Delhi High Court
Morgan Securities & Credits Pvt ... vs Bpl Ltd & Anr. on 18 December, 2018
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Reserved on: 11.09.2018
Date of decision : 18.12.2018
+ CCP(O) 5/2017 & CCP(O) 35/2017 in ARB.A. 14/2015
MORGAN SECURITIES & CREDITS PVT LTD ..... Appellant
Through Mr.K.Dutta and Mr.Simran Mehta,
Advs.
versus
BPL LTD & ANR. ..... Respondents
Through Mr.Parag Tripathi, Sr. Adv.with
Mr.Dhananjay Joshi,
Mr.G.Umapathy, Ms.R.Mekhala
and Mr.Aditya Singh, Advs.
CORAM:
HON'BLE MR. JUSTICE NAVIN CHAWLA
1. The appellant has filed the above petitions under Section 2(b) of
the Contempt of Courts Act, 1971 seeking initiation of proceedings under
the Contempt of Courts Act, 1971 and imposition of punishment on the
respondents for having willfully violated the injunction order dated
23.08.2013 passed by this Court in Arb.P. No.362/2013 (renumbered as
Arb. Appeal No.14/2015).
2. This Court by the order dated 23.08.2013 had restrained M/s BPL
Ltd. 'from creating any third party interest in the balance 51% shares
held by it in BPL Medical Technologies Pvt. Ltd.' (hereinafter referred
to as 'BMTPL').
CCP(O) Nos.5 & 35/2017 Page 1
3. It is the case of the petitioner and not denied by the respondents
that in spite of the said order, M/s BPL Ltd. reduced its shareholding in
BMTPL to a mere 20.54% as on 31.03.2016, resulting in filing of
CCP(O) No.5/2017, and further to 15.88%, thereafter, resulting in filing
of CCP(O) No.35/2017.
4. The respondent no.1 has filed its reply wherein it is submitted that
BPL Ltd. held 2,10,50,000 shares in BMTPL amounting to 48%
shareholding in that company. A group Company namely Electro
Investment Pvt. Ltd. (hereinafter referred to as 'EIPL') held 13,15,625
shares in BMTPL amounting to 3% shareholding in that company,
making a total of 51% shareholding in BMTPL. In July, 2014, BMTPL
required funds and therefore, its subscribed share capital was increased
and the shareholders were required to contribute funds in proportion of
their respective shareholding. However, as BPL Ltd. did not have the
requisite funds, it did not participate in that round of funding by the
shareholders. M/s Goldman Sachs, the Investor shareholder, invested a
further sum of Rs.58.80 crores and consequently was allotted fresh shares
by BMTPL and its shareholding increased to 65.78%. It is stated that
M/s BPL Ltd. along with EIPL continued to hold 2,23,65,625 shares in
BMTPL.
5. It is further asserted that in October, 2015, again BPL Ltd. did not
participate in further offer of shares in BMTPL, because of which the
investor's shareholding changed to 65.32%, while a new investor, namely
Pan India Telecommunication Network Pvt. Ltd., invested a sum of
Rs.36 crores and was allotted 12.85% shareholding in BMTPL. Further,
CCP(O) Nos.5 & 35/2017 Page 2
investments have been called by BMTPL in March 2017, May 2017 and
in December 2017, resulting in the change in percentage of shareholding
of M/s BPL Ltd, however, M/s BPL Ltd. continues to hold the same
number of shares in BMTPL and therefore, it is not in violation of the
interim order passed by this Court.
6. Learned senior counsel for the respondents has submitted that as
the number of shares held by M/s BPL Ltd. in BMTPL have remained the
same and no third party interest has been created by M/s BPL Ltd.
therein, therefore, there is no violation of the order dated 23.08.2013 of
this Court. He submits that the order dated 23.08.2013 did not mandate
M/s BPL Ltd. to continue holding 51% shares in BMTPL but merely
restrained the respondent from creating any third party interest in the
shares held by it. Relying upon the judgments of the Supreme Court in
T.C.Gupta vs. Bimal Kumar Dutta & Ors., (2014) 14 SCC 446 and
Sushila Raje Holkar vs. Anil Kak, (2008) 14 SCC 392, he submits that
even if it is held that the order dated 23.08.2013 mandated M/s BPL Ltd
to maintain its shareholding at 51% in BMTPL, the said order being
ambiguous and reasonably capable of two interpretations, no contempt
can be made out.
7. I am unable to agree with the submission made by the learned
senior counsel for the respondents. The order dated 23.08.2013 is
absolutely clear and unambiguous. It restrains M/s BPL Ltd. from
creating any third party interest in 51% shares held by it in BMTPL. The
Court made specific reference to the percentage shareholding held by M/s
BPL Ltd. in BMTPL as the same has vital significance on the control of
CCP(O) Nos.5 & 35/2017 Page 3
the company, that is BMTPL. The Court was not referring to the number
of shares simplicitor, but to such controlling interest. It is not denied by
the respondents that the respondents held a controlling interest in
BMTPL as on the date of passing of the said order. Therefore, increase
in subscribed share capital of the BMTPL could not have been done
without the concurrence and consent of M/s BPL Ltd. Such increase in
subscribed share capital in favour of the third parties was clearly to
achieve the objective of hiving off BMTPL from the control of M/s BPL
Ltd.
8. It is of significance to note that this Court was not even informed,
leave alone permission sought of this Court for allowing dilution of the
controlling interest of M/s BPL Ltd. in BMTPL.
9. I therefore, find the contemnors guilty of having intentionally
violated the interim order dated 23.08.2013 passed by this Court in Arb.
P. No.362/2013 (re-numbered as Arbitration Appeal No.14/2015) and
thereby having committed Contempt of Court. Notice is therefore issued
to the respondents calling upon them to show cause on the quantum of
punishment under Section 12 of the Contempt of Courts Act, 1971. Such
show cause be filed within a period of four weeks.
List on 14th February, 2019.
NAVIN CHAWLA, J
DECEMBER 18, 2018
RN
CCP(O) Nos.5 & 35/2017 Page 4
