The Hindu : Business : Court order on SMPL title deed

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Thursday, Nov 24, 2005

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Court order on SMPL title deed

Special Correspondent

Sriram Properties files petition

CHENNAI: The Madras High Court has asked for verification of property documents concerning Standard Motor Products of India Limited (SMPL), which was auctioned for over Rs. 154 crore on October 28.

Justice R. Banumathi gave the direction to the Official Liquidator on Wednesday when Sriram Properties Limited, which was the successful bidder for the 57.94-acre property along with trees, buildings and plant and machinery, filed a petition raising apprehensions over the legal status of the property.

It said that the property was transferred to Union Co. (Motors) Limited in December 1949 at the rate of Rs. 500 per acre, with a condition that it should not be used for any other purpose.

"The land shall not be used except for the purpose of setting up plant for the assembly of motor cars, motor cycles, trucks, and allied machines,'' the clause said, according to the petitioner.

It wanted the court to direct the Liquidator to verify if such a condition still existed and whether the land could be transferred by way of sale, gift, mortgage or lease.

`Delaying tactics'

However, N. V. Srinivasan, counsel for the Industrial Development Bank of India (IDBI), which is the biggest secured creditor, submitted that Sriram Properties Limited was adopting delaying tactics.

He argued that since Standard Motor Products had been wound up, the conditions laid down at the time of assigning the land would lapse automatically.

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