High Court stays auction of HMT's property

High Court stays auction of HMT's property

The High Court on Thursday stayed the auction of a piece of land owned by Hindustan Machine Tools Ltd, measuring 5.9 acres in Mykalachennenahalli village in Yeshwantpur in Bengaluru North taluk.

The General Manager of HMT Ltd had petitioned the High Court against a decision of Bengaluru Urban deputy commissioner to auction the property to pay interest of Rs 38,18,868 on gratuity to the retired employees. The employees had earlier approached the controlling authority seeking payment of interest. The controlling authority in turn approached the deputy commissioner to raise the amount by auctioning the property. The deputy commissioner wrote to the tahsildar on June 20, 2015, to auction the HMT’s property to raise the amount. Accordingly, the Bengaluru North tahsildar wrote to HMT on August 3, 2015, asking it to pay the interest, and scheduled the auction for September 5, 2015 at 11 am.

T Rajaram, the counsel for HMT Ltd, however, contended that the company was already sick, and referred to the Board for Industrial and Financial Reconstruction (BIFR). He argued that it was the duty of the controlling authority to approach the BIFR with regard to the payment. Instead, the deputy commissioner was directed to raise the money as arrears of land revenue. The counsel argued the said notice by the tahsildar was illegal and must be quashed.

Justice A N Venugopala Gowda stayed the auction of the property after HMT deposited 50 per cent of the gratuity payable to the former employees.
DH News Service

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