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Showing contexts for: canara in Real Value Appliances Ltd. Etc., ... vs Canara Bank & Ors. Etc., Vardhman ... on 5 May, 1998Matching Fragments
WITH CIVIL APPEAL NO .... 2573 ................. /1998 (Arising out of S.L.P. (C) No. 14750/1997) AND CIVIL APPEAL NO ........2574 .............../1998 (Arising out of S.L.P (C) No. 15736/1997) J U D G M E N T M. JAGANNADHA RAO, J.
Special leave granted in all the Special leave petitions.
Civil Appeal arising out of SLP (C) No. 14327/1997 is filed by `Real Value Appliances Ltd' against order of the High Court of Bombay dated 28.7.1997 passed by a Division Bench in an interlocutory appeal appointing a Receiver to take formal possession of the mortgaged properties which are subject matter of suit No. 82 of 1997 pending before a learned Single Judge of the said High Court on the Original Side. The respondent Canara Bank, which is the plaintiff in the suit is claiming in consortium with Union Bank of India a sum of Rs. 23.67 crores (approximately) as due to it as on 24.12.1996. Earlier the Single Judge of the Bombay High Court in his order dated 10.1.1997 had disallowed the application for appointment of Receiver in view of the stay of appointment of provisional Liquidator granted by a Division Bench of the Bombay High Court in winding up proceedings on 20.12.1996.
One other important fact to be noted is that on 10.11.1997 in SLP 14327/1997, this Court passed an order, - after hearing both sides, adjourning the SLPs "to enable the BIFR to come to a decision'. This Court, however, directed the appellant-Company not to dispose of or alienate or create any third party interests in any of the assets of the Company except with the previous approval of the BIFR and that before passing any orders, the BIFR will give hearing to the Canara Bank. This Court also recorded an assertion by the Bank that the Receiver had taken formal possession of the properties. This assertion was no doubt denied by the Company. This Court also noticed that the High Court of Bombay had, in its order dated 8.8.97 accepted as true the serious allegations made by the Canara Bank against the appellant Company.
It is necessary to refer to certain subsequent events which have since taken place after the orders under appeal were passed by the High Court. These events relate mainly to three orders passed by the BIFR.
(i) On 9.9.1997, the BIFR passed orders, after hearing the representatives of the appellant - Company and Canara Bank and the IDBI (which was also to get around Rs. 38 crores from the company), directing the IDBI under Section 16(2) of the Act to examine and analyse the audited balance sheets of the Company upto 30.6.1997 and submit a status report. The Bank was also directed to submit its reaction or comments to the IDBI. The contentions raised by the Bank's representatives were elaborately set out.
(iii) A notice was issued by BIFR fixing 15.12.1997 as the date on which the allegations of the Canara Bank against the Company would be heard. On 15.12.1997, the BIFR passed further orders after hearing the Bank's representatives observing that the allegations made by the Bank against the Company had been considered by the IDBI and that the IDBI had prepared a status report and that the BIFR was satisfied that the allegations of the Bank against the company - in regard to the change in the accounting year and provision for depreciation and interest and in regard to the preparation of the balance sheet - could not be accepted inasmuch as these actions "were permissible under the various provisions of the Companies Act, 1956 and as such these were valid under law". The matter was adjourned to enable the company to submit its revival/rehabilitation proposals. These are the three orders passed by the BIFR subsequent to the impugned orders of the Bombay High Court.