Authority: National Company Law Tribunal, Hyderabad Bench - I

Order Date: 18 June 2026

Case Overview

This application was filed by Puissant Global Private Limited under Section 60(5) of the Insolvency and Bankruptcy Code, 2016, against Bhoothpur Municipality, Sub-Registrar Jadcherla, Tahsildar Bhoothpur, and the Liquidator of Aster Private Limited. The applicant sought to quash a demand notice dated 08.09.2023 issued by Bhoothpur Municipality directing authorities not to entertain registration of two properties and demanding property tax of ₹10,59,32,349 for the period 2017-18 to 2023-24.

Aster Private Limited was admitted into Corporate Insolvency Resolution Process on 16.12.2019 and subsequently into liquidation on 22.09.2021 with CA Naren Sheth appointed as Liquidator. After NCLAT vacated a stay on liquidation on 23.02.2023, the liquidator conducted e-auctions of two properties:

  • Said Property No.1: 67.40 acres with building (77,500 sq ft) and plant & machinery at Survey Nos. 197(P), 198(P), 251(P) of Bhoothpur Village, sold for ₹46,78,00,000 on 29.04.2024
  • Said Property No.2: 34.3 acres non-agricultural land at Survey Nos. 197, 198(P), 207(P), 251(P) of Bhoothpur Village, sold for ₹26,00,00,000 on 12.06.2024

The applicant paid total consideration of ₹47,69,14,565 (including interest of ₹91,14,565) for Property No.1 and ₹26,53,13,995 (including interest of ₹53,13,995) for Property No.2, receiving sale certificates on 20.08.2024 and 05.10.2024 respectively.

The tribunal noted that the auction was conducted on an "as is where is", "as is what is", "whatever there is" and "no recourse" basis, with specific disclosure of the property tax demand in the Process Memorandum dated 02.04.2024. The Letter of Intent and Sale Certificates expressly stipulated that all applicable taxes relating to the sale shall be borne by the Successful Bidder.

Final Outcome

The application was dismissed. The tribunal held that the applicant, having participated in the auction with full knowledge of the outstanding property tax demand and having accepted the terms of the Process Memorandum, Letter of Intent and Sale Certificates, is bound by the contractual conditions and is liable for the property tax. The court applied the principle of caveat emptor and cited NCLAT precedent in Visisth Services Limited v. S.V. Ramani & Ors. that bidders cannot wriggle out of contractual obligations arising from acceptance of their bid.

Topics: Insolvency Liquidation, Property Tax Dispute, Auction Terms