Gujarat High Court
United Security Organization Pvt Ltd vs Official Liquidator Of Mardia Steels ... on 11 November, 2014
Author: N.V.Anjaria
Bench: N.V.Anjaria
O/COMA/242/2012 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
COMPANY APPLICATION NO. 242 of 2012
In
OFFICIAL LIQUDATOR REPORT NO. 110 of 2007
In
COMPANY APPLICATION NO. 187 of 2006
With
COMPANY APPLICATION NO. 40 of 2014
In
OFFICIAL LIQUDATOR REPORT NO. 110 of 2007
With
OFFICIAL LIQUDATOR REPORT NO. 78 of 2012
In
COMPANY PETITION NO. 104 of 2002
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UNITED SECURITY ORGANIZATION PVT LTD....Applicant(s)
Versus
OFFICIAL LIQUIDATOR OF MARDIA STEELS LTD (IN
LIQUIDATION)....Respondent(s)
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Appearance:
MRS SANGEETA N PAHWA, ADVOCATE for the Applicant(s) No. 1
MS AMEE YAJNIK, ADVOCATE for the Respondent(s) No. 1
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CORAM: HONOURABLE MR.JUSTICE N.V.ANJARIA
Date : 11/11/2014
COMMON ORAL ORDER
The applicant-security agency was engaged for keeping watch and take care of the properties of the company in liquidation. As per the case of the applicant, it was engaged during the period from 23.06.2003 to 26.05.2008. As per order dated 07.05.2008 passed in Official Liquidator Report No. 110 of 2007, the services of the applicant were discontinued, and another security agencies, at the relevant point of time, came to be engaged. In Company Page 1 of 9 O/COMA/242/2012 ORDER Application No. 242 of 2012, the applicant claimed payment towards the services rendered by it submitting that it was entitled to be paid to the tune of Rs.55,84,402/-. During the period of engagement of the applicant, the theft of the properties of the company took place. The claim for security charges of the applicant is being disputed and resisted in the wake of service charges of theft during the period of its engagement.
2. Learned advocate Mr. Pahwa submitted that pursuant to the orders passed by this court from time to time in the present proceedings, loss due to theft was assessed by the government approved valuer to the extent of Rs.1,73,700/-, which was revised by the GITCO and was put at Rs.1,99,755/-. It was submitted that the applicant is ready to forgo the said amount, even as it does not own responsibility for theft and denies the allegations of involvement in the theft occurred.
3. Various orders in the subject matter including order dated 03.07.2009 in Official Liquidator Report No. 110 of 2007 have highlighted the complexities in respect of the claim of the security agency and issued certain directions for appointment of committee and submitting the details by it.
4. One of the aspects highlighted by learned advocate for the official liquidator in response to the claim of the applicant that one Mr. Rasik Mardia, director of the company in liquidation has filed Page 2 of 9 O/COMA/242/2012 ORDER Company Application No. 90 of 2010, seeking an inquiry by C.B.I., alleging that the theft of the company properties was to the tune of Rs.65 crores.
4.1 Company Application No. 90 of 2010 is still pending. The following order dated 03.02.2011 passed therein deserves to be noticed:
"1. This judges summons is carried out by one Mr. Rasiklal S. Mardia, ExDirector of the Company in liquidation with following prayer:
"(a) to direct investigation against the office of the Official Liquidator and other responsible for the large scale loss of the assets to the tune of Rs.40 to 50 crores during the tenure, the Official Liquidator was possessing the assets of Mardia Steel Limited."
It is inter alia prayed to compensate for such loss and also to initiate contempt proceedings against the Official Liquidator and has further sought compliance of the various orders passed by this Court.
2. In respect of judges summons affidavit is filed by the applicant and it is submitted that initially by the order dated 23.7.2003 passed in the winding up petition, this Court passed an order and directed that charge of the assets etc. of the Company be taken over by the Official Liquidator and further the learned Company Judge on 3.8.2005 ordered winding up of Mardia Chemicals Limited and the plant at Mardianagar and Vatva were in possession of ICICI Bank Ltd. The Court further directed the Official Liquidator to keep a watch over the assets of the Company in the above two units and to protect the interest of Page 3 of 9 O/COMA/242/2012 ORDER workmen and secured creditors it is further submitted that due to wilful and noncompliance of the orders of this Court passed at various stages of the proceedings and in the OLR, particularly, OLR No. 110 of 2007, when a large force of 66 security guards, 6 security supervisors and 3 security officers were deployed, the loss assessed by Government Approved Valuer M/s. A. Dave and Co. and so concluded in the report dated 27 th January, 2010 that during the custody of office of Mardia Steel Limited by the Official Liquidator when the same is compared to the original inventory record while giving the possession in the year 2003, when the survey was carried out the loss on the basis of reinstatement value accounts the total book value of plant and accessories, electrical installation etc. is around to the tune of Rs.44.98 crores as compared to Rs.179.56 crores as on 30.1.2003. Mr. Rasiklal Mardia, partyinperson submitted that the appointment of M/s. A. Dave and Co. was of a surveyor and was the out come of the meeting and minutes recorded of the committee appointed by this Court and therefore, it can form the basis to words (determined) the responsibility and negligence of the Official Liquidator. Mr. Mardia has also referred to various orders passed by this Court of filing an explanatory note to the said report of M/s. A. Dave and Co. about loss and damages to the assets of the Company in liquidation and various affidavits filed in this regard by him.
3. Mr. Roshan Desai, learned counsel appearing for the Official Liquidator vehemently contended that the applicant has not made out any case before this Court to even fix any responsibility for the alleged loss and in fact any opinion of the meetings of the committee had not agreed to approve or sanction the appoint of Page 4 of 9 O/COMA/242/2012 ORDER M/s. A. Dave and Co. , surveyor to carry out the loss as asked for. It is further submitted that in fact initially Mr. A. Dave and Mr. Vinod Trivedi both Government Approved Surveyors were to carry out and assess the loss alleged but later on Mr. Trivedi had backed out and no report is submitted for the loss of the assets. It is further submitted that earlier Mr. Mardia has fixed the liability of security agency for the loss of assets etc. and now cast the allegations on the Official Liquidator or the staff of Official Liquidator, is not just and proper. Besides, for the loss of assets/inventories, criminal complaint have already been filed and the Official Liquidator has taken utmost care to protect the properties and sister concern of the Company in liquidation in which this application is filed. So far as Mardia Chemicals is concerned, the Court Receiver is appointed and without seeking permission of the High Court of Mumbai it is not possible for the O.L. or its representatives to pass through the property. Mr. Desai has further disputed and contended method of assessment of loss of M/s. A. Dave and Co. and has offered that any Government Approved surveyor/assessor/valuer is suggested by this Court or appointed by this Court, the O.L. is ready and willing to undertake a survey and also to verify the correctness and validity of the loss as assessed by M/s. A.Dave and Co.
4. Ms. Sangeeta Pahwa, learned counsel for the security agency has vehemently opposed maintainability of this application at the behest of ExDirector of the Company who himself is responsible for the state of affairs of the Company and submitted that when the security agency came into charge the loss of the assets was only in lakhs of ruppees and for that security agency cannot be fixed with any liability.
Page 5 of 9O/COMA/242/2012 ORDER
5. I have also heard learned advocate for respondent No.2.
6. Upon perusal of the affidavits filed and the explanatory note submitted on 2nd February, 2011, the O.L. in para 8 submitted as under:
"8. With further reference to the affidavit Liquidator submits that
(a) Explanation is already given by the Deponent of the Affidavit at Page 21 of the Paper Book as to who has cause the Loss. The same reads as under:
"It can be concluded that for other losses of assets of Mardia Steel Ltd. Security Agency may be more responsible apart from overall responsibility of the Official Liquidator."
(b) In the minutes of the meeting of the Committee held on 55 th March 2010 produced at page 248 and 249 in para 3 it is recorded "Representative of Security Agency admitted that they are accountable for the Loss of the property of the Company.."
(c) At page 266 of the Paper Book Deponent of the affidavit in para (e) has stated as under:
" ARCIL appears to have the view point that value of the huge machineries lying at various units of the Company is negligible, in fact also support our contention that there is a large scale thefts and loss to the valuable Plant and machineries caused during the time of the Official Liquidator. The major valuable electrical fittings and electronics of the Plant and machineries have been systematically siphoned of with the active involvement of the Security agencies and the Plant and machineries have only remained skeletons without the brains therefore loss to the Plant and machineries is major in value."
6.1. To the above explanatory note, no reply or rejoinder is filed and the partyinperson has chosen to submit orally while reiterating his submissions about loss and damage to the plant and machinery and other assets of the Company for which the O.L. is responsible.
Page 6 of 9O/COMA/242/2012 ORDER
7. On perusal of relevant records, submissions as above and pleadings, I am of the view that the assessment/survey carried out by M/s. A. Dave and Co. was exclusively at the behest of the applicant herein, who paid for the charges of the surveyor and another surveyor has not submitted his report. However, at the same time when ARCIL has taken over possession of the properties in question of the liquidated Company somewhere in February or March, 2010 under Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, I am of the opinion that a fresh and a new survey of the loss and damages of assets of the Company in liquidation is to be carried out to verify the veracity of the report submitted by M/s. A. Dave and Co. and fixation of the basis of the loss of assets by the said surveyor, I direct the O.L. to furnish three names of the qualified government approved valuer within seven days from today so that appropriate order can be passed. Stand over to 21st February, 2011."
4.2 Similarly, on 21.06.2011, following order is passed:
"Heard the learned counsels for the parties and party in person present in the Court.
Pursuant to the order dated 21.03.2011, OL has filed report on 18.02.2011. In para 1 of the said report it is submitted that as per the order dated 28.02.2010 passed in OLR No.69 of 2010 the office of the OL maintains a list of approved panel valuers.
In the above, names of three approved valuers are suggested to which none of the party has any objection, if this court directs any one of those three approved valuers to carry out valuation report so far as inventory of plant and machinery and other items of the Page 7 of 9 O/COMA/242/2012 ORDER company in liquidation is concerned.
Considering the overall facts and circumstances of the case, I am inclined to appoint GITCO as a valuer to carry out inventory / valuation of the plant and machinery and other items of the company in liquidation as earlier as possible and preferably on or before 16.08.2011.
S.O. to 16.08.2011."
5. Above are the various dimensions of the matter which are required to be gone into by looking to the relevant facts. At this stage, therefore, before the matter proceeds further, it is directed that,
(i) The official liquidator shall file report indicating, (a) the amount which may have been calculated towards the dues of the applicant-security agency by the creditors, or by any other person, (b) the details which the official liquidator would have received from the applicant-security agency corresponding to the statement at page-88 of the compilation, (c) the earlier orders which may been passed by the company court in past relating to the engagement of the security agency, and fixation of rates/charges payable to the applicant agency, d) the status and progress of Company Application No. 90 of 2010, (e) any other details which may be considered relevant.
(ii) Either of the parties are at liberty to file further pleadings in the matter.
6. Put up the matters on 1st December, 2014.
Page 8 of 9 O/COMA/242/2012 ORDER
(N.V.ANJARIA, J.)
chandrashekhar
Page 9 of 9