Bombay High Court
Matrix Partners India Investment ... vs Shailendra Bhadauria And 6 Others on 1 March, 2019
Author: K.R.Shriram
Bench: K.R.Shriram
1/7 3.CHSCD1030.18.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
CHAMBER SUMMONS NO.1030 OF 2018
IN
EXECUTION APPLICATION (L) NO.2113 OF 2018
Matrix Partners India Investment )
Holdings LLC and Ors. )....Claimants/Applicants
V/s.
Shailendra Bhadauria & Ors. )....Respondents
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Mr.Sharan Jagtiani a/w Mr.Nitesh Jain, Ms.Juhi Mathur and Ms.Atika Vaz I/by Shardul Amarchand Mangaldas for Claimants/Applicants. Mr.Prashant Pratap, Senior Advocate a/w Mr.Kumar Abhishek, Mr.P.Srinivasan , Mr.A.Mehan Raj and Mr.Samsher Garud I/by Jayakar and Partners for respondent nos.1 to 4. Mr.Prathamesh Kamat a/w Ms.Anchal Singhania, Mr.Nivit Srivastava and Ms.Sneha Patil I/by Maniar Srivastava Associates for respondent nos.5 to 7.
[Respondents appearance as per attendance sheet enclosed].
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CORAM : K.R.SHRIRAM,J DATE : 1.3.2019 P.C.:-
1. On the last occasion, some of the respondents appeared.
Mr.Shailendra Bhadauria-respondent no.1 and the Promoter and key person behind the respondents nos.3 to 7 trust etc. informed the Court through his Counsel that he cannot come on 1.3.2019. The Court had made it very clear to the counsel of Shailendra Bhadauria that he shall KJ ::: Uploaded on - 06/03/2019 ::: Downloaded on - 12/03/2019 21:30:02 ::: 2/7 3.CHSCD1030.18.doc remain present in Court on 1.3.2019. Counsel, Mr.Jain, had said that respondent no.1 has some other prior engagement and therefore, he will not be coming. The Court said the Courts' order is of utmost importance and parties should respect Courts' orders and as 1st March 2019 was convenient to the Court and also all Counsel, no exemption will be granted. It was also noted that Shailendra Bhadauria and other respondents had appeared in Court only after their Counsel were told on previous occasion that arrest warrant will be issued, i.e., only when they were threatened with arrest, appeared in Court. In fact, counsel also agreed and told the Court that it is everybody's duty to obey orders of the Court. I have to mention respondents were directed by an order dated 29th October 2018 to remain present in Court. On 1st November 2018, again an order was passed directing respondents to remain present in Court. On 10th December 2018 matter was stood over to 20th December 2018 and respondents were directed to remain present.
2. On 24th January 2019, the following order came to be passed :-
"1. Mr.Jagtiani, at the outset states that respondents have not complied with the directions of the court and in fact committed breach of the orders passed by this court. Mr.Jagtiani also stated that applicants have filed affidavits, copies of which have been served upon the KJ ::: Uploaded on - 06/03/2019 ::: Downloaded on - 12/03/2019 21:30:02 ::: 3/7 3.CHSCD1030.18.doc respondents on 14th December, 2018 and 21st January, 2019.
2. Counsel appearing for respondent nos.1 to 4 requested for sometime to consider the affidavits, one of which has been served on 21st January, 2019. At the same time, counsel also stated that respondents by not remaining present in court have not complied with the directions of the court but he assures that his clients will strictly comply with the directions of this court and uphold the majesty of the court and his clients will remain present in court.
3. Mr.Jain appearing for respondent nos.5 to 7 states that it is true that there has been non compliance of the orders of this court and further assures that the trustees/committee members/those persons in charge who are running each of the institutions, shall remain present in court on the next date.
4. Respondents/each of the directors/each of the committee members/trustees shall remain present in court on the next date with proof of identify and photocopy thereof to be submitted to the court.
5. Mr.Jain also submitted that respondent no.5 is ready to secure applicants' claim to the extent of the orders passed in arbitration proceedings and gives a copy of affidavit being filed on behalf of respondent no.5 including therein the un-encumbered assets of respondent no.5, which can be secured to protect the interest of claimants.
6. Mr.Jagtiani states that he will raise his submissions on the offer by next date.
7. Parties to complete filing of affidavits and exchanging the same on or before 2nd February, 2019. Response affidavits, if required, to be filed and exchanged by 8 th February, 2019.
8. Stand over to 14th February, 2019 at 3.00 p.m."
(emphasis supplied) KJ ::: Uploaded on - 06/03/2019 ::: Downloaded on - 12/03/2019 21:30:02 ::: 4/7 3.CHSCD1030.18.doc Thereafter on 14.2.2019, the following order came to be passed :-
"1. Part heard.
2. All the persons who are present today, shall remain present on the next date as well, without fail.
3. Stand over to 1.3.2019 at 3.00 P.M. The Attendance Lists are taken on record and marked `X colly'. Respondent no.1 and respondent no.2 are also present in Court."
3. Despite this, respondent no.1-Shailendra Bhadauria who is the main person for respondent nos.3 to 7 has chosen not to remain present in Court today. The matter being considered is under Order 21 Rule 41 for non disclosure despite orders of the court and respondent no.1 is the main person responsible with the management of all other respondents, companies and trusts.
4. Mr.Pratap, senior Counsel appearing today for respondent no.1 to respondent no.4 stated that Mr.Shailendra Bhadauria, he has been instructed to say, has a torn ligament and tenders an undated purported Doctor's hand written certificate in which it is stated that Mr.Shailendra Bhadauria was suffering from knee rupture and he has been advised rest for four weeks. The purported certificate does not KJ ::: Uploaded on - 06/03/2019 ::: Downloaded on - 12/03/2019 21:30:02 ::: 5/7 3.CHSCD1030.18.doc say he has been advised bed rest or that he is rendered immobile. He could have therefore, come to court. Going by the past conduct of respondent no.1 to respondent no.4, their failure to make full and complete disclosure and disposing assets despite there being orders of injunction, I am unable to accept the contents of this certificate or the certificate as genuine. Respondents had dealt with about 12 properties after the 20th August 2018 order. Paragraphs-2 & 3 of order dated 29th October 2018 reads as under :-
"2. According to Mr.Jagtiani for the Applicants in Execution ("Matrix") these Affidavits are firstly inaccurate and secondly show a wilful defiance of orders of this Court and of the Arbitral Tribunal. To recapitulate briefly, the Arbitral Tribunal made an interim order for deposit of Rs.190 crores within four weeks or alternatively for the furnishing of a bank guarantee. There were also orders of injunction and of disclosure by the Arbitral Tribunal. The Respondents filed an Appeal. In the meantime, I continued the injunctions and ordered disclosures on 28th August 2018. The Respondents' Appeal was dismissed. Mr.Jagtiani points out that there was non-compliance with my order of 20th August 2018 and that the 5th Respondent in particular had, after the date of that order, purported to transfer two properties to third parties for a consideration of Rs.7.5 lakhs and Rs.7.10 lakhs. I ordered that amount to be brought back in Court. This was done on 24th October 2018 when Mr.Samdani now appearing for Respondents Nos.5 to 7 deposited a demand draft of Rs.14.60 lakhs in this Court.
3. Today Mr.Jagtiani points out that these are not the only two properties transacted after the 20th August 2018 order. Pages 142 to 143 show that an additional ten properties were so transacted, with no explanation KJ ::: Uploaded on - 06/03/2019 ::: Downloaded on - 12/03/2019 21:30:02 ::: 6/7 3.CHSCD1030.18.doc provided. The aggregate of the transaction values for these 12 properties is Rs.67.10 lakhs and this, Matrix says, is clearly an undervaluation. In an aggregate, according to Matrix, as many as 42 properties have been transferred out for Rs.2.44 crores after the Arbitral Tribunal's order of 24th April 2018. Mr.Jagtiani is at some pains to point out that one particular property shown as Arzi No.423, said to be owned by the 5 th Respondent (in its disclosures of immovable property), has been sold on the very date that I passed the order of injunction. It is also stated that the 5th Respondent has transacted amounts worth Rs.4.3 crores since the date of the injunction with withdrawal of nearly Rs.60 lakhs and that the 3rd Respondent has transacted Rs.2,12,634/-. The point is not to whom these payments were made but whether they can be legitimately explained as being in the ordinary and usual course of business."
(emphasis supplied)
5. The doctor who is supposed to have issued the certificate, Dr.A.N.Sarswad, M.S. (Ortho), shall remain present in Court on the next date with (a) his proof of identity ; (b) that he is part of Mahavir Hospital & Trauma Center and (c) copies of his certificates showing his educational qualifications. If Dr.A.N.Sarswad does not remain present with documents as mentioned, the medical certificate submitted today will be considered as fake certificate. A copy has been given to Mr.Jagtiani, who stated the claimants shall also make independent enquiry on the doctor and seeks leave. Leave granted.
6. The matter therefore, is adjourned to 22.3.2019. For KJ ::: Uploaded on - 06/03/2019 ::: Downloaded on - 12/03/2019 21:30:02 ::: 7/7 3.CHSCD1030.18.doc disobeying the order of this Court by not remaining present despite specific directions and for today's adjournment, Mr.Shailendra Bhadauria shall pay sum of Rs.10,00,000/- (Rupees Ten Lakhs only) as donation to Tata Memorial Hospital, Parel, Mumbai and this amount to be paid by 15.3.2019 and the proof of payment shall be forwarded to the Advocate for the applicants.
7. In addition to that, applicants to be paid sum of Rs.2,00,000/- as costs for today's adjournment and this amount to be paid by Mr.Shailendra Bhadauria by way of cheque drawn in favour of applicant's Advocate and the amount shall be paid on or before 15.3.2019.
If these two amounts are not paid, defence of none of the respondents may not be considered at all.
8. All respondents shall remain present in Court along with the said Dr.A.N.Sarswad on 22.3.2019.
On the next date, all respondents who have appeared on 14.2.2019 shall also bring their passports to this Court.
(K.R.SHRIRAM,J) KJ ::: Uploaded on - 06/03/2019 ::: Downloaded on - 12/03/2019 21:30:02 :::