Delhi High Court - Orders
Citicrop Finance (India) Limited vs Prime Telesystems Ltd. & Ors on 2 March, 2023
Author: Prateek Jalan
Bench: Prateek Jalan
$~14
* IN THE HIGH COURT OF DELHI AT NEW DELHI
CRL.M.A. 21970/2022, EX.APPLs.(OS) 1327/2021, 251/2022
+ EX.P. 5/2008 (Disposed off case)
CITICROP FINANCE (INDIA) LIMITED ..... Decree Holder
Through: Mr. Sonal Kumar Singh, Mr. Anish
Jaipuriar, Mr. Suhel Qureshi,
Advocates.
versus
PRIME TELESYSTEMS LTD. & ORS ..... Judgement Debtors
Through: Mr. Lovkesh Sawhney, Sr.
Advocate with Mr. Vibhor Kush,
Mr. Rohit Kumar, Advocates for
JD-1.
CORAM:
HON'BLE MR. JUSTICE PRATEEK JALAN
ORDER
% 02.03.2023
1. The present execution proceedings were disposed of by an order dated 03.03.2020 in terms of a Settlement Agreement dated 26.02.2020.
2. Citicorp Finance (India) Limited, has filed EX.APPL.(OS) 1327/2021 for revival of the proceedings in view of non-compliance by the judgment debtors.
3. The judgment debtors have filed CRL.M.A. 21970/2022 under Section 340 of Code of Criminal Procedure, 1973 in which it is alleged that the company which has filed the application for revival of the execution petition is not the original execution petitioner but another company of the same name.
4. Mr. Sonal Kumar Singh, learned counsel for the applicant in Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:04.03.2023 12:41:45 EX.P. 5/2008 Page 1 of 4 EX.APPL.(OS) 1327/2021, submits that the original decree holder, also called "Citicorp Finance (India) Limited", was merged with the present applicant which was then called "Citi Financial Consumer Finance (India) Ltd." and its name was subsequently changed to "Citicorp Finance (India) Limited". It is his submission that all rights and liabilities of the original decree holder have been assigned to the present applicant by virtue of the scheme of amalgamation.
5. Although the applicant, in its reply to CRL.M.A. 21970/2022, has filed the order of this Court dated 18.11.2013 in CO.PET. 447/2013 by which the scheme of amalgamation was sanctioned, it is directed that the scheme itself must also be placed on record by way of an affidavit within four weeks.
6. At this stage, suffice it to say that even if the applicant-company had succeeded to the rights and liabilities of the original decree holder, the Court ought to have been informed of the same, and an application for substitution of the original decree holder/ execution petitioner with the present applicant ought to have been made. Although the present applicant now bears the same name as the original decree holder, the admitted facts placed on record show that it is, in fact, a different legal entity.
7. That said, subject to perusal of the terms of the scheme, it also appears that the liability of the judgment debtors would remain unchanged by reason of the amalgamation. The judgment debtors cannot evade their liability on account of an irregularity of this nature committed by the decree holder or its assignee.
8. The Settlement Agreement provides for payment of ₹4.25 crores by Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:04.03.2023 12:41:45 EX.P. 5/2008 Page 2 of 4 the judgment debtors to the decree holder in various instalments as provided therein. However, it is also provided that, after the upfront payment of ₹50 lakhs, the decree holder is required to dematerialise the shares which are the subject matter of the award under execution, and after receipt of entire sum of ₹4.25 crores, the decree holder is liable to transfer the same to the nominee of the judgment debtor No. 1 or to its ESOP Trust.
9. In the affidavit to be filed by it, the applicant will also state whether it is in a position to have the shares dematerialised and transferred as required by paragraphs (v) and (vi) of the Settlement Agreement.
10. Judgment debtor No. 1 has filed its affidavit of assets dated 22.02.2022. Judgment debtor Nos. 2 and 3 are directed to file their current affidavit of assets in terms of Form 16A of Appendix E Order XXI Rule 41 (2) of the Code of Civil Procedure, 1908.
11. The judgment debtors, at this stage, are also directed to deposit with the Registry of this Court the upfront of payment of ₹50 lakhs as required under the Settlement Agreement dated 26.02.2020, which was required to be paid even prior to dematerialisation of the shares. The amount will be deposited with the learned Registrar General of this Court within four weeks and kept in a fixed deposit subject to further orders of the Court.
12. At the request of Mr. Lovkesh Sawhney, learned Senior Counsel for the judgment debtor No. 1, it is directed that as an alternative to deposit of the amount of ₹50 lakhs, the judgment debtors may submit an unconditional and irrevocable bank guarantee to the satisfaction of the Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:04.03.2023 12:41:45 EX.P. 5/2008 Page 3 of 4 learned Registrar General of this Court for the said sum within four weeks, which may be invoked in accordance with the orders of the Court.
13. List on 12.07.2023.
14. Interim orders to continue.
PRATEEK JALAN, J MARCH 2, 2023 'Bhupi'/ Signature Not Verified Digitally Signed By:SHITU NAGPAL Signing Date:04.03.2023 12:41:45 EX.P. 5/2008 Page 4 of 4