The Hindu Business Line : Perungalathur property belongs to Standard Motors: HC informed

THE Perungalathur property extending to 57 acres belonged to Standard Motor Products of India Ltd, now under liquidation, going by documentary and other evidence, the Madras High Court was informed by some of the financial institutions on Wednesday.

Following certain doubts raised by the Bangalore-based Sriram Properties Private Ltd, the successful bidder in the auction held by the Court to sell the land and plant and machinery, the counsel said the company had been granted patta for the land more than 40 years ago. It had since then been mortgaging the property to raise money for various purposes. Besides, it had been paying all the taxes and duties, including kist.

Though the State Government had by a GO dated May 10, 1983 assigned the land to the then company, Union Motors (which subsequently became Standard Motor Products), for the sole purpose of setting up an automobile industry, the company had established the industry and had been profitably running it for years. Later, it became sick. The company had also paid the value fixed by the Government for the land at the rate of Rs 500 per acre.

On behalf of the successful bidder, it was submitted that the price of Rs 154.10 crore had been accepted at the auction, and that the bidder was ready to deposit the amount "now itself". But the bidder would like the Official Liquidator to clarify certain doubts that had cropped up in regard to the ownership of the land.

Ms Justice R. Banumathy, who heard the case on Wednesday, asked the Official Liquidator to submit a report clarifying the points raised by the bidder. She adjourned the case to November 28.

On November 1, the Judge had confirmed the sale of the property to Sriram Properties and directed the outfit to remit the total value on or before November 30. The counsel for Sriram Properties had submitted to the Court that when the documents were verified, they came to know that as per the stipulations of the State Government, the land should not be alienated or sold to any third party as it was assigned on perpetuity basis.

Standard Motors factory stopped operations more than two decades ago, and since then the workers, numbering about 2,000, had been hoping to get their due share of the compensation.

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