Karnataka High Court
Idbi Trusteeship Services Limited vs Sbicap Trustee Company Limited on 14 September, 2022
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 14TH DAY OF SEPTEMBER, 2022
BEFORE
THE HON'BLE MR. JUSTICE R. NATARAJ
WRIT PETITION NO.50238/2014 (GM-CPC)
C/W
WRIT PETITION NO.51582/2014 (GM-CPC)
WRIT PETITION NO.53330/2014 (GM-CPC)
WRIT PETITION NO.53448/2014 (GM-CPC)
IN W.P.NO.50238/2014:
BETWEEN:
1. IDBI TRUSTEESHIP SERVICES LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
ASIAN BUILDING, 17,
R.KAMANI MARG, BALLARD ESTATE,
MUMBAI-400001
REPRESENTED BY ITS AUTHORISED SIGNATORY
MR. OMKAR DILIP BANDRE
2. INDIAN GLOBAL COMPETITIVE FUND
A DEBT FUND REGISTERED AS A TRUST UNDER
THE INDIAN TRUSTS ACT, 1882,
HAVING ITS OFFICR AT
86 C, TOPISA ROAD (SOUTH)
KOLKATA-700046
REPRESENTED HEREIN BY ITS
AUTHORISED REPRESENTATIVE
MR. SUPRIYO GOLE
3. SREI ALTERNATIVE INVESTMENT MANAGER LTD.,
A COMPANY INCORPORATED UNDER
THE PROVISIONS OF THE COMPANIES ACT, 1956
2
HAVING ITS REGISTERED OFFICE AT
INVESTMENT MANAGER
INDIAN GLOBAL COMPETITIVE FUND
86 C, TOPSIA ROAD (SOUTH),
KOLKATA-700046
REPRESENTED HEREIN BY ITS
AUTHORISED REPRESENTATIVE
MR.SUPRIYO GOLE.
...PETITIONERS
(BY SRI. DHYAN CHINNAPPA, SENIOR COUNSEL A/W
SMT. MEENAKSHI K.K., ADVOCATE)
AND:
1. SBICAP TRUSTEE COMPANY LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT 1956
HAVING ITS REGISTERED TOWER AT
202, MAKER TOWN E CUFF PARADE
MUMBAI-400005
REPRESENTED BY ITS
CHIEF OPERATIONS OFFICER
MR. V.G.PAATHAK
2. STATE BANK OF INDIA
A BANKING CORPORATION CONSTITUTED UNDER
THE STATE BANK OF INDIA ACT, 1955 (23 OF 1955)
HAVING ITS CORPORATION CENTRE AT
STATE BANK BHAVAN, MADAMA CAMA ROAD,
NARIMAN POINT, MUMBAI-400021
AND HAVING ITS INDUSTRIAL FINANCE BRANCH AT
61, RESIDENCY PLAZA, RESIDENCY ROAD
BENGALURU-580 085.
3. AXIS BANK
A COMPANY REGISTERED UNDER
THE COMPANIES ACT, 1956 AND
A BANKING COMPANY WITHIN
THE MEANING OF SECTION 5(C) OF
THE BANKING REGULATION ACT, 1949
AND HAVING ITS REGISTERED OFFICE AT
3
TRISHUL, THIRD FLOOR
OPP. SAMARTESHWAR TEMPLE, LAW GARDEN,
ELLIS BRIDGE, AHEMDABAD-380086,
GUJARAT, INDIA AND
HAVING ITS CORPORATE OFFICE AT
AXIS HOUSE, C-2, WADIA INTERNATIONAL CENTER
PANDURANG BUDHKAR MARG, WORLI,
MUMBAI-400025.
4. BANK OF BARODA
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT 1970 (5 OF 1970)
HAVING ITS HEAD OFFICE AT
BARODA HOUSE, P.B.NO.506,
MANDAVI, VADODRA-396006.
ACTING THROUGH ITS BRANCH OFFICE AT
P.O. BOX 1745, SAMANTHA BUILDING,
GENERAL BHOSALE MARG,
NARIMAN POINT, MUMBAI-400021.
5. BANK OF INDIA
A BODY CORPORATE CONSTITUTED UNDER
BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDER TAKING) ACT, 1970
HAVING ITS HEAD OFFICE AT
STAR HOUSE, C 5, G BLOCK,
BANDRA, KURLA COMPLEX,
BANDRA (E) MUMBAI-400051
AND HAVING ITS LARGE CORPORATE BRANCH AT
GROUND FLOOR, ORIENTAL BUILDING,
364, DN ROAD, FORT, MUMBAI-400001.
6. CENTRAL BANK OF INDIA
A BODY CORPORATE CONSTITUTED UNDER
BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDER TAKING) ACT, 1980,
HAVING ITS CORPORATE OFFICE AT
CHANDRAMUKHI, GROUND FLOOR,
NARIMAN POINT, MUMBAI-500021
4
7. CORPORATION BANK
A BODY CORPORATE CONSTITUTED UNDER
BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDER TAKING) ACT, 1980,
HAVING ITS CORPORATE OFFICE AT
MANGLADEVI TEMPLE ROAD,
PANDESHWAR, MANGALORE-575 001
AND HAVING ITS INDUSTRIAL FINANCE BANK AT
RALLAROAM MEMORIAL BUILDING,
1ST FLOOR, CSI COMPOUND,
MISSION ROAD, BENGALURU-560 027.
8. THE FEDERAL BANK LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
FEDERAL TOWERS,
ALUVA-683 101, KERALA
AND HAVING ITS BRANCH OFFICE AT
44 AND 45, RESIDENCY ROAD,
BENGALURU -560 025.
9. IDBI BANK LTD.,
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
AND A BANKING COMPANY WITHIN THE
MEANING OF BANKING REGULATION ACT, 1949
HAVING ITS HEAD OFFICE AT
IDBI TOWER, WTC COMPLEX,
CUFFE PARADE, MUMBAI-400005
MAHARASHTRA, INDIA
AND ACTING THROUGH ITS BRANCH OFFICE AT
CORPORATE BANKING GROUP
FAMG, 9TH FLOOR, IDBI TOWER,
WTC COMPLEX, CUFFE PARADE,
COLABA, MUMBAI-400005.
10. INDIAN OVERSEAS BANK
A BODY CORPORATE CONSTITUTED UNDER
BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING ) ACT, 1970
HAVING ITS HEAD OFFICE AT
5
763, ANNA SALAI, CHENNAI-600002
AND ITS BRANCH OFFICE AT
'HARIKRIPA', 26 A, S.V.ROAD,
SANTACRUZ (W), MUMBAI-400054.
11. PUNJAB AND SIND BANK
A BODY CORPORATE CONSTITUTED UNDER
BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING ) ACT 1980
HAVING ITS CORPORATE OFFICE AT
21, RAJENDRA PLACE,
NEW DELHI-110008
AND HAVING AMONGST OTHERS A BRANCH OFFICE AT
J.K. SOMANI BUILDING,
BRITISH HOTEL LANE, FORT,
MUMBAI-400023.
12. PUNJAB NATIONAL BANK
A BODY CORPORATE UNDER
BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING ) ACT, 1970 (5 OF 1970)
HAVING ITS HEAD OFFICE AT
7, BHIKAJ CAMA PLACE,
NEW DELHI-110066
ACTING THROUGH ITS LARGE CORPORATE BRANCH AT
CENTENARY BUILDING, 28,
M.G.ROAD, BENGALURU-560 001.
13. STATE BANK OF MYSORE
A BODY CORPORATE UNDER
THE STATE BANK OF INDIA (SUBSIDIARY BANKS) ACT,
1959,
HAVING ITS HEAD OFFICE AT
KEMPE GOWDA ROAD,
BENGALURU-560 009
AND ITS CORPORATE ACCOUNTS BRANCH AT
NO.19, RAMANASHREE ARCADE,
M.G.ROAD, 500001.
14. UCO BANK
A BODY CORPORATE UNDER
6
BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING ) ACT, 1970
HAVING ITS HEAD OFFICE AT
10, BTM SARANI, KOLKATA-700001
WEST BENGAL, INDIA
AND ITS BRANCH OFFICE AT
1ST FLOOR, 13/22, K.G.ROAD,
BENGALURU-560 009.
15. UNITED BANK OF INDIA
A BODY CORPORATE UNDER
BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING ) ACT, 1970 (5 OF 1970)
HAVING ITS HEAD OFFICE AT
11, HEMANTA BASU SARANI,
KOLKATA-7000D01
ACTING THROUGH ITS BANK AT
40, KG ROAD, BENGALURU-560 009
RESPONDENTS 2 TO 15 REPRESENTED BY
MR. S.RANGA VITTAL
ASSISTANT GENERAL MANAGER AND
RELATIONSHIP MANAGER-AMT IV,
STATE BANK OF INDIA
HAVING ITS INDUSTRIAL FINANCE BRANCH AT
61, RESIDENCY PLAZA,
RESIDENCY ROAD,
BENGALURU-580 025.
16. KINGFISHER AIRLINES LTD.,
A PUBLIC LIMITED COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
UB TOWER, LEVEL 12,
UB CITY 24, VITTAL MALLYA ROAD,
BANGALORE-560 061.
REPRESENTED HEREIN BY ITS DIRECTOR.
17. UNITED BREWERIES (HOLDINGS) LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
7
UB TOWER, LEVEL 12, UB CITY 24,
VITTAL MALLYA ROAD,
BANGALORE-560 061.
REPRESENTED HEREIN BY ITS DIRECTOR.
18. KINGFISHER FINVEST (INDIA) LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
C/O PARSONS PVT. LIMITED,
ASIAN BUILDING, J.N.HERDIA ROAD,
BALLARD ESTATE, MUMBAI-400038.
REPRESENTED HEREIN BY ITS DIRECTOR.
...RESPONDENTS
(BY SRI. G. KRISHNAMURTHY, SENIOR COUNSEL A/W SRI.
VEERENDRA PATIL, ADVOCATE FOR RESPONDENT NOS.1 TO 14
AND 7 TO 15;
SRI. VIVEK HOLLA, ADVOCATE FOR RESPONDENT NO.17;
NOTICE SERVED ON RESPONDENT NO.18;
VIDE ORDER DATED 01.07.2019 IN W.P.NO.42492-943/2016,
NOTICE ON BEHALF OF OFFICIAL LIQUIDATOR ACCEPTED BY
SRI. SRISHAIL NAVALGUND)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO SET
ASIDE THE IMPUGNED ORDER DATED 15.10.2014 PASSED BY
THE HON'BLE XXVIII ADDITIONAL CITY CIVIL AND SESSIONS
JUDGE, MAYO HALL BANGALORE (CCH-29) IN O.S. NO.25877
OF 2013 VIDE ANNEXURE-A.
IN W.P.NO.51582/2014:
BETWEEN
KINGFISHER FINVEST (INDIA) LIMITED,
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
UB TOWER, LEVEL 12, UB CITY,
8
24, VITTAL MALLYA ROAD,
BENGALURU-560001
REPRESENTED BY ITS
AUTHORISED SIGNATORY
MR. RITESH SHAH
S/O MR. RAMNIKLAL SHAH
AGED ABOUT 39 YEARS
...PETITIONER
(BY SRI. SRINIVASA S, ADVOCATE)
AND
1. SBICAP TRUSTEE COMPANY LTD.,
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
202, MAKER TOWER E, CUFFE PARADE,
MUMBAI-400005
REPRESENTED BY ITS
CHIEF OPERATIONS OFFICER
MR. V.G. PATHAK
2. STATE BANK OF INDIA
A BANKING CORPORATION CONSTITUTED UNDER
THE STATE BANK OF INDIA ACT, 1955 (23 OF 1955)
HAVING ITS CORPORATE CENTRE AT
STATE BANK BHAVAN,
MADAME CAMA ROAD,
NARIMAN POINT,
MUMBAI 400021
AND HAVING ITS INDUSTRIAL FINANCE BRANCH AT
61, RESIDENCY PLAZA,
RESIDENCY ROAD,
BENGALURU-580025
3. AXIS BANK LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956 AND
HAVING ITS REGISTERED OFFICE AT
TRISHUL, THIRD FLOOR,
OPP. SAMARTHESWAR TEMPLE,
LAW GARDEN, ELLISBRIDGE,
9
AHMEDABAD-380006
GUJARAT, INDIA,
AND HAVING ITS CORPORATE OFFICE AT
AXIS HOUSE, C-2,
WADIA INTERNATIONAL CENTRE,
PANDURANG BUDHKAR MARG,
WORLI, MUMBAI-400025
4. BANK OF BARODA
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT, 1970 (5 OF 1970)
HAVING ITS HEAD OFFICE AT
BARODA HOUSE, P.B. NO.506,
MANDAVI, VADODARA-396 006
ACTING THROUGH ITS BRANCH OFFICE AT
P.O. BOX 11745, SAMATA BUILDING,
GENERAL BHOSALE MARG,
NARIMAN POINT, MUMBAI-400021.
5. BANK OF INDIA
STAR HOUSE, C-5, G BLOCK,
BANDRA KURLA COMPLEX,
BANDRA (E), MUMBAI-400 051.
AND HAVING ITS LARGE CORPORATE BRANCH
AT GROUND FLOOR, ORIENTAL BUILDING,
364, DN ROAD, FORT, MUMBAI-400 001.
6. CENTRAL BANK OF INDIA
A BODY CORPORATE CONSTITUTED UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS) ACT, 1980 AND
HAVING ITS CORPORATE OFFICE AT
CHANDRAMUKHI, NARIMAN POINT,
MUMBAI-560 021.
AND HAVING ITS CORPORATE FINANCE BRANCH
(EARLIER KNOWN AS INDUSTRIAL FINANCE BRANCH)
AT CHANDRAMUKHI, GROUND FLOOR,
NARIMAN POINT, MUMBAI-560 021.
10
7. CORPORATION BANK
MANGALADEVI TEMPLE ROAD,
PANDESHWAR,
MANGALORE 575 001.
AND HAVING ITS INDUSTRIAL FINANCE BRANCH AT
RALLARAM MEMORIAL BLDG.,
1ST FLOOR, CSI COMPOUND,
MISSION ROAD, BENGALURU-560 027.
8. THE FEDERAL BANK LIMITED
A COMPANY WITHIN THE MEANING OF
THE COMPANIES ACT, 1956,
HAVING ITS REGISTERED OFFICE AT
FEDERAL TOWERS,
AUVA-683 101, KERALA.
AND HAVING ITS BRANCH OFFICE AT
44 AND 45, RESIDENCY ROAD,
BENGALURU-560 025.
9. IDBI BANK LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
AND A BANKING COMPANY WITHIN THE
MEANING OF BANKING REGULATION ACT, 1949
HAVING ITS HEAD OFFICE AT
IDBI TOWER, WTC COMPLEX,
CUFFE PARADE, MUMBAI-400005
MAHARASHTRA, INDIA
AND ACTING THROUGH ITS BRANCH OFFICE AT
CORPORATE BANKING GROUP-FAMG,
9TH FLOOR, IDBI TOWER,
WTC COMPLEX, CUFFE PARADE,
COLABA, MUMBAI-400005.
10. INDIAN OVERSEAS BANK
763, ANNA SALAI,
CHENNAI-600002.
AND ITS BRANCH OFFICE AT
11
'HARIKRIPA', 26-A, S.V.ROAD,
SANTACRUZ (W), MUMBAI-400054.
11. PUNJAB AND SIND BANK
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT, 1980 AND
HAVING ITS HEAD OFFICE AT
21, RAJENDRA PLACE,
NEW DELHI-110008.
AND HAVING AMONGST OTHERS, A BRANCH OFFICE AT
J.K.SOMANI BUILDING,
BRITISH HOTEL LANE,
FORT, MUMBAI-400023.
12. PUNJAB NATIONAL BANK
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT, 1970 AND
HAVING ITS HEAD OFFICE AT
7, BHIKAJI CAMA PLACE,
NEW DELHI-110066.
ACTING THROUGH ITS LARGE CORPORATE BRANCH AT
CENTENARY BUILDING, 28,
M.G.ROAD, BENGALURU-560001.
13. STATE BANK OF MYSORE
A BODY CORPORATE CONSTITUTED UNDER
THE STATE BANK OF INDIA,
(SUBSIDIARY BANKS) ACT, 1959,
HAVING ITS HEAD OFFICE AT
KEMPE GOWDA ROAD,
BENGALURU-560009.
AND HAVING ITS CORPORATE ACCOUNTS BRANCH AT
NO.18, RAMANASHREE ARCADE,
M.G. ROAD, BENGALURU-560001.
14. UCO BANK
A BODY CORPORATE CONSTITUTED UNDER
12
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS) ACT, 1970
AND HAVING ITS HEAD OFFICE AT
10, BTM SARANI, KOLKATA-700001,
WEST BENGAL, INDIA,
AND HAVING ITS BRANCH OFFICE AT
1ST FLOOR, 13/22,
K.G.ROAD, BENGALURU-560009.
15. UNITED BANK OF INDIA
A BODY CORPORATE CONSTITUTED UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS) ACT, 1970 (5 OF 1970)
AND HAVING ITS HEAD OFFICE AT
11, HEMANTA BASU SARANI,
KOLKATA-700 001
ACTING THROUGH ITS BRANCH OFFICE AT
40, K.G. ROAD, BENGALURU-560 009
RESPONDENT NOS.2 TO 15
REPRESENTED BY
MR. S. RANGA VITTAL
ASSISTANT GENERAL MANAGER AND
RELATIONSHIP MANAGER - AMT IV
STATE BANK OF INDIA
HAVING ITS INDUSTRIAL FINANCE BRANCH AT
61, RESIDENCY PLAZA,
RESIDENCY ROAD
BENGALURU-580 025
16. IDBI TRUSTEESHIP SERVICES LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
ASIAN BUILDING, 17, R. KAMANI MARG,
BALLARD ESTATE, MUMBAI-400 001.
17. INDIA GLOBAL COMPETITIVE FUND
86C, TOPSIA ROAD (SOUTH)
KOLKATA-700 046
13
18. SREI VENTURE CAPITAL LTD.,
INVESTMENT MANAGER -
INDIA GLOBAL COMPETITIVE FUND
86C, TOPSIA ROAD (SOUTH)
KOLKATA-700 046.
19. KINGFISHER AIRLINES LIMITED
A PUBLIC LIMITED COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
UB TOWER, LEVEL 12, UB CITY
24, VITTAL MALLYA ROAD,
BENGALURU-560001
20. UNITED BREWERIES (HOLDINGS) LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
UB TOWER, LEVEL 12, UB CITY
24, VITTAL MALLYA ROAD,
BENGALURU-560 001
...RESPONDENTS
(BY SRI. G. KRISHNAMURTHY, SENIOR COUNSEL A/W SRI.
VEERENDRA PATIL, ADVOCATE FOR RESPONDENT NOS.1 TO
15;
VIDE ORDER DATED 01.07.2019 IN W.P.NO.42492-943/2016,
NOTICE ON BEHALF OF OFFICIAL LIQUIDATOR ACCEPTED BY
SRI. SRISHAIL NAVALGUND)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH
THE IMPUGNED ORDER DATED 15.10.2014 (ANNEXURE-A)
PASSED IN O.S.NO.25877/2013 ON THE FILES OF THE XXVIII
ADDITIONAL CITY CIVIL AND SESSIONS JUDGE AT BANGALORE
(CCH NO.29).
14
IN W.P.NO.53330/2014:
BETWEEN
KINGFISHER AIRLINES LIMITED
A PUBLIC LIMITED COMPANY
INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
UB TOWER, LEVEL 12, UB CITY,
24, VITTAL MALLYA ROAD,
BENGALULRU-560001
REPRESENTED BY ITS AUTHORISED SIGNATORY
MR. T.R.VENKATADRI
...PETITIONER
(VIDE ORDER DATED 04.03.2020, SRI. SHRISHAIL
NAVALGUND, OFFICIAL LIQUIDATOR)
AND
1. SBICAP TRUSTEE COMPANY LTD.,
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
202, MAKER TOWN E, CUFFE PARADE,
MUMBAI-400005
REPRESENTED BY ITS
CHIEF OPERATIONS OFFICER
MR. V.G.PATHAK
2. STATE BANK OF INDIA
A BANKING CORPORATION CONSTITUTED UNDER
THE STATE BANK OF INDIA ACT, 1955 (23 OF 1955)
HAVING ITS CORPORATION CENTRE AT
STATE BANK BHAVAN, MADAME CAMA ROAD,
NARIMAN POINT, MUMBAI-400021
AND HAVING ITS INDUSTRIAL FINANCE BRANCH AT
61, RESIDENCY PLAZA,
RESIDENCY ROAD,
BENGALURU-580 085.
15
3. AXIS BANK
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956 AND
A BANKING COMPANY WITHIN THE
MEANING OF SECTION 5(C) OF
THE BANKING REGULATION ACT, 1949
AND HAVING ITS REGISTERED OFFICE AT
TRISHUL, THIRD FLOOR,
OPP. SAMARTESHWAR TEMPLE, LAW GARDEN,
ELLIS BRIDGE, AHEMDABAD-380086,
GUJARAT, INDIA
AND HAVING ITS CORPORATE OFFICE AT
AXIS HOUSE, C-2,
WADIA INTERNATIONAL CENTRE,
PANDURANG BUDHKAR MARK,
WORLI, MUMBAI-400025.
4. BANK OF BARODA
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT 1970 (5 OF 1970)
HAVING ITS HEAD OFFICE AT
BARODA HOUSE, P.B.NO.506,
MANDAVI, VADODARA-396006.
ACTING THROUGH ITS BRANCH OFFICE AT
P.O. BOX 11745, SAMATA BUILDING,
GENERAL BHOSALE MARG,
NARIMAN POINT, MUMBAI-400021.
5. BANK OF INDIA
A BODY CORPORATE CONSTITUTED UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS) ACT, 1970 AND
HAVING ITS HEAD OFFICE AT
STAR HOUSE, C-5, G BLOCK
BANDRA KURLA COMPLEX
BANDRA (E), MUMBAI-400051
AND HAVING ITS LARGE CORPORATE BRANCH AT
GROUND FLOOR, ORIENTAL BUILDING
16
364, DN ROAD, FORT
MUMBAI-400001
6. CENTRAL BANK OF INDIA
A BODY CORPORATE CONSTITUTED UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS) ACT, 1980
AND HAVING ITS CORPORATE OFFICE AT
CHANDRAMUKHI, NARIMAN POINT
MUMBAI-560021
AND HAVING ITS CORPORATE FINANCE BRANCH
(EARLIER KNOWN AS INDUSTRIAL FINANCE BRANCH)
AT CHANDRAMUKHI
GROUND FLOOR, NARIMAN POINT
MUMBAI-560021
7. CORPORATION BANK
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS) ACT, 1980 (40 OF 1980)
AND HAVING ITS CORPORATE OFFICE AT
MANGALADEVI TEMPLE ROAD,
PANDESHWAR, MANGALORE-575001
AND HAVING ITS INDUSTRIAL FINANCE BRANCH AT
RALLARAM MEMORIAL BLDG.,
1ST FLOOR, CSI COMPOUND,
MISSION ROAD,
BENGALURU-560027
8. THE FEDERAL BANK LIMITED
A COMPANY WITHIN THE MEANING OF
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
FEDERAL TOWERS, ALUVA-683101
KERALA
AND HAVING ITS BRANCH OFFICE AT
44 AND 45, RESIDENCY ROAD
BENGALURU-560025
17
9. IDBI BANK LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956 AND
A BANKING COMPANY WITHIN THE MEANING OF
THE BANKING REGULATION ACT, 1949
HAVING ITS HEAD OFFICE AT
IDBI TOWER, WTC COMPLEX
CUFFE PARADE, MUMBAI-400005
MAHARASHTRA, INDIA
AND ACTING THROUGH ITS BRANCH OFFICE AT
CORPORATE BANKING GROUP-FAMG
9TH FLOOR, IDBI TOWER
WTC COMPLEX
CUFFE PARADE, COLABA
MUMBAI-400005
10. INDIAN OVERSEAS BANK
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT, 1970
AND HAVING ITS CENTRAL OFFICE AT
763, ANNA SALAI,
CHENNAI-600002
AND ITS BRANCH OFFICE AT
'HARIKRIPA', 26-A, S.V. ROAD,
SANTACRUS (W), MUMBAI-400054
11. PUNJAB AND SIND BANK
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT, 1980
AND HAVING ITS HEAD OFFICE AT
21, RAJENDRA PLACE
NEW DELHI-110008
AND HAVING AMONGST OTHERS
A BRANCH OFFICE AT
J.K. SOMANI BUILDING
BRITISH HOTEL LANE
FORT, MUMBAI-400023
18
12. PUNJAB NATIONAL BANK
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT, 1970 (5 OF 1970)
HAVING ITS HEAD OFFICE AT
7, BHIKAJI CAMA PLACE
NEW DELHI-110066
ACTING THROUGH ITS LARGE CORPORATE BRANCH AT
CENTENARY BUILDING-28
M.G.ROAD, BENGALURU-560001.
13. STATE BANK OF MYSORE
A BODY CORPORATE CONSTITUTED UNDER
THE STATE BANK OF INDIA (SUBSIDIARY BANKS)
ACT, 1959
HAVING ITS HEAD OFFICE AT
KEMPE GOWDA ROAD,
BANGALORE-560009
AND HAVING ITS CORPORATE ACCOUNTS BRANCH
AT NO.18, RAMANASHREE ARCADE
M.G. ROAD, BANGALORE-560001
14. UCO BANK
A BODY CORPORATE CONSTITUTED UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS)ACT, 1970
AND HAVING ITS HEAD OFFICE AT
10, BTM SARANI
KOLKATA-700001
WEST BENGAL, INDIA
AND HAVING ITS BRANCH OFFICE AT
1ST FLOOR, 13/22,
K.G. ROAD, BANGALORE-560009
15. UNITED BANK OF INDIA
A BODY CORPORATE CONSTITUTED UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS) ACT, 1970 (5 OF 1970)
AND HAVING ITS HEAD OFFICE AT
19
11, HEMANTA BASU SARANI,
KOLKATA-700001
ACTING THROUGH ITS BRANCH OFFICE AT
40, K.G. ROAD, BANGALORE-560009
RESPONDENT NOS.2 TO 15
REPRESENTED BY
MR. S. RANGA VITTAL
ASSISTANT GENERAL MANAGER AND
RELATIONSHIP MANAGER-AMT IV
STATE BANK OF INDIA
HAVING ITS INDUSTRIAL FINANCE BRANCH AT
61, RESIDENCY PLAZA,
RESIDENCY ROAD, BANGALORE-580025
16. IDBI TRUSTEESHIP SERVICES LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
ASIAN BUILDING, 17, R. KAMANI MARG,
BALLARD ESTATE, MUMBAI-400001
REPRESENTED BY ITS DIRECTOR
17. INDIA GLOBAL COMPETITIVE FUND
86C, TOPSIA ROAD (SOUTH)
KOLKATA-700046
REPRESENTED HEREIN BY ITS
AUTHORIZED REPRESENTATIVE
MR. SUPRIYO GOLE
18. SREI VENTURE CAPITAL LTD.,
INVESTMENT MANAGER-
INDIA GLOBAL COMPETITIVE FUND
86C, TOPSIA ROAD (SOUTH)
KOLKATA-700046
REPRESENTED HEREIN BY ITS
AUTHORIZED REPRESENTATIVE
MR. SUPRIYO GOLE
20
19. KINGFISHER FINVEST (INDIA) LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
UB TOWER, LEVEL 12, UB CITY,
24, VITTAL MALLYA ROAD
BANGALORE-560001
REPRESENTED BY ITS DIRECTOR.
20. UNITED BREWERIES (HOLDINGS) LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
UB TOWER, LEVEL 12, UB CITY
24, VITTAL MALLYA ROAD
BANGALORE-560001
REPRESENTED BY ITS DIRECTOR
...RESPONDENTS
(BY SRI. G. KRISHNAMURTHY, SENIOR COUNSEL A/W SRI.
VEERENDRA PATIL, ADVOCATE FOR RESPONDENT NOS.1 TO 4,
7 TO 15;
VIDE ORDER DATED 01.07.2019 IN W.P.NO.42492-943/2016,
NOTICE ON BEHALF OF OFFICIAL LIQUIDATOR ACCEPTED BY
SRISHAIL NAVALGUND, ADVOCATE FOR RESPONDENT NO.20;
VIDE ORDER DATED 24.02.20220, CRESTLAW PARTNERS, FOR
RESPONDENT NOS.16 TO 18;
NOTICE SERVED ON RESPONDENT NO.19)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO CALL
FOR THE RECORDS OF THE SUIT IN O.S.NO.25877/2013 AND
QUASH THE IMPUGNED ORDER DATED 15.10.2014 (ANNEXURE-
A) PASSED IN O.S.NO.25877/2013 ON THE FILE OF THE XXVIII
ADDITIONAL CITY CIVIL AND SESSIONS JUDGE AT
BANGALORE.
21
IN W.P. NO.53448/2014:
BETWEEN:
UNITED BREWERIES (HOLDINGS) LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
UB TOWER, LEVEL 12, UB CITY
24, VITTAL MALLYA ROAD,
BANGALORE-560001
REPRESENTED BY ITS AUTHORISED SIGNATORY
MR. RITESH SHAH
...PETITIONER
(BY SRI. VIVEK HOLLA, ADVOCATE)
AND:
1. SBICAP TRUSTEE COMPANY LTD.,
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT 1956
HAVING ITS REGISTERED TOWER AT
202, MAKER TOWN E CUFFE PARADE
MUMBAI-400005
REPRESENTED BY ITS
CHIEF OPERATIONS OFFICER
MR. V.G.PATHAK
2. STATE BANK OF INDIA
A BANKING CORPORATION CONSTITUTED UNDER
THE STATE BANK OF INDIA ACT, 1955 (23 OF 1955)
HAVING ITS CORPORATION CENTRE AT
STATE BANK BHAVAN, MADAME CAMA ROAD,
NARIMAN POINT, MUMBAI-400021
AND HAVING ITS INDUSTRIAL FINANCE BRANCH AT
61, RESIDENCY PLAZA, RESIDENCY ROAD
BENGALURU-580 025.
3. AXIS BANK
A COMPANY INCORPORATED UNDER
22
THE COMPANIES ACT, 1956 AND
A BANKING COMPANY WITHIN THE
MEANING OF SECTION 5(C) OF
THE BANKING REGULATION ACT, 1949
AND HAVING ITS REGISTERED OFFICE AT
TRISHUL, THIRD FLOOR
OPP. SAMARTESHWAR TEMPLE, LAW GARDEN,
ELLIS BRIDGE, AHEMDABAD-380086,
GUJARAT, INDIA AND
HAVING ITS CORPORATE OFFICE AT
AXIS HOUSE, C-2, WADIA INTERNATIONAL CENTER
PANDURANG BUDHKAR MARK, WORLI,
MUMBAI-400025.
4. BANK OF BARODA
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT, 1970 (5 OF 1970)
HAVING ITS HEAD OFFICE AT
BARODA HOUSE, P.B.NO.506,
MANDAVI, VADODRA-396006.
ACTING THROUGH ITS BRANCH OFFICE AT
P.O. BOX 11745, SAMATA BUILDING,
GENERAL BHOSALE MARG,
NARIMAN POINT, MUMBAI-400021.
5. BANK OF INDIA
A BODY CORPORATE CONSTITUTED UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS) ACT, 1970 AND
HAVING ITS HEAD OFFICE AT
STAR HOUSE, C-5, G BLOCK
BANDRA KURLA COMPLEX
BANDRA(E), MUMBAI-400051
AND HAVING ITS LARGE CORPORATE BRANCH AT
GROUND FLOOR, ORIENTAL BUILDING
364, DN ROAD, FORT
MUMBAI-400001
23
6. CENTRAL BANK OF INDIA
A BODY CORPORATE CONSTITUTED UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS) ACT, 1980
AND HAVING ITS CORPORATE OFFICE AT
CHANDRAMUKHI, NARIMAN POINT
MUMBAI-560021
AND HAVING ITS CORPORATE FINANCE BRANCH
(EARLIER KNOWN AS INDUSTRIAL FINANCE BRANCH)
AT CHANDRAMUKHI
GROUND FLOOR, NARIMAN POINT
MUMBAI-560021
7. CORPORATION BANK
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS) ACT, 1980 (40 OF 1980)
AND HAVING ITS CORPORATE OFFICE AT
MANGALADEVI TEMPLE ROAD,
PANDESHWAR, MANGALORE-575001
AND HAVING ITS INDUSTRIAL FINANCE BRANCH AT
RALLARAM MEMORIAL BLDG.,
1ST FLOOR, CSI COMPOUND
MISSION ROAD
BANGALORE-560027
8. THE FEDERAL BANK LIMITED
A COMPANY WITHIN THE MEANING OF
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
FEDERAL TOWERS, ALUVA-683101
KERALA
AND HAVING ITS BRANCH OFFICE AT
44 AND 45, RESIDENCY ROAD,
BANGALORE-560025
9. IDBI BANK LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956 AND
A BANKING COMPANY WITHIN THE MEANING OF
24
THE BANKING REGULATION ACT, 1949
HAVING ITS HEAD OFFICE AT
IDBI TOWER, WTC COMPLEX
CUFFE PARADE, MUMBAI-400005
MAHARASHTRA, INDIA
AND ACTING THROUGH ITS BRANCH OFFICE AT
CORPORATE BANKING GROUP-FAMG
9TH FLOOR, IDBI TOWER
WTC COMPLEX,
CUFFE PARADE, COLABA,
MUMBAI-400005
10. INDIAN OVERSEAS BANK
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT, 1970
AND HAVING ITS CENTRAL OFFICE AT
763, ANNA SALAI,
CHENNAI-600002
AND ITS BRANCH OFFICE AT
'HARIKRIPA', 26-A, S.V. ROAD
SANTACRUS (W)
MUMBAI-400054
11. PUNJAB AND SIND BANK
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT, 1980
AND HAVING ITS HEAD OFFICE AT
21, RAJENDRA PLACE
NEW DELHI-110008
AND HAVING AMONGST OTHERS
A BRANCH OFFICE AT
J.K. SOMANI BUILDING,
BRITISH HOTEL LANE,
FORT, MUMBAI-400023.
12. PUNJAB NATIONAL BANK
A BODY CORPORATE UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKING) ACT, 1970 (5 OF 1970)
25
HAVING ITS HEAD OFFICE AT
7, BHIKAJI CAMA PLACE
NEW DELHI-110066
ACTING THROUGH ITS LARGE CORPORATE BRANCH AT
CENTENARY BUILDING-28
M.G. ROAD,
BANGALORE-560001.
13. STATE BANK OF MYSORE
A BODY CORPORATE CONSTITUTED UNDER
THE STATE BANK OF INDIA (SUBSIDIARY BANKS) ACT,
1959
HAVING ITS HEAD OFFICE AT
KEMPE GOWDA ROAD,
BANGALORE-560009
AND HAVING ITS CORPORATE ACCOUNTS BRANCH
AT NO.18, RAMANASHREE ARCADE
M.G. ROAD, BANGALORE-560001
14. UCO BANK
A BODY CORPORATE CONSTITUTED UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS)ACT, 1970
AND HAVING ITS HEAD OFFICE AT
10, BTM SARANI
KOLKATA-700001
WEST BENGAL, INDIA
AND HAVING ITS BRANCH OFFICE AT
1ST FLOOR, 13/22,
K.G. ROAD
BANGALORE-560009
15. UNITED BANK OF INDIA
A BODY CORPORATE CONSTITUTED UNDER
THE BANKING COMPANIES (ACQUISITION AND
TRANSFER OF UNDERTAKINGS) ACT, 1970 (5 OF 1970)
AND HAVING ITS HEAD OFFICE AT
11, HEMANTA BASU SARANI
KOLKATA-700001
ACTING THROUGH ITS BRANCH OFFICE AT
26
40, K.G. ROAD,
BANGALORE-560009
RESPONDENT NOS.2 TO 15
REPRESENTED BY
MR. S. RANGA VITTAL
ASSISTANT GENERAL MANAGER AND
RELATIONSHIP MANAGER-AMT IV
STATE BANK OF INDIA
HAVING ITS INDUSTRIAL FINANCE BRANCH AT
61, RESIDENCY PLAZA
RESIDENCY ROAD, BANGALORE-580025
16. IDBI TRUSTEESHIP SERVICES LIMITED
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
ASIAN BUILDING, 17,
R. KAMANI MARG, BALLARD ESTATE,
MUMBAI-400001.
17. INDIA GLOBAL COMPETITIVE FUND
86C, TOPSIA ROAD (SOUTH)
KOLKATA-700046
REPRESENTED BY ITS AUTHORISED SIGNATORY
18. SREI VENTURE CAPITAL LTD.,
INVESTMENT MANAGER-
INDIA GLOBAL COMPETITIVE FUND
86C, TOPSIA ROAD (SOUTH)
KOLKATA-700046
REPRESENTED BY ITS AUTHORISED SIGNATORY
19. KINGFISHER AIRLINES LIMITED
A PUBLIC LIMITED COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
UB TOWER, LEVEL 12, UB CITY,
24, VITTAL MALLYA ROAD,
BANGALORE-560001
REPRESENTED BY ITS AUTHORISED SIGNATORY
27
20. KINGFISHER FINVEST (INDIA) LIMITED,
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
UB TOWER, LEVEL 12, UB CITY
24, VITTAL MALLYA ROAD
BANGALORE-560001
REPRESENTED BY ITS AUTHORISED SIGNATORY
...RESPONDENTS
(BY SRI. G. KRISHNAMURTHY SENIOR COUNSEL A/W SRI.
VEERENDRA PATIL, ADVOCATE FOR RESPONDENT NOS.1 TO 4
AND 7 TO 15;
VIDE ORDER DATED 01.07.2018 IN W.P.NO.42942-943/2016,
NOTICE ON BEHALF OF OFFICIAL LIQUIDATORS ACCEPTED BY
SRISHAIL NAVALGUND, ADVOCATE FOR RESPONDENT NO.19;
VIDE ORDER DATED 24.02.2020 CREST LAW PARTNERS, FOR
RESPONDENT NOS.16 TO 18)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH
THE IMPUGNED ORDER DATED 15.10.2014 (ANNEXURE-A)
PASSED IN O.S.NO.25877/2013 ON THE FILES OF THE XXVIII
ADDITIONAL CITY CIVIL AND SESSIONS JUDGE AT
BANGALORE.
THESE PETITIONS COMING ON FOR PRELIMINARY
HEARING IN 'B' GROUP THIS DAY, THE COURT MADE THE
FOLLOWING:
28
ORDER
The petitioners in W.P.No.50238/2014 were the defendant Nos.1 to 3, while the petitioner in W.P.No.53330/2014 was defendant No.4 and petitioner in W.P.No.53448/2014 was defendant No.5 and petitioner in W.P.No.51582/2014 was defendant No.6 in O.S.No.25877/2013 on the file of the XXVIII Addl. City Civil Judge, Bengaluru, (henceforth referred to as 'Trial Court' for short) who have challenged the order dated 15.10.2014 passed therein, by which, the Court allowed an application filed by the plaintiffs under Order VI Rule 17 of the Code of Civil Procedure, 1908 (henceforth referred to as 'CPC' for short) to amend the plaint.
2. The suit in O.S.No.25877/2013 was filed by a consortium of banks for a declaration that they are entitled to compel the defendants to sell the shares pledged to them at the best market price. They sought for mandatory injunction directing the defendant Nos.1 to 3 to sell the schedule 'A' shares in the open market at the best price 29 but not below Rs.2350.68 per share or at any lower price as may be approved by the plaintiffs. They also sought for a mandatory injunction directing the defendant Nos.1 to 3 to sell the schedule 'B' shares in the open market at the best market price but not below Rs.4.73 per share or at any price lower than that, as approved by them. They also sought for perpetual injunction restraining the defendants from selling the pledged shares at a price or in any manner prejudicial to the rights of the plaintiffs and from committing breach of the obligations under the Residual Interest Agreement dated 21.12.2010.
3. The plaintiffs claimed that at the request of the defendant No.4, they provided fund based working capital facility and term loan facilities including short term loans, which were evidenced by corresponding agreements. On the request of the defendant No.4, the debt of the defendant No.4 was re-casted and a Master Debt Recast Agreement (henceforth referred to as "MDRA" for short) dated 21.12.2010 was executed. Simultaneously, various 30 other agreements were executed to secure the obligations under the MDRA. The loan facilities provided to the defendant No.4 was treated as a single Working Capital Facility. Consequent to the MDRA, the defendant No.4 settled a Trust and appointed the plaintiff No.1 as a Security Trustee, whose functions, inter alia, was to hold for the benefit of the consortium banks, the security created or to be created, to secure the obligations under the MDRA. The defendant No.5 and Dr. Vijay Mallya gave corporate guarantee and personal guarantee dated 21.12.2010 to secure the obligations under the MDRA. It is contended that in the year 2008, the defendant No.5 pledged 31,47,985 shares held by it in United Spirits Limited on behalf of ICICI Bank in favour of defendant No.1. While the defendant No.6 pledged 17,89,410 shares held by it in United Spirits Limited on behalf of ICICI Bank in favour of the defendant No.1, which are referred to as "the schedule 'A' shares". The defendant No.5 had pledged 5,91,50,000 shares held by it in defendant No.4 in favour 31 of defendant No.1 on behalf of ICICI Bank. These shares are referred to as "schedule 'B' shares".
4. It is claimed that the defendant Nos.5 and 6 understood that the consortium of banks had a residual interest in the pledged shares. In that regard, a release of Residual Interest Agreement dated 21.12.2010 was executed between the plaintiff No.1 and the defendant Nos.1, 4, 5 and 6. In addition, the defendant Nos.4, 5 and 6 had executed a Residual Interest Undertaking dated 21.12.2010 in favour of the plaintiff No.1. Thereafter, in the year 2012, the obligation of the defendant No.4 to ICICI bank was transferred to the defendant No.2 in terms of a Novation and Transfer Notice dated 27.06.2012.
5. As per the Residual Interest Agreement, the plaintiff No.1 was entitled to the surplus sale proceeds or the surplus pledged shares after the satisfaction of the dues owed by the defendant No.4 to the defendant No.2. It is claimed that the defendant No.4 was not entitled to receive back the pledged shares in view of the recital 32 contained in the Residual Interest Agreement. The plaintiffs alleged that the defendant No.4 defaulted in the performance of its obligations under the MDRA. The defendant Nos.1 to 3 were surreptitiously attempting to sell the schedule 'A' shares to Diageo PLC, a multinational company, which offered to buy the schedule 'A' shares at Rs.1440 per share, while the closing market price of the said shares as on 07.06.2013 was Rs.2,474.40 per share. Following this, several correspondence ensued between the parties, which culminated in the present suit for the reliefs mentioned above.
6. The defendant Nos.5 and 6 contested the suit contending that the value of the schedule 'A' shares substantially appreciated in view of the announcement of the transfer of the undertaking to Diageo PLC.
7. During the pendency of the suit, the plaintiff No.1 claimed that it received a letter from the defendant No.1 stating that it had invoked and transferred the pledged shares to the Depository Participant Account of 33 the defendant No.2 and that the defendant Nos.2 and 3 had sold some of the schedule 'A' shares on 13.06.2014.
8. The defendant Nos.1 to 3 filed a memo before this Court that they had realized an approximate sum of Rs.1,341 crores at an average price of Rs.2,716/- per share. The plaintiffs claimed that if the defendant Nos.2 and 3 had sold the schedule 'A' shares at the best market price, which was then Rs.3,030/- per share, the surplus proceeds would be Rs.155,03,06,850/-. The plaintiffs therefore, claimed that the defendant Nos.1 to 3 were jointly and severally liable to compensate the plaintiffs for all the loss caused to them due to their action. The plaintiffs claimed that the defendant Nos.1 to 3 had filed a memo dated 19.06.2014 before this Court stating therein that the defendant No.2 had appropriated Rs.690 crores being the outstanding dues from the defendant No.4, which the plaintiffs claimed to be inflated and exaggerated. The plaintiffs alleged that though the surplus sale proceeds and the surplus pledged shares had to be handed over to 34 the plaintiffs, the defendant Nos.2 and 3 offered to pay surplus sale proceeds subject to the condition that the payment would be subject to the directions of the Court. The plaintiffs alleged that the surplus proceeds were invested by the defendant Nos.2 and 3 in short-term earning instruments, thereby unjustly enriching themselves.
9. Since the events following the sale of schedule 'A' shares occurred subsequent to the filing of the suit, the plaintiffs filed an application under Order VI Rule 17 of CPC read with Section 40 of the Specific Relief Act, 1963, to bring on record the events and sought introduction of additional pleadings and additional prayers namely, to declare the enforcement of the pledge by the defendant Nos.1 to 3 and the consequent sale of the schedule 'A' shares was in contravention of the terms of the release of Residual Interest Agreement dated 21.12.2010 and for a direction to the defendant Nos.1 to 3 to pay a sum of Rs.155,03,06,850/- to the plaintiff No.1 on behalf of the 35 plaintiff Nos.2 to 15. The plaintiffs also sought for a direction to the defendant Nos.1 to 3 to pay a sum of Rs.651 crores, claimed to be the surplus proceeds after sale of the schedule 'A' shares and to transfer the schedule 'B' shares to the account of plaintiff No.1. They sought for interest on the aforesaid sum at the rate of 12% per annum and for compensation for the loss incurred on account of delay in the transfer of the shares to the plaintiff No.1 and for a direction to the defendant Nos.2 and 3 to render true and correct accounts of the loan transaction with the defendant No.4 and to pay all amounts due in excess of legitimate dues of the defendant Nos.2 and 3 along with interest at 12% per annum.
10. This application was opposed by the defendant Nos.1 to 3 contending that consequent to the sale of schedule 'A' shares at Rs.2,716/- per share, the plaint reliefs were substantially granted as the plaintiffs desired that the schedule 'A' shares should not be sold below Rs.2350.68 per share. It was contended that if the 36 plaintiffs desired to recover the surplus sale proceeds, they have to file a separate suit and could not amend the suit to introduce the reliefs sought for, as that would not only change the cause of action but also the nature of the suit.
11. The Trial Court noticed the turn of events that lead to the filing of the application under Order VI Rule 17 of CPC read with Section 40 of the Specific Relief Act, 1963 and held that the events had all occurred subsequent to the date of the filing of the suit and therefore, in order to do complete justice between the parties and to avoid multiplicity of proceedings, allowed the application and permitted to plaintiffs to amend the plaint and seek the additional reliefs stated in the application.
12. Being aggrieved by the said order, the defendant Nos.1 to 6 have all challenged the order in these writ petitions.
13. The learned Senior counsel for the petitioners in W.P.No.50238/2014 submitted that the cause of the 37 action for the suit filed initially was completely liquidated in view of the sale of the schedule 'A' shares at a price higher than Rs.2,350.68 per share and therefore, if the plaintiffs desired to claim the surplus sale price, the plaintiffs were bound to file a separate suit and could not fuse those reliefs in the present suit. He further contended that allowing this application would not only result in changing the cause of action but also changing the nature of the suit itself, which is impermissible.
14. The learned counsel for the petitioners in other writ petitions also supported the contentions of the learned Senior counsel.
15. Per contra, the learned Senior counsel representing the plaintiffs contended that the cause of action sought to be introduced by way of an amendment arose out of the events that were brought about by the defendant Nos.2 and 3, which had a clear bearing on the suit as originally filed and therefore, to avoid multiplicity of proceedings, the amendment was necessary. He submitted 38 that it was the plaintiffs Nos.2 to 15, who are entitled for the surplus sale proceeds under the Residual Interest Agreement and therefore, the amounts lying with the defendant Nos.1 to 3 had to be made over to the plaintiff No.1. The learned Senior counsel further submitted that after the application for amendment was allowed by the impugned order, the defendants have filed their written statement and the case has now progressed further and is now set down for cross-examination of the plaintiffs' witness. He therefore, submitted that the writ petitions filed may be rejected.
16. I have considered the submissions made by the learned Senior counsel appearing for the parties.
17. It is not in dispute that the suit was filed to compel the defendants to sell the schedule 'A' shares at a price not below Rs.2350.68 per share. It is not in dispute that the schedule 'A' shares are now sold by the defendant Nos.1 to 3 at Rs.2,716 per share. It is not prudent for this Court to comment upon the question whether the 39 defendant Nos.1 to 3 could have sold the schedule 'A' shares in violation of the MDRA and the ancillary agreements. But nonetheless, the said sale of shares was without the permission of the Court. Be that as it may, since the shares are sold, the plaintiffs have an actionable claim against the defendants to recover the excess sale price generated from the sale of the schedule 'A' shares and this cause of action arose subsequent to the filing of the suit and therefore, in order to avoid multiplicity of proceedings, the Trial Court was justified in allowing the application for amendment. These writ petitions also deserve to be dismissed as the parties have now altered their position by amending the plaint, filing the written statement and adducing the evidence on the amended plaint. Therefore, this Court does not consider it appropriate to interfere with the order passed by the Trial Court allowing the application for amendment.
Hence, all these writ petitions are dismissed. 40
Pending I.A., if any, does not survive for
consideration.
Sd/-
JUDGE
PMR