Telangana Court Rejects UBI's Asset Auction

The Telangana High Court recently made a decision about a company called BRG Energy Ltd and the Union Bank of India (UBI).

BRG Energy Ltd was in financial trouble and was ordered to be wound up in 2018.

This means the company's assets, like a big piece of land, were supposed to be taken care of by an official liquidator to sell them and pay back the company's debts.

However, UBI tried to sell the same land separately to recover money it was owed.

The court said this was not allowed because once a company is being wound up, only the official liquidator can handle the sale of its assets.

The court also noted that UBI did not involve the official liquidator in setting the price for the auction and did not take care of the workers' provident fund dues.

The High Court agreed with an earlier decision to cancel UBI's auction and dismissed UBI's appeal, reinforcing that recovery actions cannot happen separately once winding-up proceedings have started.