learned Company Judge in the light of the aforesaid pronouncements of the Supreme Court we find that the order impugned in this company appeal is not sustainable. The Sale Committee comprising of representative of ARCIL and the official liquidator after giving wide publicity in various newspapers including newspapers of wide circulation in the country to the proposed auction received various offers. After evaluation and interse bidding it found the offer of Wearit Global Limited (Appellant in the Company Appeal No. 07/2010) to be highest. The offer was also found to be much more than the fair Market Value. In the circumstances, the learned company Judge fell into error in setting aside the proposal made by the Sale Committee to confirm the bid of the highest bidder. The difference in the Distress market Value, Fair Market Value fixed by the Sale Committee than the highest offer which was much more than the Distress Market Value and Fair Market Value can by no stretch of imagination be a reason for not accepting the offer of the highest bidder. On the contrary the same is a good ground to accept the bid of the highest bidder. 18. We also find that there was no objection from any comer that the properties in question can be sold at higher price than the price offered by the highest bidder Wearit Global Limited. On the contrary the same is a good ground to accept the bid of the highest bidder. 18. We also find that there was no objection from any comer that the properties in question can be sold at higher price than the price offered by the highest bidder Wearit Global Limited. The said proposal of the Sale Committee was not even objected by the second highest bidder. Neither the Official Liquidator who was party to the sale proceedings nor any other creditor of the company in liquidation ever submitted or stated before the Company Judge or before us that the properties can be sold at a higher price than the price offered by the highest bidder. 19. With a view to satisfy ourselves about the contentions of the Appellants that the price offered by the highest bidder is reasonable and is not inadequate, we have gone through the valuation which the Official Liquidator has carried out by another valuer in pursuance to the impugned order dated 09.12.2010 passed by the learned Company Judge. On a comparison of the said fresh valuation the earlier valuation report we find that even if the fresh valuation which is Rs. 24,86,20,000/- is taken to be correct, still the offer made by the highest bidder is Rs. 29,25,00,000/- which is much more than the fresh valuation of the said properties. 20. Before this Court on being categorically asked' the Official Liquidator made a statement that he was party to the sale proceedings and he never objected to the proposal of the Sale Committee and today also he is not in a position to contend that the price quoted by. the highest bidder is on lower side or that the properties in question can be sold at more price. He also affirmed the contention of the learned Counsel for the Appellants that the price of the properties in question assessed in the fresh valuation is also less than the price offered by the highest bidder. 21. In the circumstances, we are of the considered view that the learned Company Judge has committed an error in not approving the report submitted by the Sale Committee seeking declaration of Wearit Global Limited as successful bidder. 21. In the circumstances, we are of the considered view that the learned Company Judge has committed an error in not approving the report submitted by the Sale Committee seeking declaration of Wearit Global Limited as successful bidder. Accordingly, we set aside the order dated 09.12.2010 passed by the learned Company Judge and declare Wearit Global Limited (Appellant of Appeal No. 07/2010) a successful bidder and confirm the sale of assets of the company (in liquidation) in favour of Wearit Global Limited. The sale certificate be issued and sale deed be executed by the Sale Committee as per the provisions contained in the Sarfaesi Act and the Companies Act and the Rules made thereunder in favour of the said successful bidder upon receipt of the entire offer amount of Rs. 29,25,00,000/-. The Sale Committee is directed to return the EMD received from other bidders. 22. So far as the application submitted by Ruby Traders, learned Counsel appearing for Ruby Traders and the counsel for the Appellants as also the official liquidator did not dispute that the claim of Ruby Traders requires to be adjudicated by the learned Company Judge. They made a submission that the amount of Rs. 90 lakhs said to have been paid by Ruby Traders be ordered to be kept in a Nationalized Bank in an interest bearing fixed deposit which shall be payable subject to result of the decision as may be taken by the learned Company Judge in that regard. This submission made by learned Counsel for the parties appears to be reasonable. Accordingly, we direct that out of the sale proceeds an amount of Rs. 90 lakhs be kept in a nationalized Bank in an interest bearing fixed deposit and payment of the said amount shall be subject to the orders as may be passed by the learned Company Judge in that regard keeping in view the provisions of Companies Act and the Rules made thereunder. As regards, I.A. for intervention filed by the 'Sut Mill Kshramik Sangh', it has been stated by learned Counsel for. this intervenor that the prayer about disbursement of the amount has already been made before the learned Company Judge who be directed to decide the same. This prayer also appears to be reasonable. The learned Company Judge, shall decide the same in accordance with law. 23. this intervenor that the prayer about disbursement of the amount has already been made before the learned Company Judge who be directed to decide the same. This prayer also appears to be reasonable. The learned Company Judge, shall decide the same in accordance with law. 23. With the aforesaid observations and directions, the Company Appeal stands allowed with no orders as to costs.