Bombay High Court
Edward Mauritius Ltd. And Anr vs Kakade Estate Developers Private ... on 9 November, 2022
Bench: B.P. Colabawalla
26-IA(L)-24451-2021.doc
GANESH
SUBHASH
LOKHANDE
Digitally signed by
GANESH SUBHASH
LOKHANDE
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
Date: 2022.11.10
17:25:09 +0530
ORDINARY ORIGINAL CIVIL JURISDICTION
IN ITS COMMERCIAL DIVISION
INTERIM APPLICATION (L) NO. 24451 OF 2021
IN
COMMERCIAL EXECUTION APPLICATION (L) NO. 24448 OF 2021
Edward Mauritius Ltd. & Anr. .. Applicants/Award Holders
/ Judgment Creditors/
Org. Respondent Nos. 6 & 7
Vs.
Kakade Estate Developers Private
Ltd & Ors .. Judgment Debtors/
Org. Respondent Nos. 1 to 5
Vistra ITCL (India) Ltd. & Anr. .. Org. Claimants
Aditya Shiralkar a/w. Nanki Grewal & Manasi Joglekar i/b. Wadia
Ghandy & Co. for the Applicants.
Purvi Doctor i/b. Elixir Legal Services for Respondent Nos. 1 to 5.
CORAM:- B. P. COLABAWALLA,J.
DATE :- 9th NOVEMBER, 2022.
P. C.:
1. Mentioned. With the consent of parties taken out of turn.
Ganesh Lokhande page 1 of 13
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2. It has been brought to my attention that certain Survey Nos.
have been missed out in paragraph 11 of the order dated 13 th October,
2022 which need to be inserted therein.
3. So that there is no confusion in the future, for the existing
paragraph 11, the following shall be substituted:
"11. In view of the forgoing discussion, the Court
Receiver shall now proceed to sell the immovable property
of Respondent No. 2 being Survey Nos. 109, 114, 115/1,
116, 115/7, 115/5, 110, 115/8, 115/12, 119/1, 125/4,
115/13, 203, 202, 8/4, 8/5, 7/1, 8/1, 8/2, 8/3, 8/6, 130/B/1,
113/2, 143, 115/3, 105/4, 105/1, 111, 105/2, 109, 123/1,
130/2B, 125/3, 107, 108, 115/2, 115/6, 115/11, 118/2,
122/2, 124, 109, 106/1B, 106/1C, 7/3, 7/4, 106/2A and
106/1A situated within the Registration Sub-District,
Taluka- Mulshi, District Pune, Village - Bhugaon, Pune
and situate within the limits of Town Planning for
Concerned Authority. To take process of sale forward, the
Court Receiver shall appoint a valuer from this panel to
value the said property. Once the valuation is done, the
Court Receiver shall file a report before this Court for
fixing the reserve price. It is made clear that the reserve
price shall not be disclosed to any party. Once the reserve
price is fixed, the Court Receiver shall seek further
directions for advertisement etc. to take the sale of the said
property to its logical conclusion."
Ganesh Lokhande page 2 of 13
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4. No other correction is sought. The correction shall be
carried out in the original order as well as in the copy uploaded on the
server.
5. Place the above matter on 21st November, 2022.
6. This order will be digitally signed by the Personal Assistant
of this Court. All concerned will act on production by fax or email of a
digitally signed copy of this order.
( B. P. COLABAWALLA, J. )
For the sake of convenience the corrected order reads thus:
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
IN ITS COMMERCIAL DIVISION
INTERIM APPLICATION (L) NO. 24451 OF 2021
IN
COMMERCIAL EXECUTION APPLICATION (L) NO. 24448 OF 2021
Edward Mauritius Ltd. & Anr. .. Applicants/Award Holders
/ Judgment Creditors/
Vs.
Ganesh Lokhande page 3 of 13
26-IA(L)-24451-2021.doc
Kakade Estate Developers Private
Ltd & Ors .. Judgment Debtors/
Vistra ITCL (India) Ltd. & Anr. .. Org. Claimants
Zal Andhyarujina, Sr. Counsel with Karan Bhide, Aditya Shiralkar a/w.
Nanki Grewal and Manasi Joglekar for the Applicants.
Purvi Doctor a/w. Shweta Rathod i/b. Elixir Legal Services for
Respondent Nos. 1 to 5.
Sameer A. Alekar, Asst. S. O. from the Office of Receiver is present.
CORAM:- B. P. COLABAWALLA,J.
DATE :- 13th OCTOBER, 2022.
P. C.:
1. The above Interim Application is filed seeking various
interim reliefs against Respondent Nos. 1 to 5 who are the Judgment
Debtors. Initially, the Applicants and Respondent Nos. 1 to 5 entered
into a Consent Terms dated 25 th November, 2020. The decretal amount
under the Consent Terms was Rs.121.77 Crores approximately. This
amount was to be paid in the manner set out in the Consent Terms. The
Consent Terms further provided that in the event of any
default on the part of Respondent Nos. 1 to 5, the entire amount of
Ganesh Lokhande page 4 of 13
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Rs.121,77,53,425/- would become payable. These Consent Terms were
taken on record by the Arbitral Tribunal on 19 th January, 2021 and a
Consent Award was passed.
2. Since, Respondent Nos. 1 to 5 [and whose liability was joint
and several] defaulted in making payment of the very first installment
under the Consent Terms, the Applicants issued a default notice to
Respondent Nos. 1 to 5. On the very same day, the said notice was
replied to [by email] and an extension was sought for making payment.
3. Be that as it may, since no payment was made, the above
Execution Application was filed seeking execution of the Consent Award
dated 19th January, 2021 read with the Consent Terms dated 25th
November, 2020. It is in this Execution Application, the above Interim
Application is filed seeking various interim reliefs.
4. Initially, on 28th October, 2021, this Court allowed the
above Interim Application in terms of prayer clause (a) which basically
relates to disclosures. This Court directed that the disclosure affidavit
shall be filed by each of the Respondents, namely, Respondent Nos. 1 to
5 by 22nd November, 2021. All supporting documents in original were
also to be offered for inspection on or before 22nd November, 2021.
Ganesh Lokhande page 5 of 13
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Thereafter, on 30th November, 2021, an extension of time was sought for
filing the disclosure affidavit which was granted by this Court. The
disclosure affidavits were thereafter filed on 7th December, 2021.
5. On 8th December, 2021, a detailed order was passed by this
Court in the above Interim Application. By the said order, the Court
Receiver, High Court, Bombay was appointed in respect of the land
situate at Bhugaon, Pune forming the subject matter of the
Development Agreement dated 21st April, 2008. In the said order, it was
made clear that the appointment of the Receiver will not in any manner
affect the ongoing negotiations for availing of credit facilities or other
investments that the proposed lenders/investors may have entered into
with Respondent Nos.1 to 5 and/or any of them. Liberty was granted to
the Respondents and the proposed lender/investor to apply to the Court
in the event the proposed lender/investor sanctioned any facilities to
Respondent Nos. 1 to 5 so that the decretal debt in the present
proceedings could be secured by the said lender/investor by depositing
in this Court the amount sufficient to meet the decretal debt. The reason
why this order was passed was because an argument was canvassed on
behalf of Respondent Nos. 1 to 5 that a proposal to restructure their
finances [by availing fresh credit facilities], was under negotiations. If
they were in a position to avail of fresh credit facilities, they would be
Ganesh Lokhande page 6 of 13
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able to pay the decretal debt without much difficulty, was the argument
canvassed by Respondent Nos. 1 to 5.
6. Be that as it may, as per the order dated 8 th December,
2021, the Court Receiver has taken possession of the Bhugaon property
on 20th December, 2021 and has also prepared a site report evidencing
this fact.
7. In this factual backdrop, Mr. Andhyarujina, the learned
senior counsel appearing on behalf of the Applicants, submitted that
sufficient time has now been given to Respondent Nos. 1 to 5 to
restructure their so called finances without any success and therefore
the Receiver should now be directed to sell the property of which he has
been appointed and the sale proceeds thereof be paid over to the
Applicants to the extent of their decretal debt. He also brought to my
attention that this order is now all the more necessary because from the
affidavits of disclosures filed, it is apparent that huge amounts are being
transacted inter-se between different companies of the Kakade Group
including Respondent Nos. 1 to 5. The chart showing these transactions
are as under:
Chart- Related Party and Unexplained Transactions:
Sr. No. Particulars Reference in the
Ganesh Lokhande page 7 of 13
26-IA(L)-24451-2021.doc
Affidavits of
Disclosure ("AoD")
1. R2 i.e. Mr. Sanjay Kakade and R3 i.e. Audited Balance Sheet
Mrs. Usha Kakade have availed loans of R5 for the year ended
and advances from R5 i.e. Kakade 31st March, 2020 [Ref:
Retailing Private Limited amounting to Note 10 - Short Term
approximately 86 Crore [Ref: Para No. Loans and Advances. @
13(a) @ page 108 of the Additional page 180 of the
Affidavit dated 4th April 2022 of the Disclosure Affidavit of
Applicants ("Additional Affidavit") R5]
2. R2 and R3 have availed loans and Audited Balance Sheet
advances from R4 i.e. Kharadi of R4 for the year ended
Properties Private Limited amounting to 31st March, 2020. [Ref:
approximately 9 crore. [Ref: Para No. 13 Note 8 - Short Term
(b) @ page 108 of the Additional Loans and Advances. @
Affidavit.] page 157, of the
Disclosure Affidavit of
R1.]
3. R5 i.e. Kakade Retailing Private Limited Audited Balance Sheet
was availed long term loans and of R1 for the yeaer
advances from R1 i.e. Kakade Estate ended 31st March, 2020.
Developers Private Limited amounting [Ref: Note 7 - Long
to approximately 85 Crore. [Ref: Para Term Loans and
13(c) @ page 109 of the Additional Advances. @ page 122,
Affidavit.] of the Disclosure
Affidavit of R1.]
4. R2 has granted loans and advances to Balance Sheet of R2 as
various group companies and associate on 31st March, 2020.
concerns amounting to approximately 76 [Ref: Schedule 8 - Long
crore. [Ref: Para No. 13(d) @ page 109 of and Loans and
the Additional Affidavit.] Advances (Assets). @
page 309, of the
Disclosure Affidavit of
R2.]
5. R3 has granted loans and advances to Balance Sheet of R3 as
various group companies and associate on 31st March 2020.
concerns amounting to approximately 34 [Ref: Schedule 7 -
crore. [Ref: Para 13(e) @ page 109 of the Loans and Advances
Additional Affidavit.] (Assets), @ page 214, of
Ganesh Lokhande page 8 of 13
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the Disclosure Affidavit
of R3]
8. Mr. Andhyarujina submitted that all this has been
categorically stated by the Applicants in their Additional Affidavit dated
4th April, 2022 and which was served on Respondent Nos. 1 to 5 on 5 th
April, 2022. Mr. Andhyarujina also pointed out that to defeat the
execution, Respondent Nos. 1 to 5 have gone to the extent of filing a
completely false Public Interest Litigation in this Court being PIL No. 12
of 2022. He submitted that though the Petitioner in the said PIL is some
third party, from the observations made by the PIL Court in its order
dated 10th October 2022, it is quite clear that it is the Kakades who are
really behind the said PIL to somehow stall and/or defeat and/or
obstruct the execution in the present proceedings as well as other
execution proceedings pending against them. He, therefore, submitted
that looking at the conduct of the Kakades, it is now time that the Court
Receiver be directed to sell the property of which he has been appointed.
He submitted that even if there is any dispute on the aspect of
distribution of the sale proceeds, that is something the Court can always
look into at a future date. However, this should not stop the Court
Receiver from proceeding to sell the said property.
Ganesh Lokhande page 9 of 13
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9. On the other hand, the learned advocate appearing on
behalf of Respondent Nos. 1 to 5, requested that connected matters are
coming up on 9th November, 2022 and therefore this matter also be kept
on the said date. She brought to my attention the affidavits filed in
Court today [dated 12th October, 2022] and submitted that with a view
to resolve the present disputes, Respondent Nos. 1 to 5 are attempting to
raise finance so that the decretal dues of the Applicants can be paid. She
submitted that Respondent Nos. 1 to 5 are in the midst of completing
the formalities of raising finances and on disbursement of the
loan/credit facilities, Respondent Nos. 1 to 5 shall endeavor to
make payment towards the Applicants' claims. She submitted that the
Respondents are making a genuine attempt to clear their dues but the
process of raising finances, given the due diligence required and the
ongoing discussions, has not yet materialised and would take another
period of six months. She, therefore submitted that looking to these
facts, and considering that the Receiver is already appointed, no further
order be passed directing the Receiver to sell the said property.
10. I have heard the learned counsel for the parties at length
and have perused the papers and proceedings in the above Interim
Application. It is not in dispute that an amount of Rs.121.77 Crores
together with interest is due and payable by Respondent Nos. 1 to 5 to
Ganesh Lokhande page 10 of 13
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the Applicants. They were supposed to pay this amount in installments
as set out in the Consent Terms dated 25 th November, 2020. Admittedly,
not a single installment has been paid by Respondent Nos. 1 to 5. It is
for this reason that the present Execution Application is filed. The
Consent Award passed on the basis of the Consent Terms has also
attained finality. In these circumstances, I fail to understand how
Respondent Nos. 1 to 5 can oppose sale of the property of which the
Receiver is appointed. It cannot be that after obtaining a decree in their
favour, the Applicants have to wait for years on end to realise the fruits
of their decree. In fact, the Hon'ble Supreme Court in the case of Rahul
S. Shah vs. Jinendra Kumar Gandhi [(2021) 6 SCC 418] , after noticing
the urgent need to reduce delays in execution proceedings have in fact
passed several directions as more particularly set out in paragraph 42 of
the said judgment. Those directions are to be followed by all Courts, is
the mandate of the Hon'ble Supreme Court. In the present case, there is
no defence raised. All that is sought once again, is an adjournment. I
must note that this very same argument was canvassed before this Court
[A. K. Menon, J] when he passed his order dated 8 th December, 2021. It
is because of this very argument that Justice Menon, at that time, and to
give an opportunity to Respondent Nos. 1 to 5 to raise the finances to
pay off the decretal dues of the Applicants, did not direct the Court
Receiver to sell the property of which he is appointed. Today, again after
Ganesh Lokhande page 11 of 13
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a period of 10 months, the exact same mantra is reiterated before me
and a further accommodation for period of 6 months is requested. I am
afraid this Court has shown enough indulgence to Respondent Nos. 1 to
5 and cannot keep adjourning the above matter and make the
Applicants wait to enjoy the fruits of their decree.
11. In view of the forgoing discussion, the Court Receiver shall
now proceed to sell the immovable property of Respondent No. 2 being
Survey Nos. 109, 114, 115/1, 116, 115/7, 115/5, 110, 115/8, 115/12, 119/1,
125/4, 115/13, 203, 202, 8/4, 8/5, 7/1, 8/1, 8/2, 8/3, 8/6, 130/B/1,
113/2, 143, 115/3, 105/4, 105/1, 111, 105/2, 109, 123/1, 130/2B, 125/3,
107, 108, 115/2, 115/6, 115/11, 118/2, 122/2, 124, 109, 106/1B, 106/1C,
7/3, 7/4, 106/2A and 106/1A situated within the Registration Sub-
District, Taluka- Mulshi, District Pune, Village - Bhugaon, Pune and
situate within the limits of Town Planning for Concerned Authority. To
take process of sale forward, the Court Receiver shall appoint a valuer
from this panel to value the said property. Once the valuation is done,
the Court Receiver shall file a report before this Court for fixing the
reserve price. It is made clear that the reserve price shall not be
disclosed to any party. Once the reserve price is fixed, the Court
Receiver shall seek further directions for advertisement etc. to take the
sale of the said property to its logical conclusion.
Ganesh Lokhande page 12 of 13
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12. This Court shall consider the grant of further reliefs in the
above Interim Application on 9th November, 2022. Stand over to 9th
November, 2022.
13. This order will be digitally signed by the Personal Assistant
of this Court. All concerned will act on production by fax or email of a
digitally signed copy of this order.
( B. P. COLABAWALLA, J. )
Ganesh Lokhande page 13 of 13
