Summary

The appellant agreed with the Liquidator of Chisty Textile Mills Ltd., a nationalised mill wound up in 2003, to buy its assets for Tk. 35 crore, paying Tk. 15 crore down and the balance in instalments under an agreement dated 01.01.2014, and was given possession. The authorities later restrained its activities and refused a further instalment after allegations of irregularity. In Writ Petition No. 10820 of 2014 the High Court Division directed the respondents to accept the balance and execute the sale deed, but the Appellate Division set that aside in Civil Appeal No. 181 of 2016. Leave was then granted on review. The Appellate Division accepted that the sale was not wholly outside the statutory framework and that the Liquidation Cell still existed. It held, however, that the Liquidator could sell only by tender or auction, that the appellant had defaulted, that no concluded contract existed, that the arbitration clause provided an alternative remedy, and that no error apparent on the record was shown. The appeal was dismissed.

Issues

1. Q1

   Whether the Liquidator of a nationalised mill could sell it by negotiated agreement rather than by sealed tender or public auction.

2. Q2

   Whether the appellant, having defaulted on an instalment, could enforce the agreement for sale as a concluded contract through writ jurisdiction despite an arbitration clause.

3. Q3

   Whether any error apparent on the face of the record justified review of the earlier Appellate Division judgment.

Key points

• Since the Government's authority to dispose of the Mill derived from the statutory regime for nationalised industries, including Article 4(2) of the Order, 1972, the transaction could not be regarded as entirely outside that framework; but even assuming elements of a statutory contract, enforceability still depended on the terms of the agreement and the conduct of the parties.
• As the dissolution of the Liquidation Cell remained sub judice in Writ Petition No. 17233 of 2012 when the agreement was executed, it could not be said that the Cell was not in existence at that time.
• Under clause 2(5) of the Liquidator's appointment memo the Mill could be sold only by sealed tender or public auction, so the negotiated agreement bypassed the mandated process and the Liquidator had no power to sell other than by tender.
• A party in default of its own contractual obligations cannot seek equitable relief, whether under section 53A of the Transfer of Property Act, 1882 or otherwise, to enforce the contract it has breached; the appellant paid the second instalment on 30.06.2014 although it was due by 30.04.2014.
• The agreement was not a concluded contract, because the balance had to be paid and a sale deed executed and registered before the transfer could take final legal effect.
• Where the contract provides for arbitration, the party should ordinarily pursue that remedy rather than invoke article 102, and the clause was not inoperative merely because the Government was named as arbitrator; review under article 105 lies only for an error apparent on the face of the record, which was not shown.

Law considered

Bangladesh Industrial Enterprises (Nationalisation) Order, 1972 (P.O. No. 27 of 1972), Article 4(2)Bangladesh Industrial Enterprises (Nationalisation) Order, 1972 (P.O. No. 27 of 1972), Article 23(2)Transfer of Property Act, 1882, section 53AContract Act, 1872Constitution of the People's Republic of Bangladesh, article 102Constitution of the People's Republic of Bangladesh, article 105