Delhi High Court - Orders
Re-Hoffland Finance Ltd. Co vs Unknown on 9 February, 2022
Author: Vibhu Bakhru
Bench: Vibhu Bakhru
$~ 6(Company)
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CO. PET. 351/1999
RE-HOFFLAND FINANCE LTD. CO. ..... Petitioner
Through
versus
......... ..... Respondents
Through Col P. M. Dubey, Chairman of the Court
Appointed Committee.
Mr. Sanjeev Ralli, Sr. Advocate with Ms. Mamta
Mehra, Mr. Mohit Mudgal, Devavrat Joshi & Mr.
Ravi Kant Yadav, Advocates for the Court
Appointed Committee.
Ms Sanya Panjwani,
Mr Dheeraj Gupta, Advocate.
Mr Ashish Aggarwal, Advocate.
Ms Ruchi Sindhwani, Advocate for Official
Liquidator.
CORAM:
HON'BLE MR. JUSTICE VIBHU BAKHRU
ORDER
% 09.02.2022 [Hearing held through videoconferencing] CO. APPL. 80/2022
1. Allowed subject to just exception.
CO. APPL. 17/2022 CO. APPL. 79/20222. The Official Liquidator has filed the present application (CO. APPL 17/2022), inter alia, praying as under:-
"i) Application on behalf of the Official Liquidator may kindly be taken on record;
ii) E-auction sale notice & Terms & Conditions of Sale w.r.t. property of the Company (In Liqn.) (in Signature Not Verified Digitally Signed By:Dushyant Rawal Signing Date:16.02.2022 the name of Goga Foods & Hoffland Engineers Ltd.) situated at Village Khekhra, District Baghpat, UP, Annexed as Annexure-C may kindly be approved;
iii) Official Liquidator be permitted to publish the sale notice in the newspapers namely 'Hindustan Times' (English), UP Edition and 'Amar Ujala' (Hindi) UP Edition;
iv) Official Liquidator be permitted to incur expenses for the publication from the funds of the Company (In Liqn.);
v) Official Liquidator be permitted to conduct E-
auction through M/s Railtel Corporation Limited (E-Auction Agency);"
3. Ms Sindhwani, learned counsel appearing for the Official Liquidator has referred to the order dated 18.10.2019 passed by this Court in CA No. 652/2007 and CA No. 1445/2013, whereby this Court had found that certain tracts of land registered in the name of Goga Foods Ltd, which are included as a part of the property which is now sought to be sold by the Official Liquidator, were purchased from the funds of the Company in liquidation (Hoffland Finance Limited). The Court had also recorded that Goga Foods Ltd. had not shown any interest in the said land which was located outside its factory premises, since the past 25 years and the same demonstrated that, in fact, Hoffland Group has purchased the land in question and the funds for the said purchase were transferred to Goga Foods Limited.
4. Goga Foods Limited preferred an appeal before the Division Bench of this Court against the said Order dated 18.10.2019, being Goga Foods Limited v. Hoffland Finance Limited : Company Appeal No. 26/2019. In the said appeal, the Division Bench of this Court passed an interim order on Signature Not Verified Digitally Signed By:Dushyant Rawal Signing Date:16.02.2022 20.12.2019, restraining the Official Liquidator from dealing with the land which fell within the factory premises of Goga Foods Limited. However, the same was subject to certain conditions. One of the conditions, is that the Official Liquidator would be entitled to deal with the land which was registered in the name of Goga Foods Ltd but fell outside the factory premises.
5. Ms Sindhwani states on the strength of the said order that there is no impediment in selling the property in question for settling the dues of Hoffland Finance Limited.
6. One Mr V.K. Sharma who is stated to be the Ex-Chairman - cum - Managing Director of JVG Finance Limited has filed an application (CA No. 79/2022) praying that the sale of any land standing in the name of Goga Foods Limited be stayed till adjudication of the rights of 'the JVG Group'. Mr Gupta, who appears for Mr VK Sharma submits that a One Man Committee was constituted in proceedings relating to winding up of JVG Finance Limited, to report on the affairs of that company. The Committee had submitted a report identifying Goga Foods Limited as one of the companies of the JVG Group. He states that the assets of Goga Foods Limited are now required to be utilized for payments of the dues of JVG Finance Limited and other Group Companies.
7. The said report indicates that out of ₹22.80 crores, which were transferred from the accounts of JVG Finance Limited to other group companies of JVG Group, a sum of ₹72,45,239/- had been utilized by Goga Foods Ltd. to purchase certain immovable properties. Mr Gupta also referred to an order dated 30.04.2012 passed by a co-ordinate Bench of this Signature Not Verified Digitally Signed By:Dushyant Rawal Signing Date:16.02.2022 Court in CCP (Co.) 17/2007 in Company Petition 265/1998 (Company Petition filed by the Reserve Bank of India for winding up of JVG Finance Limited). The said Judgment indicates that a report had been submitted by the Additional Director, Serious Fraud Investigation Office (SFIO) regarding the affairs of JVG Group and it was reported that certain lands had been purchased by other Companies, including Goga Foods Limited from the funds of JVG Finance Limited. Paragraph 12 of the said order indicates that certain lands had been purchased in Gurgaon in the name of Goga Foods Limited for a sum of ₹72,45,239/- which was transferred by JVG Finance Limited.
8. Mr Gupta submits that Goga Foods Limited is one of the Companies of JVG Group and therefore, its assets are now required to be utilized for the benefit of the Creditors of Goga Foods Limited, JVG Finance Limited and other companies of the JVG Group. He submits that the shares of Goga Foods Limited were taken over by entities of JVG Group including its Promoters and therefore, its assets cannot be utilized for meeting the liabilities of Hoffland Finance Limited.
9. Ms Anita Sharma who also claims to represent the Ex-Management of JVG Finance Limited drew the attention of this Court to an application being CA No. 230/2015 filed by Sh V.K. Sharma (the applicant in CA no. 79/2022) stating that in addition to the funds as mentioned in the SFIO Report, Goga Foods Limited was also financed to the extent of ₹3.52 Crores for purchase of plant and machinery. She states that a sum ₹3.49 crores was also given to M/s Hoffland Share Shoppers and ₹62.7 lakhs was given to Hoffland Finance Limited for taking over all assets and shares of Goga Signature Not Verified Digitally Signed By:Dushyant Rawal Signing Date:16.02.2022 Foods Limited in the year 1995-96.
10. Mr Aggarwal, learned counsel appearing for Goga Foods Limited states that Goga Foods Limited accepts the order passed by the Division Bench and is not objecting to the sale of the property in question.
11. I have heard the learned counsel for the parties.
12. It is relevant to note that by an order dated 30.04.2012, the co- ordinate Bench of this Court had issued specific directions for instituting petition for winding up of certain companies which belonged to JVG Group. Goga Foods Limited is one of the said companies.
13. The Ex-CMD of JVG Finance Limited - Sh V.K. Sharma (applicant in CA 79/2022) relies upon this order in support of his prayers that the land in question standing in the name of Goga Foods Limited should not be sold. Thus, clearly, it is not open for him to resist the winding up of Goga Foods Limited as the order dated 30.04.2012 does indicate that the funds of JVG Finance Ltd had been fraudulently utilized through other entities, which are required to be liquidated. In this view, there is no reason to refrain from directing sale of the property in question part of which is registered in the name of Goga Foods Ltd.
14. There is a controversy as to how the sale proceeds of the assets of the Goga Foods Limited are required to be dealt with. As noticed above, the appeal preferred by Goga Foods Limited against the order of this Court holding that the land in question in the name of Goga Foods had been purchased from the funds of Hoffland Finance Limited is pending before the Division Bench of this Court and the decision in the said appeal would have Signature Not Verified Digitally Signed By:Dushyant Rawal Signing Date:16.02.2022 a bearing on the question whether the funds realised from the sale of assets of Goga Foods Limited are required to be utilized for payment of its creditors, creditors of JVG Finance Limited, or those of Hoffland Finance Limited. In any view of the matter, there are no grounds for staying the sale of the property in question, which lies outside the factory premises of Goga Foods Limited.
15. Ms Sindhwani, learned counsel appearing for the Official Liquidator has shared an amended draft sale notice electronically which indicates that the Official Liquidator propses to sell the land belonging to Goga Foods Limited and Hoffland Engineers Limited at a consolidated value. The said Sale Notice is approved and it directed that the same be placed on record. The Official Liquidator would proceed with the auction of the said property and engage the services of M/s Railtel Corporation Limited for the said purpose.
16. The Sale Notice shall be published in the newspapers namely 'Hindustan Times' (English), UP Edition and 'Amar Ujala' (Hindi), UP Edition.
17. The application (CO. APPL 17/2022) is allowed in the aforesaid terms. Consequently, CO. APPL. No. 79/2022 is dismissed.
VIBHU BAKHRU, J FEBRUARY 9, 2022 pkv Click here to check corrigendum, if any Signature Not Verified Digitally Signed By:Dushyant Rawal Signing Date:16.02.2022