Bombay High Court
Ramsarup Industries Ltd. And 4 Ors vs Tata Capital Financial Services ... on 9 August, 2016
Bench: Anoop V. Mohta
PVR 1/22 appl276-16-Ramswarup.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
APPEAL (Lodg ) NO. 275 OF 2016
IN
CHAMBER SUMMONS NO.64 OF 2016
IN
ARBITRATION PETITION NO.707 OF 2012
WITH
NOTICE OF MOTION (LODG) NO.2222 OF 2016
AND
APPEAL (Lodg ) NO. 276 OF 2016
ig IN
CHAMBER SUMMONS NO.1690 OF 2015
IN
ARBITRATION PETITION NO.707 OF 2012
WITH
NOTICE OF MOTION (LODG) NO.2225 OF 2016
1.Ramsarup Industries Limited, a public limited )
company incorporated under the Companies Act, )
1956 and having its registered office at 1st floor )
Hastings Chambers, 7/c, Kiran Shankar Roy Road)
Kolkata-700001, West Bengal )
2. Aashish Jhunjhunwala residing at 10/4, Alipore)
Park Place, Kolkata -700027 and having office at )
1st floor, Hastings Chambers, 7/C, Kiran Shankar )
Roy Road, Kolkata - 700 001. )
3. M/s.Greentop Realtors Private Limited a private)
limited company incorporated under the )
Companies Act,1956 and having registered office )
at Hastings Chambers, 7C, Kiran Shankar Roy )
Road, Kolkata-700001, West Bengal. )
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PVR 2/22 appl276-16-Ramswarup.doc
4. M/s.Laddugopal Properties Private Limited )
a private limited company incorporated under the)
Companies Act,1956 and having registered office )
at Hastings Chambers, 7C, Kiran Shankar Roy )
Road, Kolkata-700001, West Bengal. )
5. M/s.Amanant Merchant Private Limited )
a private Limited Company incorporated under )
the Companies Act,1956 and having registered )
office at Hastings Chambers, 7C, Kiran Shankar )
Roy Road, Kolkata-700001, West Bengal )...Appellants
Versus
Tata Capital Financial Services Limited, a )
non-banking finance company duly registered
ig )
with Reserve Bank of India and incorporated )
under provisions of the Companies Act,1956 and )
having its registered office at One Forbes, Dr.V.B. )
Gandhi Marg, Fort, Mumbai-400001 and an office)
at DGP House, 4th Floor, Old Prabhadevi Road )
Mumbai-400025. )...Respondents
---
Mr.Dipesh Siroya, for the Applicants/Appellants.
Mr.Birendra Saraf with Mr.Tushar Kadam, Ms.Nazneen Kotwal, Mr.Abhishek
Padwalkar i/b. MDP & Partners, for the Respondents.
---
CORAM : ANOOP V. MOHTA &
G.S. KULKARNI, JJ.
Reserved on : 2nd August,2016
Pronounced on : 9th August,2016
----
JUDGMENT (PER G.S.KULKARNI, J.) :
1. These two Appeals arise out of the orders passed by the
learned Single Judge both dated 9 June 2016. Appeal (Lodg) No.276 of
PVR 3/22 appl276-16-Ramswarup.doc
2016 arises out of an order on Chamber Summons No.1609 of 2015 taken
out by the Appellants wherein the Appellants inter alia prayed that the
Respondents be directed to maintain status quo on disposal of the subject
mortgaged property, sale of which was undertaken under earlier orders
and finally in pursuance of the order dated 17 February 2014 passed by
the Division Bench in Appeal No.41 of 2014. Today the stage of sale is
that a deed of conveyance remains to be executed.
The other appeal being Appeal (Lodg) No.275 of 2016 arises
out of an order passed by the learned Single Judge on a Chamber
Summons filed by the Respondents, wherein the Respondents had prayed
that Appellant Nos.3 to 5 (original Respondents nos.3 to 5) be directed to
execute a deed of conveyance jointly in respect of the properties as sold to
the Petitioners in pursuance of the order dated 17 February 2014 in
Appeal No.41 of 2014. As the issues as raised before the learned Single
Judge leading to the passing of the orders as impugned in the respective
appeals are common on law and facts, we feel it appropriate to decide
these appeals by this common order.
2. After hearing the learned Counsel for the parties, we are of
the opinion that appeal (lodg) No.276 of 2016 which arises out of the
Chamber Summons taken out by the Appellants can decide the fate of the
companion Appeal (Lodg) no.275 of 2016 which arises out of the
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Respondents' chamber summons.
3. At the outset we may note that as regards the issue in these
proceedings, several orders are passed by the Court at different stages.
The Respondent had advanced financial facilities to Appellant No.1. One
of the directors of Appellant No.1 had furnished a personal guarantee for
repayment of the outstanding dues of the Respondent. Appellant Nos.3, 4
and 5 executed corporate guarantees in favour of the Respondent as also
had executed a mortgage of their properties in favour of the Respondent.
The Respondent had come across a circular issued by Appellant No.1 for
its shareholders whereby it was proposed to pass a resolution for approval
of sale and transfer of Appellant no.1's Windmill located at Dhule
(Maharashtra) with some other assets. The Respondent therefore filed
Arbitration Petition No.707 of 2012 under Section 9 of the Arbitration and
Conciliation Act,1996 (for short "the Arbitration Act") interalia praying for
appointment of Court Receiver, injunction and deposit of
Rs.25,30,32,482.69 in this Court. By an order dated 19 June 2012
Arbitration Petition No. 707 of 2012 was disposed of on the basis of
consent minutes, duly signed by the Advocates for the parties. The
dispute between the parties was referred to arbitration. The parties
consented for appointment of a private receiver in respect of the
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properties which were described under "Exhibit U" to the said petition.
There is no dispute that these properties were owned by Appellant Nos.3
to 5. The parties expressly agreed in the consent minutes that the receiver
shall sell the properties by public auction or under a private treaty. The
Appellants agreed not to create third party rights or part with possession
of the mortgaged properties, till such time as they were sold and to render
all co-operation and assistance to the private receiver for expeditious sale
of the properties. The sale consideration was to be deposited by the
private receiver in the Court and was subject to further orders of the
Arbitral Tribunal.
4. After the above consent order was passed, Appellant No.1
sometime in November, 2012 moved the BIFR by filing a reference which
came to be registered on 21 November 2012. Admittedly, the Respondent
was not given any notice in that regard. On registration of this reference
before the BIFR, the Appellants filed Chamber Summons No.60 of 2013 in
the Section 9 arbitration petition (Arbitration Petition No.707 of 2012)
contending that as the BIFR reference was pending, the properties
belonging to Appellant Nos. 3 to 5 which were furnished as security for
repayment of the outstanding dues of Appellant No.1 should not be sold.
The Appellants' also urged that as the guarantees were given by Appellant
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Nos.3 to 5, guaranteeing repayment of loan of Appellant No.1 in favour of
the Respondent, no steps ought to be taken by the Respondent in respect
of the personal properties of the guarantors which were mortgaged.
5. The learned Single Judge after hearing the parties and more
particularly considering the provisions of Section 22 of the Sick Industrial
Companies (Special Provisions) Act,1985 (for short "SICA") vis a vis the
proceedings under Section 9 of the Arbitration Act by an order dated 13
February 2013 held that since consent terms were arrived between the
parties resulting in the order dated 19 June 2012 in the Section 9
Arbitration Petition (Arbitration Petition No.707 of 2012), the amendment
to Section 22(1) of the SICA did not bar enforcement of such an order
passed by the Court in terms of the consent terms. It was thus held that
the implementation of the consent orders which interalia pertained to the
mortgaged property of the guarantors, cannot be stayed under Section 22
of the SICA. The learned Single Judge considering various decisions of
the Apex Court on the issue in paragraphs 35 and 38 of the order
observed as under:-
"35. The consent terms filed by both parties in Application
filed under Section 9 under Arbitration Act,1996 indicates that both
parties had agreed to refer the dispute to the arbitration and had
appointed the sole arbitrator. During the pendency of the arbitration
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proceedings, by consent of both parties, private receiver was
appointed with power of sale of such arbitration proceedings and
steps were taken by the private receiver by consent of parties to sell
the properties during the pendency of the arbitration proceedings. In
my view coercive steps can be stayed and not execution of the consent
orders. In my view consent terms filed in Court by parties was an
agreement and steps taken under such agreement cannot be stayed. It
is clear that there is apparent distinguishment between the expression
"proceedings" and "suit" used in section 22(1) of SICA. In my view,
steps taken to enforce the consent order passed under Section 9 of the
Arbitration and the Conciliation Act,1996 would not be barred by
Section 22(1) of the SICA.
38. ig Perusal of Section 22 (1) and more particularly 1994
amendment to Section 22(1) of SICA clearly indicates that in so far
as sick industrial company is concerned, any proceedings for winding
up, execution, distress for the like against any of the properties of the
industrial company or for the appointment of Receiver in respect
thereof is barred whereas the limited protection is granted in case of
guarantors only in respect of suit for recovery of money or for
enforcement of any security against the industrial company or of any
guarantee in respect of any loan or advances granted to the industrial
company."
Accordingly, the learned Single Judge repelling the case of the
Appellants on the basis of pending BIFR proceedings rejected the
Appellants' said chamber summons.
6. By a further order dated 1 April 2013 the learned Single
Judge allowed the sale of the property in question by a private treaty. The
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Court permitted the parties to offer their respective bids or to submit bids
of any other third party for the purpose of effecting auction by private
treaty by the Private Receiver/Commissioner.
7. The Appellants however filed another Chamber Summons
(lodg.no.754 of 2013) seeking stay of the sale of the properties at the
hands of a private receiver on the ground that the mortgaged properties
were not properly valued. By an order dated 24 July 2013 of the learned
Single Judge, this chamber summons was dismissed keeping open all
objections as regards valuation to be raised at the time of confirmation of
sale.
8. The private commissioner could get only one bid from the
Petitioner. The Appellants also failed to make any bid. By further order
dated 27 November 2013 the learned Single Judge granted an
opportunity to the Appellants to bring an offer higher than Rs.4 crores as
offered by the Respondent failing which the Respondent's offer would
stand confirmed. By a further order dated 19 December 2013, the
learned Single Judge inter alia considering various objections of the
Appellants accepted the offer of Rs.4 crores as made by the Respondent.
PVR 9/22 appl276-16-Ramswarup.doc
9. The said order dated 19 December 2013 passed by the
learned Single Judge accepting the Respondent's offer was challenged by
the Appellants in Appeal No.41 of 2014. By a detailed order dated 17
February 2014 the Division Bench disposed of the appeal in the following
terms:-
"12. The appeal is therefore, disposed of by the following order :-
i). The impugned order insofar as it confirms the sale, is upheld subject
however, to the appellants obtaining an offer of more than Rs.4.10 crores
together with all costs, charges and expenses incurred upto date in
connection with the sale of the property on or before 15.04.2014. In the
event of such an offer being brought on or before 15.04.2014, liberty to
the appellants to apply for modification of this order. The respondents
shall also be entitled to increase their bid. If such an offer is not obtained
by 15.04.2014, the sale in favour of the respondents shall stand confirmed
on 16.04.2014.
ii). The impugned order insofar as it permits the amount of Rs.4.00 crores
to be appropriated by the respondents is set aside.
iii). The parties agree as under :-
a). In the event of the sale being confirmed in favour of the respondents,
the respondents shall furnish a bank guarantee in the sum, in which the
sale is confirmed in their favour of a nationalized bank which shall
remain valid pending the arbitration proceedings and for a period of eight
weeks after the award is made and published.
b). In the event of the sale being confirmed in favour of any other
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party and the sale proceeds being deposited in this Court, the respondents
shall be entitled to withdraw the same to the extent of their claim subject
to the respondents furnishing a bank guarantee of a nationalized bank
which shall remain valid pending the arbitration proceedings and for a
period of eight weeks after the award is made and published.
c). Any bank guarantee shall also provide for interest at ad-hoc rate of
12% p.a., which shall be subject to the orders in the arbitration
proceedings.
iv). Till the sale is confirmed, all parties shall maintain status-quo in
all respects in respect of the said properties.
There shall be no order as to costs."
10. The above order dated 17 February 2014 of the Division
Bench in Appeal No.41 of 2014 was challenged by the Appellants before
the Apex Court in Special Leave Petition (Civil) No.9997 of 2014 which
was dismissed by the Apex Court by an order dated 2 May 2014. The
consequence of this dismissal by the Apex Court is that the sale of the said
property in favour of the Respondent stood confirmed. The Respondent
accordingly furnished a bank guarantee as directed by the Division Bench
in its order dated 17 February 2014 and only a ministerial act of executing
a conveyance in favour of the Respondent had remained to be
undertaken.
PVR 11/22 appl276-16-Ramswarup.doc
11. On the above background the Appellants moved Chamber
Summons No.1690 of 2015 on which the impugned order has been
passed, now seeking stay to the execution of conveyance again on the
same premise that the BIFR reference is pending and till the disposal of
the BIFR reference, no further steps ought to be taken to execute
conveyance and/or give effect to the orders of the Division Bench dated
17 February 2014 (supra) as confirmed by the Apex Court vide order
dated 2 May 2014. This plea of the Appellants was on the basis that after
the issue on the BIFR reference was decided by the learned Single Judge
by an order dated 13 February 2013 rejecting the contention of the
Appellants, there are subsequent judicial decisions which would support
the Appellants' contention that thus further proceedings of sale ought to
be stayed. The reliance of the Appellants before the learned Single Judge
was on the following two decisions (i) unreported decision in "Armada
(Singapore) Pte.Ltd. Vs. Ashapura Mine Chem Ltd." of the learned
Single Judge in Arbitration Petition No.1359 of 2010 dated 8 September
2015; (ii) the decision of the Delhi High Court in "Rakesh Madan & Anr.
Vs. Rajasthan Financial Corporation and ors." dated 13 January 2009 (
IA no.14090/2008 in C.S.(OS) No.513 of 2008.)
12. According to the Appellants, in "Armada (Singapore) Pte.Ltd.
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Vs. Ashapura Mine Chem Ltd.", it was held that in view of the pendency of
the proceedings before the BIFR no steps ought to be taken in execution of
the Award without the permission of the BIFR. The decision in "Rakesh
Madan & Anr." (supra) was relied to contend that the Appellants
notwithstanding the orders of the Division Bench dated 17 February 2014
(supra), as confirmed by the Apex Court, were entitled to re-approach the
Court in view of the above changed circumstances.
13.
The learned Single Judge by the impugned order has rejected
these contentions of the Appellants and dismissed the Chamber Summons
No.1690 of 2015. The learned Single Judge in the impugned order has
observed that in the order dated 13 February 2013 (supra) the issue as
regards the pendency of the BIFR reference was specifically dealt and
considering the position in law the plea of the Appellants came to be
rejected. The contention of the Appellants on the decision of the learned
Single Judge in Armada (Singapore) Pte Ltd. (supra) also did not find
favour by the learned Single Judge as the same was held to be not
applicable in the facts of the case.
14. The learned Counsel for the Appellant in assailing the
impugned order passed by the learned Single Judge in rejecting Chamber
PVR 13/22 appl276-16-Ramswarup.doc
Summons No.1690 of 2015, namely the prayer for stay on the execution
of the conveyance, would submit that the issue as regards BIFR reference
though decided by the learned Single Judge by orders dated 13 February
2013, is required to be reopened in view of the decision of the learned
Single Judge in the case Armada (Singapore) Pte Ltd. (supra). The
learned Counsel for the Appellants argued that this contention is further
supported by a decision of the learned Single Judge of the Delhi High
Court in the case of "Ankur Drugs and Pharma Ltd. Vs. A.C.Investments
Ltd." ( order dated 25.2.2015 in Arb.A.10/2015) which takes a similar
view. It is argued that in view of the said position in law the learned
Single Judge is in an error in rejecting the prayers for stay to the
execution of the conveyance as prayed in the chamber summons. No
other ground has been urged in the course of the submissions. On the
other hand learned Counsel for the Respondent has supported the
impugned order.
15. We have heard the learned counsel at length. With the
assistance of the learned Counsel for the parties, we have perused the
various orders passed in the proceedings and which we have noted above
as also the impugned orders.
PVR 14/22 appl276-16-Ramswarup.doc
16. After hearing the learned Counsel for the parties and on
considering the various orders which are passed in the different
proceedings as also the decisions of the learned Single Judge in Armada
(Singapore) Pte Ltd. (supra) and Ankur Drugs and Pharma Ltd.(supra)
as relied on behalf of the Appellants, we are unable to persuade ourselves
to interfere in the impugned order passed by the learned Single Judge, for
the reasons which we set out.
17.
Admittedly, the properties in question belong to Appellant
Nos.3 to 5 who are the guarantors and these properties are mortgaged
properties and not owned by the company-borrower. There is no dispute
that the sale of these properties was agreed between the parties in view of
the consent order dated 19 June 2012 passed in Arbitration Petition
No.707 of 2012. The Appellants in Chamber Summons No.60 of 2013
(supra) had attempted to nullify the effect of the consent order by raising
a plea that subsequent to the consent order dated 19 June 2012 a
reference as filed by Appellant No.1-company was registered with the
BIFR on 21 November 2012 and thus, in view of the provisions of Section
22(1) of SICA, further proceedings to sell the said properties ought to be
stayed. These prayers of the Appellants were rejected by a detailed order
of the learned Single Judge dated 13 February 2013, which was passed
taking into consideration the principles of law on the issue as laid down
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by the Apex Court, including the conduct of the parties. As noted above,
the private receiver proceeded to sell the properties, the Respondent's
offer for an amount of Rs.4 crore was accepted. By order dated 17
February 2014 of the Division Bench (supra), the sale is confirmed in
favour of the Respondent. Significantly this order of the Division Bench
was confirmed by the Apex Court by its order dated 2 May 2014 in SLP
Civil no.9997 of 2014. If this be the position we are unable to appreciate
as to how only on the decision in the case of Armada (Singapore) Pte
Ltd. (supra) the Appellants could approach the learned Single Judge
seeking a stay on the execution of the conveyance.
18. Upon considering the decision of the learned Single Judge in
Armada (Singapore) Pte Ltd. (supra), we are in complete agreement
with the observations of the learned Single Judge that this decision in no
manner would assist the Appellants. In Armada (Singapore) Pte Ltd.
(supra) a reference under Section 22 of the SICA was pending against the
company against whom a foreign award was passed by the learned
Arbitrator who came to be appointed under the English Arbitration
Act,1996. In the facts of the case and before the foreign award could be
held to be enforceable as per the provisions of the Arbitration Act, it was
held that there was no bar under Section 22 of the SICA to declare that
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the foreign award rendered in favour of the petitioner therein being
enforceable as decree of the Court. In this context, the learned Single
Judge made the following observations in paragraphs 37 and 42:-
37. As and when any application for execution of the said award as a
decree is pressed by the petitioner and if any coercive orders are
proposed to be passed which are prohibited under Section 22 of SICA,
the executing Court can consider the effect thereof. Be that as it may,
the petitioner has already applied for appropriate direction before the
BIFR and thus I am inclined to accept the submission of the learned
senior counsel for the respondent that no coercive orders can be
passed by this Court for execution of the said foreign award as a
decree of this Court at this stage.
42. This Court in the case of Pol India Projects Limited (supra)
has also adverted to the judgment of the Delhi High Court in the case
of Penn Racquet Sports Vs. Mayor International Limited, reported in
ILR (2011) Delhi 181 has held that the award should be contrary to
fundamental policy of Indian law for the Court of India for
recognition and enforcement of the foreign award. The judgment in
the case of Shri Lal Mahal Ltd. (supra) and the judgment of this
Court in the case of Pol India Projects Limited (supra) squarely apply
to the facts of this case. In my view, scope of objection under Section
48 to the enforcement of the foreign award is very limited. None of
the objections raised by the Respondent fall under any of the grounds
permissible under Section 48 of the Arbitration Act. In my view, the
respondent has not furnished any proof before this Court as to why
the enforcement of the foreign award may be refused. Both the
foreign awards are thus enforceable under Part II of the Arbitration
Act and are binding for all the purposes on the parties under Section
34 of the Arbitration Act. I am therefore of the view that the foreign
awards are already stamped as decrees. However, in view of the
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pendency of the proceedings before the BIFR, the petitioner would not
be entitled to take steps in execution of the award and seek any relief
which would be in violation of Section 22 of Sick Industrial
Companies (Special Provisions) Act, 1985 without permission of the
BIFR ."
The facts in the case in hand are completely different. In the present case
the Arbitration proceedings are pending. As observed by the Division
Bench in the order dated 17 February 2014 the parties are sufficiently
protected in view of the pending arbitration proceedings. Further, as noted
above and significantly we cannot be unmindful that there is a consent
order dated 19 June 2012 in pursuance of which a private receiver was
appointed to sell the mortgaged properties. We also cannot overlook the
further orders dated 13 February 2013 (Supra) of the learned Single
Judge whereby the very issue of the pendency of the BIFR proceedings
came to be adjudicated which inter-se between the parties, remains
undisturbed till date . Things do not stop at this as by further orders
dated 17 February 2014 of the Division Bench (supra) as confirmed by the
Apex Court by the order dated 2 May 2014 (supra), the sale stands
confirmed in favour of the Respondent. The learned Single Judge is right
in his conclusion that the cumulative effect of these orders is that there is
no escape from the fact that the Appellants cannot reopen the issues and
obstruct the execution of the conveyance which is a only ministerial act to
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be undertaken by raising a sole plea on the decision of the learned Single
Judge in the Armada (Singapore) Pte Ltd. (supra). We are of the clear
view that the issue as regards BIFR proceedings undoubtedly stood
concluded between the parties (the respondent and the guarantors) in
view of the decision of the learned Single Judge dated 13 February 2013
(supra) in the such circumstances of the case in hand.
19. In our opinion the reliance of the Appellants on the decision
of Delhi High Court in Ankur Drugs and Pharma Ltd. (supra) would also
not assist the Appellants. This was the case in which the Appellant was in
liquidation as also a reference under the SICA was pending and in view of
this position the Appellant had prayed for stay of the arbitration
proceedings as also a plea was taken that the arbitration proceedings
cannot taken against the guarantors.. The learned Arbitrator had rejected
the objection of the Appellants. In this context the learned Single Judge
of Delhi High Court considering the position in law, stayed the arbitral
proceedings till such time a leave of the BIFR is obtained. As can be seen
from these facts Ankur Drugs and Pharma Ltd.(supra) was not a case
where there was any consent order between the parties. It was also not a
case where the issue on the plea of pendency of BIFR proceedings in the
context of a consent order of sale of the mortgaged properties was
PVR 19/22 appl276-16-Ramswarup.doc
adjudicated as in the present case. It was also not a case where under the
orders of the Division Bench in the light of the consent terms, the sale
came to be confirmed in favour of the present respondent. Admittedly the
order of the Division Bench dated 17 February 2014 was confirmed by
the Apex Court. In view of this clear position we do not agree to the
reliance by the Appellants on the decision of the learned Single Judge of
the Delhi High Court in Ankur Drugs and Pharma Ltd. (Supra)
20.
There is no bar that the financial institution and the
guarantor cannot enter into a compromise in a Section 9 application. The
parties filed consent terms and had proceeded accordingly. The sale has
been confirmed upto the Supreme Court. Therefore, the further
consequential steps and proceedings in the present case, cannot be halted,
at the instance of the appellants, who have themselves filed the consent
terms and the parties having proceeded accordingly. There was nothing
wrong when the consent terms were recorded and modified further by
agreement. The rights have been crystalised, at least between the
Respondent and the guarantor (whose property is in question) much
before the filing of BIFR application by Respondent No.1. The impugned
order is in consequent to it.
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21. We are considering the scope and purpose of Section 9 of the
Arbitration Act,1996, in the peculiar present fact and circumstances. So
also the scope of inquiry under section 22 is somewhat different as the
consent terms were between Respondent/financial institution and the
guarantor, prior to the invocation of the BIFR proceedings by the
Respondent-Industry. A statement is also made by the learned Counsel for
the Appellants that the property involved in the present proceedings is not
the property owned by the company/undertaking but of the guarantor
only and that the same is not subject matter of the proceedings before the
BIFR. Thus the sale of property and the consequential ministerial act of
its execution of conveyance in the background in the facts of the case
cannot be halted at the instance of Appellant even though it arose out of
Section 9 proceedings, pending arbitration before the Arbitral Tribunal
and/or even the BIFR proceedings in question. All are the distinct and
separable proceedings.
22. The judgments cited on law on the scope of Section 22 of the
SICA need no discussion as the law is settled. As noted above the same
was subject matter of order dated 13 February 2013 and as recorded by
the learned Single Judge has admittedly attained finality. We have to deal
with the case in hand on the facts as they stand which we have recorded
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above. We are concerned with the implementation/execution interalia
application based upon the consent terms between financial institution
and the guarantor. The industrial/company's (Respondent's) arbitration is
pending before the Arbitral Tribunal. There is no executable order passed
under Section 9 application against the company and/or its property.
There is no coercive steps taken in this proceeding against the Respondent
-Industry/Company or its property pending BIFR proceedings. Therefore,
in view of the consent terms finality so attained, we see no reason to
interfere with the order so passed by the learned Judge.
23. As a result of the above discussion, we are certain that the
impugned order requires no interference. The appeal is without any merit
and is accordingly rejected.
APPEAL (LODG) No.275 of 2016
24. In view of the decision in Appeal (Lodg) No.276 of 2016,
undoubtedly, the impugned order dated 9 June 2016 passed in Chamber
Summons No.64 of 2016 cannot be interfered. The learned Single Judge
has rightly directed Appellant Nos.3 to 5 to jointly execute a deed of
conveyance of the properties which stand sold to the Respondent by virtue
of order dated 19 December 2013 as confirmed by the orders dated 17
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February 2014 in Appeal No.41 of 2014 (supra). The contention of the
appellants in opposition, on the issue of capital gain tax which would be
foisted on Respondent nos.3 to 5 also cannot be accepted. These are issues
which are definitely not germane to the basic terms and conditions of sale
which came to be accepted between the parties. It is an admitted position
that at the behest of the Appellants the properties which were directed to
be sold were mortgaged to the respondents by way of single mortgaged
deed and that the properties are sold as a single parcel and price offered
was a consolidated price of Rs.4 crores of the properties together.
Admittedly, at no stage the Appellants had raised any contention in regard
to the bifurcation and/or separate sale of the mortgaged properties, or in
regard to the any issue of a tax on capital gain. In our opinion, these
contentions are urged only to see that the finality of the sale is obstructed.
Resultantly we see no ground to interfere with the impugned order passed
by the learned Single Judge in Chamber Summons No.64 of 2016.
Accordingly, Appeal (lodg) No.275 of 2016 stands rejected.
25. In view of dismissal of Appeal (Lodg) Nos.276 and 275 of
2016, Notices of Motion (lodg)Nos. 2225 of 2016 and 2222 of 2016 do
not survive and are accordingly disposed of.
(G.S.KULKARNI, J.) (ANOOP V. MOHTA, J.)
