,,
Mukta Gupta, J",,
I.A. 4155/2020 (under Order XXXIX Rule 1 and 2 CPC-by defendant Nos.1 and 3),,
1. The hearing has been conducted through Video Conferencing.,,
2. By the present application filed by defendant Nos.1 and 3 in the representative capacity on behalf of defendant No.4, the following prayers are",,
made:,,
(a) grant a mandatory injunction and pass such necessary orders and directions against the Plaintiffs to enable Defendant No. 4 to,,
undertake its business and affairs, including by raising finances to meet the deposit amount of Rs 4,00,00,000/- (Rupees Four Crores) in",,
terms of the SC Order by creating an appropriate security in respect of such number of the Unsold Units in Towers C1 and C2 in Defendant,,
No. 4’s Project and/or by creating a hypothecation on the future receivables of sold units in Towers C1 and C2 in Defendant No.,,
4’s Project as detailed in Paragraph 65 above without the requirement of any consent from the Plaintiffs in that regard ;,,
(b) grant a mandatory injunction and pass such necessary orders and directions against Plaintiff No.2 to enable Defendant No. 4 to,,
undertake its business and affairs including by raising finance for re-commencing and completing the development of the Project including,,
Towers C1 and C2 by creating appropriate security in respect of Defendant No. 4’s Project including the Land and the development of,,
Towers C1 and C2 thereon and future receivables of units in Towers C1 and C2 in Defendant No. 4’s Project as detailed in Paragraph,,
65 above, without requirement of any consent from the Plaintiffs in that regard;",,
(c) pass such prohibitory orders and injunction restraining the Plaintiffs and/or their employees, servants, affiliates, associates from",,
interfering and/or obstructing in the business of Defendant No.4 including undertaking development and construction of the Project 45,,
Nirvana Hills;,,
(d) pass such necessary orders and directions appointing person(s) / committee of by this Hon`ble Court to oversee and monitor the due,,
implementation and execution of Defendant No.4’s Project by these Defendants under the aegis of this Hon’ble Court.,,
(e) may exempt these Defendants from filing a duly affirmed affidavit in support of the instant Application and the requisite Court Fee due,,
to the prevailing circumstances due to the spread COVID-19 pandemic;,,
Pass any such other and further orders/reliefs as this Hon’ble Court may deem fit and proper;,,
3. Learned counsel for the applicants/defendant Nos.1 and 3 stated that at this stage the urgency in the application is to the extent of raising finances,,
to meet the requirement of deposit of ₹4 crores in terms of the decision of the Honâ€ble Supreme Court by creating an appropriate security in respect,,
of such number of unsold units in Tower-C-1 and C-2 of defendant Nos.4â€s project and in this regard the defendant Nos.1 and 3 have identified,,
three flats being flat Nos.905, 1001, and 1002 in Tower-2. However, considering the fact that both the parties have addressed arguments at length, this",,
Court is proceeding to decide the application.,,
4. According to learned counsel for the applicants the necessity to file the present application arose because of the fact that in an arbitration in respect,,
of the disputes amongst the defendant No.4 and its contractor POSCO (E&C) India Pvt. Ltd. (in short “POSCOâ€) which was appointed for the,,
work of supply, construction, completion, commissioning and maintenance and Tower C-1 and C-2 of the project, an award for a sum of ₹45 crores",,
was passed against the defendant No.4.,,
5. Challenging the said award, the defendant No.4 filed a petition under Section 34 of the Arbitration and Conciliation Act, 1996 (in short “the",,
Actâ€) before the Bombay High Court being Commercial Arbitration Petition No.238/2019 wherein the defendant No.4 was granted stay. Challenging,,
the said order POSCO filed a petition before the Honâ€ble Supreme Court being SLP (C) No.25412/2019 whereby vide order dated 4th February,",,
2020 without going into the merits of the matter, Hon'ble Supreme Court directed defendant No.4 to deposit a sum of ₹5 crores within a period of",,
eight weeks from the date of the order failing which the interim stay granted by the Bombay High Court against the execution of the arbitral award,,
would stand vacated.,,
6. Since defendant No.4 was short of funds in order to comply with the order dated 4th February, 2020 an email dated 21st February, 2020 was",,
addressed to the plaintiffs requesting their permission for generating funds by availing secured/unsecured loan facility, sale of remaining stock of flats",,
etc. It is the case of the applicants that vide their reply dated 2nd March, 2020, plaintiffs made wrongful allegations against the applicants and rejected",,
the proposal made by the applicants for generation of the funds. Due to the nationwide lockdown due to outbreak of COVID-19, defendant No.4 was",,
unable to deposit the amount as directed by the Supreme Court. Consequently a miscellaneous application being Misc.Appl. No.927/2020 in SLP (C),,
No.25412/2019 was filed before the Honâ€ble Supreme Court inter alia seeking extension of time to comply with the directions passed vide order,,
dated 4th February, 2020.",,
7. According to the applicants vide order dated 11th May, 2020 the Honâ€ble Supreme Court granted extension of time and directed defendant No.4",,
to pay an amount of ₹1 crore within one week, that is, by 18th May, 2020 and the balance amount of ₹4 crores by 15th June, 2020. In view of the",,
urgency, the first instalment of ₹1 crore has been deposited by the defendant No.4 in compliance with the order of the Supreme Court however, the",,
remaining funds available with the defendant No.4 are ₹16,21,692/- only and hence the defendant No.4 is not in a position to deposit the balance",,
amount. Further the sale of flats of defendant No.4 is also not possible as the construction has stopped for the project since some time. Hence the,,
present application seeking mandatory injunction against the plaintiffs with the prayers as noted above.,,
8. Case of the applicants herein broadly seeking inter alia the grant of mandatory injunction directing plaintiff No.2 to allow defendant No.4 to,,
undertake the business and affairs including raising finances is that the development of the project of defendant No.4 being a residential project known,,
as 45, Nirwana Hills at Erandwane, Pune (in short “the projectâ€) which has come to a virtual standstill since January, 2019. Defendant No.4",,
company is a Special Purpose Vehicle pursuant to a joint venture between defendant No.3 and Xander/plaintiff No.2. Further defendant No.3 is a,,
flagship company of Kumar Group led by defendant No.1 and defendant Nos.1 and 3 are the 99% shareholders of defendant No.4 and have thus filed,,
the present application in the representative capacity of defendant No.4. Defendant No.3 besides owning the land in the project has also invested a,,
total sum of ₹131.98 crores in defendant No.4 by way of interest bearing loans Series B debentures etc. These amounts are due to be paid with,,
interest by defendant No.4 to defendant No.3. In view of the “reserved matters†which require the affirmative vote of plaintiff No.2 as recorded,,
in the transaction documents and the subsequent obstructive conduct of the plaintiffs the business and functioning of defendant No.4 has come to a,,
standstill. Therefore the defendant No.4 is not in a position to raise funds to deposit the same in compliance of the orders of the Honâ€ble Supreme,,
Court. In case the amount of ₹4 crores is not deposited by 15th June, 2020 the defendant No.4 company could be rendered insolvent and defunct",,
thereby causing substantial loss not only to defendant No.1 and 3 but also to the plaintiffs.,,
9. In view of the “reserved matters†agreed to between the plaintiffs and defendant No.4 no major decision in regard to project can be taken,,
without prior written approval of the plaintiff No.2. Under the Debenture Trust Deed (DTD) and the amended Article of Association (AOA), plaintiff",,
No.2 has a right to appoint the majority Directors on the Board of defendant No.4 and from 2nd March, 2015 onwards till 31st September, 2019 the",,
plaintiff No.2 was in control of the management of defendant No.4. All the nominee Directors of plaintiff No.2 resigned from the Board w.e.f. 31st,,
September, 2019 so as to wriggle out of the rigours of RERA and other laws. The plaintiff No.2 has also not chosen to appoint any Director on the",,
Board of defendant No.4 since 31st September 2019. Since in the suit the defendant No.4 is not being represented by any Advocate the applicants,,
being the 100% shareholders of defendant No.4 have filed the present application in the representative capacity of defendant No.4 to secure its,,
beneficial interest and recognised investment. In compliance with the terms relating to “reserved matters†defendant No.4 sought consent of,,
plaintiff No.2 for conducting its affairs including for reviving the project however, the plaintiff No.2 taking advantage of its own wrong is declining the",,
said proposals and as many as 75 flat buyers have filed complaints before Police, RERA and Consumer Forum etc. There is no allegation of siphoning",,
of any funds by the applicants and since the defendant No.4 does not have sufficient funds, the applicants be permitted to raise funds so as to comply",,
with the order of the Supreme Court.,,
10. Learned counsel for the plaintiffs opposing the relief sought for including the part relief contends that the defendant No.4 had appointed POSCO,,
as its contractor when defendant Nos.1 and 3 were in total control of the management till 15th January, 2018. Seeing that the defendant Nos.1 and 3",,
were not managing the affairs of defendant No.4 properly, a Board Resolution dated 15th January, 2018 was passed providing for an independent",,
management however, since the said management of professionals left the work defendant Nos.1 and defendant No.3 continued to manage the affairs",,
of defendant No.4. The applicants terminated the contract of POSCO in March, 2016 when the applicants were in full control of the management and",,
thus in equity nor in law the applicants were absolved of their liability. The litigation between POSCO and defendant No.4 fructified the Board,,
Resolution before 15th January, 2018 resolution and the liability in respect of the said litigation continued on defendant No.1 which fact has been",,
specifically mentioned in the said Resolution.,,
11. Plaintiffs are debenture shareholders of defendant No.4 and by virtue of the Debenture Subscription Agreement (DSA) for Series “Aâ€,,
debentures executed on 5th December, 2014 the plaintiffs were issued 160 debentures for a value of ₹1 crore each on 2nd March, 2015 for a period",,
of 16 months. The DSA supersedes all earlier documents and thus the reliance of the applicants on the Terms Sheet which was agreed between the,,
parties in the year 2013 and was to expire in 180 days is wholly incorrect. The Term Sheet extended till December, 2014 and was superseded by the",,
DSA. Further the Term Sheet is a non-binding, unstamped and invalid document which expired in December 2014. Plea of the applicants that the",,
associate companies of the plaintiffs were also required to subscribe equity shares and having not invested in equity shares thereby causing loss to the,,
defendant No.3 and defendant No.4 is a dishonest plea for the reason there was no agreement between the parties for investment in equity as the,,
DSA superseded the Term Sheet. Further this grievance was never raised by the applicants and only when in the month of 2019 the plaintiffs issued,,
notice of default to the applicants, a suit was filed in Pune to circumvent the plaintiffs†actions against the defendants. Further even by the resolution",,
dated 15th January, 2018 defendant No.1 was absolved to the limited extent of maintenance of customer relationship, delay in the project and any",,
workman related issue or any accident however, defendant No.3 was never absolved. Further defendant No.1 was also not absolved of any other",,
duties cast on him and specifically the liability with regard to the POSCO litigation. Referring to various provisions in the DSA, the schedule thereto",,
and the resolution, learned counsel for the plaintiffs submits that the relief sought by the applicants is not maintainable.",,
12. The applicants have not challenged the provisions of DSA till date. The plaintiffs are secured creditors and have first charge with the right to sell,,
or create charge on the project of defendant No.4 and POSCO being at best an unsecured creditor cannot have precedence over the rights of the,,
plaintiffs. The applicants had filed an application before this Court which application has not been listed, advance copy whereof has been served on",,
the plaintiffs, seeking modification of the interim injunction granted wherein the applicants have clearly stated that defendant No.3 is in a position to",,
generate the funds to the extent of ₹420 crores from its assets and would be still left with ₹400 crores. Hence defendant No.3 have sufficient means,,
to comply with the directions of the Honâ€ble Supreme Court. The applicants are not entitled to any relief from this Court in view of their repeated,,
non-compliances of the order having not filed their affidavits in terms of the directions of this Court. Further the documents annexed with the present,,
affidavit stating that Mapletree is willing to raise a loan if charge is created on three flats also shows that Mapletree has stated that it cannot give loan,,
if the construction work does not start. Since January, 2019 the construction of the project of defendant No.4 is stalled. Further the reliefs sought by",,
the applicants in the present application are barred in terms of Section 241 read with Section 430 of the Indian Companies Act.,,
13. The submission of learned counsel for the applicants that the defendant Nos.1 to 3 have invested a sum of ₹130 crores by Series B non-,,
convertible debentures (in short “Series B NCDsâ€) is wholly incorrect as defendant Nos.1 to 3 hold Series B NCD of defendant No.4 for an,,
amount of ₹17 crores only. The plaintiffs are the only secured lenders of the defendant No.4 and no joint venture partnership was ever executed,,
between the plaintiff No.2 and the defendant Nos.1 to 4. The valid binding and admitted transaction documents between the parties clearly provide for,,
obligations of defendant Nos.1 to 4 jointly and severely to (i) obtain all requisite approvals, licenses, permissions; (ii) develop and construct the project;",,
(iii) redeem and pay the entire loan along with interest and all redemptions amounts to the plaintiff No.2; (iv) personal guarantees of defendant Nos.1,,
and 2; (v) securities created in favour of the lender/plaintiff No.2 to secure the loan amounts and; (vi) all of the defendant Nos.1 to 4 are jointly and,,
severely liable to pay amount to defendant No.2. There is no obligation of the plaintiff No.2 to contribute either in equity or extend any further loan to,,
defendant No.4. The sale/allotments of the apartments as informed during the course of the arguments in the project were made prior to the,,
disbursement of the loan by plaintiff No.2, that is, before 2nd March, 2015 and the submission of learned counsel for the applicants that the apartments",,
were allotted/sold between 2015 to 2018 is factually incorrect. Even if there is a liability of POSCO on defendant No.4 the same is at best like an,,
unsecured creditor and cannot triumph the rights of plaintiff No.2 who is a secured creditor.,,
14. Learned counsel for the plaintiffs contends that a party who has not purged the contempt till date has no right of hearing as despite directions of,,
this Court to file an affidavit by the defendant Nos.1, 2 and 3 in terms of the decision of this Court in M/s Bhandari Engineers & Builders Pvt. Ltd. vs.",,
M/s Maharia Raj Joint Venture & Ors., Execution Petition No.275/2012 decided on 5th December, 2019, no affidavit has been filed. As regards the",,
affidavit of assets filed earlier by defendant Nos.1 and 3 the plaintiffs have pointed out how there was embezzlement of funds. It is further contended,,
that the present application is not maintainable in the civil suit as the jurisdiction, if any, to adjudicate on the disputes regarding a company vests with",,
NCLT and NCLAT. In terms of Section 231 of the Companies Act read with Section 430 of the Companies Act, present application is liable to be",,
dismissed. Reliance is placed on the order dated 8th January, 2019 passed by the Supreme Court in Civil Appeal Nos.1965-1966/2014 Shashi Prakash",,
Khemka vs. NEPC Micon. Reliance is also placed on the decision rendered by this Court reported as [(2019 (176) DRJ 554] Vijay Chhibber and Ors.,,
vs. Delhi Gymkhana Club Ltd.,,
15. It is further contended that the express terms of a contract cannot be ignored. By the express terms of the contract the plaintiffs are the first and,,
only secured creditors of defendant No.4 and the loan extended by the plaintiffs is required to be returned in the first instance. The lender has the first,,
right on the borrowerâ€s assets and this right of the lender is required to be protected. Defendant Nos.1 and 3 have filed the present application in,,
derivative capacity on behalf of defendant No.4 and hence also the application is not maintainable. Reliance is placed on the decisions reported as,,
2011 (11) SCC 524 State Bank of Travancore vs. Kingston Computers India Pvt. Ltd. and 1990 (41) DLT 633 Baker Oil Tools (India) Pvt. Ltd. vs.,,
Baker Hughes Ltd. & Anr. and Nibro Limited vs. National Insurance Co. Ltd. The present application seeks a mandatory injunction and the relief,,
sought in the present application cannot be granted even as a final relief in the present suit filed by the plaintiffs and hence no interim relief can be,,
granted. Reliance is placed on decision in Gurcharan Singh vs. Saraswati Mishra, FAO (OS) 387/2015 dated 19th February, 2016. Since parties are",,
governed by the terms of contract, the terms of contract cannot be overridden by the plea of equity. Further the conduct of the defendant Nos.1 and 3,",,
itself disentitles it for any relief on equity. Reliance is placed on the decision reported as AIR 1974 Del 207 Raman Hosiery Factory, Delhi vs. J.K.",,
Synthetics Ltd.,,
16. Learned senior counsel for the applicant rebutting the arguments of learned counsel for the plaintiff contends that the present application before,,
this Court in the present proceedings is maintainable. Every dispute involving a company is not liable to be decided as per the Companies Act. The,,
jurisdiction of the Courts to try all suits of civil nature is very expensive as is evident from the plain language of Section 9 of the CPC. The two tests,",,
relevant in dealing with the question about the exclusion of civil courts' jurisdiction are (a) whether the special statute which excludes such jurisdiction,,
has used clear and unambiguous words indicating that intention; and (b) does that statute provide for an adequate and satisfactory alternative remedy,,
to a party that may be aggrieved by the relevant order under its material provisions. Reliance is placed upon the decisions of the Supreme Court,,
reported as AIR 1969 SC 78 Dhulabhai v. State of M.P.; (2009) 4 SCC 299 Rajasthan SRTC v. Bal Mukund Bairwa (2); (2002) 6 SCC 41D6h ruv,,
Green Field Ltd. v. Hukam Singh.,,
17. It is further contended that on a plain reading of Section 430 of the Companies Act it is clear that the civil Courtâ€s jurisdiction is not ousted in so,,
far as the relief of injunction against the person from interfering with the smooth management of the company and its affairs by the directors of the,,
said company is concerned. Reliance is placed on the decisions reported as 2016 SCC OnLine Del 512 Rajeev Saumitra v. Neetu Singh and [2016],,
195 CompCas 209 (Kar) Ravindra Veer Singh v. TBH Breweries India Private Limited. Section 430 of the Companies Act is only applicable if the,,
relief sought before the civil Court can be granted by the NCLT. The jurisdiction of the civil Court cannot be ousted so as to create multiplicity of,,
proceedings. Reliance is placed on 2016 SCC OnLine Bom 14089 Dhirubai v. Lataben Abuwalla. It is further stated that the jurisdiction of the,,
Company Law Board (now NCLT) in relation to Section 397 of the Companies Act is a concurrent jurisdiction which may be exercised by civil courts,,
where allegations pertaining to oppression and mismanagement partake the character of a civil dispute. Reliance is placed on the decision of this Court,,
in (2007) 93 DRJ 318 Norma (India) Ltd. v. Sameer Khandelwal.,,
18. Rebutting the argument of learned counsel for the plaintiff in respect to the non-maintainability of an application seeking mandatory injunction,,
under Order XXXIX Rule 1(a) CPC by the defendants in the absence of a counter claim, learned counsel for the applicants contends that under Order",,
XXXIX Rule 1(a) CPC if it is proved by affidavit or otherwise that any property in dispute in a suit is in danger of being wasted, damaged or alienated",,
by any party to the suit or wrongfully sold in execution of a decree, then the Court may grant a temporary injunction to restrain such an act or make",,
such other order for the purpose of saving and preventing the wasting, damaging, alienation, sale, etc. of the property. Reliance is placed on the",,
decisions reported as (1997) 41 DRJ 26 (DB) Liberty Sales Services v. Jakki Mull & Sons; (2012) 127 DRJ 456 Surakshit Exports Private Ltd. v.,,
GCG Transglobal Housing Project; AIR 2015 Kar 13 Shakunthalamma v. Kanthamma and AIR 1992 Bom 24 Nanasaheb v. Dattu.,,
19. It is also contended that this Court has power by virtue of Order XXXIX Rule 2 CPC to issue temporary injunctions in a mandatory form. Reliance,,
is placed on (1990) 2 SCC 117 Dorab Cawasji Warden v. Coomi Sorab Warden and (2012) 131 DRJ 492 Gulshan Sethi v. Rajan Dhall.,,
20. In response to the claim of learned counsel for the plaintiffs that the defendant No.1 and 3 have no right to represent defendant No.4, learned",,
counsel for the applicants states that defendant No.3 being 99% shareholder of defendant No.4 can bring an action on behalf of defendant No.4 in,,
representative capacity, in case the wrongdoers themselves control the company or if the directors are in the wrong and carry out the affairs of the",,
company in a prejudicial manner. [see (2002) 3 CompLJ 331 (Del) Spectrum Technologies USA Inc. v. Spectrum Power Generation Company Ltd.,,
and ILR [1976] MP 30 : 1975 MPLJ 390 Prakashchandra Rajmal Jain v. Firm Swarupchand Hukumchand and Co.],,
21. Heard learned counsel for the parties.,,
22. Present suit has been filed by Vistra ITCL (India) Ltd. and Ammon Holdings Pte. Ltd. as plaintiff Nos.1 and 2 respectively impleading Lalit,,
Kumar Jain, Pranay Lalit Kumar Jain, Kumar Urban Development Private Limited (in short “KUDPLâ€), Sinew Developers Pvt. Ltd. (in short",,
“SDPLâ€) and Kumar Housing Corporation Pvt. Ltd. (in short “KHCPLâ€) as defendant Nos.1 to 5 respectively.,,
23. Case of the plaintiffs is that a resolution dated 3rd December, 2014 was passed by the Board of Directors and Shareholders of SDPL in relation to",,
raising of funds by way of issuance of non-convertible debentures (NCDâ€s) on a private placement basis in two tranches. On 5th December, 2014",,
Series A debenture Subscription agreement Series A ( in short DSA) was executed between the plaintiff No.2 and defendant Nos.1, 2, 3 and 4.",,
Under Series A DSA the plaintiff No.2 had a right and option in its sole and absolute discretion to subscribe to senior, rated, redeemable, transferable",,
and interest bearing, cumulative NCDs in the defendant No.4, that is, 160 Series A Debentures of INR 1 crore in Series A Tranche-1 and 40 Series A",,
Debentures of INR 40 crores in Series A Tranche-2. On 5th December, 2014 another DSA being Series “C†DSA was executed between the",,
plaintiff No.2 and defendant Nos.1 to 4 whereby the plaintiff No.2 had the right and option in its sole discretion to subscribe to the debentures of,,
defendant No.4, that is, 35 Series C Debentures of INR 1 crore each aggregating to INR 35 crores, that is, Series C Tranche-I and upto 45 Series C",,
Debentures of INR 1 crore each aggregating to INR 45 crores, that is, Series C Tranche-2.",,
24. The primary purpose of the funding of the plaintiffs in defendant No.4 was mentioned in the Series A DSA and Series C DSA which was to,,
undertake development, construction, marketing and sale of residential project with a total carpet area including the terrace and balcony area of not",,
less than 8,16,281 sq.ft. on the land measuring 8,960 sq.mtrs that is the project land. In furtherance of Series A DSA and Series C DSA vide the",,
Debenture Trust Deeds executed by defendant No.1 to 4 and the plaintiff No.1, defendant No.4 appointed plaintiff No.1 as the trustee for the benefit",,
of plaintiff No.2 and to act as an agent of plaintiff No.2 to enforce the provisions of the transaction documents of the Series A DTD, Series C DTD",,
and the transaction documents.,,
25. In furtherance of Series A DSA, Series C DSA and the Debenture Trust Deeds, the Share Pledge Agreements were executed by defendant",,
Nos.1 to 4 in favour of plaintiff No.1 on 3rd February, 2015. Besides the defendant Nos.1 and 2 also executed their Deed of Personal Guarantee in",,
favour of plaintiff No.1, who was acting on behalf of plaintiff No.2 on 3rd February, 2015 itself. Consequently, the plaintiff No.2 subscribed to 160",,
Series A Debentures issued by defendant No.4 and remitted a sum of ₹160 crores in favour of defendant No.4. On 2nd January, 2018 first",,
Amendment Agreement to the Series A DSA and Series C DSA were carried out as also to the Series A DTD and Series C DTD. Plaintiff No.2,,
thus subscribed to 30 unlisted redeemable, interest bearing Series C Debentures and remitted an amount of ₹30 crores to defendant No.1. Thus the",,
total investment of plaintiff No.2 with defendant No.4 was a sum of ₹190 crores. After the subscription of the debentures by the plaintiff No.2 in,,
defendant No.4, defendant Nos.1 to 4 continuously defaulted in complying with their obligations resulting in plaintiffs issuing a default notice being",,
Series A default notice on 5th October, 2018 and Series C default notice on 11th October, 2018.",,
26. As the project was suffering the Board of Directors of defendant No.4 vide its Board Resolution No.19/2017-2018 dated 15th January, 2018",,
appointed an independent management team of professionals to aid the defendant Nos.1 to 3 to expedite the development, construction, marketing and",,
sale of the project. However, due to subsequent events the independent management team fearing for their life, safety and career resigned from their",,
posts for the reason there were various threats, hindrances and obstacles at the project site. The parties thereafter exchanged replies to the notice and",,
the rejoinder thereto whereafter the defendant Nos.1 to 3 filed a civil suit   before the District Court Pune seeking a restraint on the plaintiff Nos.1,,
and 2 from exercising its rights under the transaction document wherein no interim order was passed in favour of defendant Nos.1, 2 and 3 herein.",,
The plaintiff No.2 has already filed an application under Order VII Rule 11 CPC for rejection of the said plaint. On 22nd May, 2019 the plaintiff No.1",,
issued a demand notice under the Deed of Personal Guarantee for Series A and Series C debentures of defendant Nos.1 and 2 to make payments of,,
the redemption amounts. Since despite issuance of demand notice, no action was taken by defendant Nos.1 and 2 the plaintiffs have filed the present",,
suit.,,
27. When this suit came up before this Court vide order dated 28th May, 2019 this Court granted an injunction in favour of the plaintiffs noting that",,
prima facie the defendants have defaulted in complying with the terms of agreement. The operative portion of the order dated 28th May, 2019 passed",,
by this Court reads as under:,,
24. In view of the aforesaid facts, the Court is satisfied that Plaintiffs have made a prima facie case and the balance of convenience also",,
lies in favour of the Plaintiffs and irreparable loss would be caused to them in case injunction is not granted. Huge amount have been,,
expended by the Plaintiffs. Defendants prima facie appear to have defaulted in complying with the terms of agreement. The prayers sought,,
in the plaint are for protection of the securities given under the transaction documents. Defendant Nos. 1to 3are signatories to the loan,,
credit documents and are jointly and severally liable for the amount due from Defendant No.4. Accordingly, till the next date of hearing,",,
protecting the securities which have been pledged and the negative covenant contained in the agreement, Defendant Nos. 1 and 2 the",,
guarantors, along with Defendant 3, are restrained from transferring, alienating, selling, parting with, disposing of, creating third party",,
rights or interests or otherwise encumbering in any manner whatsoever any and all movable and immovable assets, shares, properties or",,
any other assets.,,
25. Defendant Nos. 1to 3and 5are further restrained from transferring or permitting to transfer or attempting to transfer any pledged,,
shares, being 22,20,000 equity shares held in a dematerialized form, constituting 74% of the share capital of Defendant No. 5in any",,
manner. Defendant Nos. 1to 4 are further restrained from or permitting a Transfer or attempting to Transfer any Pledged Shares, being",,
65,00,000 equity share constituting 100% of the share capital of Defendant No.4.",,
28. Vide order dated 30th July, 2019 this Court decided the question regarding the viability of the security option given by the defendants, to secure the",,
amount claimed by the plaintiffs in the present suit till final adjudication of the injunction application and modified the order dated 28th May, 2019 as",,
under:,,
42. Till the application is heard and decided, the Court will also have to ensure that Defendant No. 3 does not fetter away its assets to",,
render the Plaintiff without any effective recourse. Having given my thoughtful consideration on every aspect, I feel that since the security",,
being offered by the Defendants in the nature of Options 1, 2 & 3 cannot be accepted, the alternate proposal of depositing an amount, in a",,
separate no lien account, generated from the sale of each flat or unit from any of Defendant No. 3’s ongoing project or projects",,
proposed to be launched in future, till further orders of this Court, is a more viable and a purposeful approach in the current scenario.",,
Thus, notwithstanding the rejection of the options given by Defendants, till such time the Court takes a final decision on the application, it is",,
necessary that an urgent relief be granted to Defendant Nos. 1 to 3 by way of modification/ variance/ clarification of the order dated 28th,,
May 2019, so that they can undertake further development of the ongoing projects. Defendant Nos. 1 to 3 have volunteered to deposit 10%",,
of the amount, in a separate no lien account. However, in order to balance the equities and in the interest of justice and having regard to",,
the facts of the case as noted above, it would be appropriate to order Defendant Nos. 1 to 3 to deposit of 25% of the amount generated, in",,
a separate no lien account, from the sale of each flat or unit from any of Defendant No. 3's ongoing project or projects proposed to be",,
launched in future, either independently or under a joint venture or partnership etc. It is further clarified that the amount generated from",,
sale of each flat or unit should be construed to mean and include all amounts received whether, in the form of booking amount, part-",,
payment or final payment, received on or after 31st July 2019. These amounts shall not be utilized for any purpose without the permission of",,
the Court.,,
43. The above condition shall be strictly adhered to by Defendant Nos. 1 to 3, and they shall submit the amounts in the Court on a",,
fortnightly basis. The above condition shall be implemented subject to the Defendant Nos. 1 to 3 filing an affidavit, giving complete details",,
of the sale transaction that were executed on or after the date of passing of the order dated 28th May 2019 with full particulars as to the,,
details of the property, the amount received thereunder from the prospective purchaser and the balance amount due, along with the list of",,
its ongoing projects and their stage of construction. Defendant Nos. 1 to 3 must also furnish affidavits for any future project that,,
Defendant No. 3 would undertake in the future, until further orders of this Court. Further, Defendant No. 3 will continue to be restrained",,
from alienating/selling any lands held by the Defendant No. 3 without permission of the Court, as mentioned in their note of submissions.",,
44. This affidavit shall be filed within a period of one week from the date of the passing of the order.,,
45. Subject to the above, the order dated 28th May 2019 is modified / clarified to the effect that it does not restrict Defendant No. 3 to carry",,
out its routine/ordinary course of business which includes the construction and development of its projects, undertake sale of flats/units",,
being developed by Defendant No. 3 and to receive sale proceeds therefrom; enter into fresh development agreements, joint ventures",,
agreements and to receive consideration therefrom. However, the sale of flats/Units being developed by Defendant Nos. 1 to 3, is subject to",,
the above-mentioned conditions. Defendants have sought further clarification by way of seeking permission to undertake corporate,,
restructuring in the nature of Mergers and Amalgamations with Defendant No. 3. However it is not within the purview of this Court to,,
expand or dilute the scope of its own order by way of a clarification to its previous order and therefore no clarification is necessary on the,,
above aspect.,,
46. Needless to say that this order only clarifies the injunction order dated 28th May 2019 as modified on 9th July 2019 and the opinion,,
expressed by the Court is only a prima facie view and contentions of the parties and merits of their case shall be examined uninfluenced by,,
the observations made in this judgment.,,
29. Thus, so that further development of the ongoing project takes place, vide order dated 30th July, 2019, the defendant Nos.1 to 3 were directed to",,
deposit 25% of the amount generated from any of the defendant No.3â€s ongoing project/projects proposed to be launched in future either,,
independently or under joint venture in a no lien account. Further defendant No.3 would continue to be restrained from alienating, selling any land held",,
by defendant No.3 without prior permission of the Court. Thus as regards the property of defendant No.4 there was no interim order passed and thus,,
the same would be governed by the contractual rights between the parties.,,
30. To ascertain the rights arising out of the DSA between the parties, it would be appropriate to note the relevant portions of the DSA:",,
“DEBENTURE SUBSCRIPTION AGREEMENT,,
AMONGST,,
AMMON HOLDINGS PTE LTD,,
AND,,
LALIT KUMAR JAIN,,
AND,,
PRANAY LALITKUMAR JAIN,,
AND,,
KUMAR URBAN DEVELOPMENT PRIVATE LIMITED,,
AND,,
SINEW DEVELOPERS PRIVATE LIMITED,,
1. DEFINITIONS AND PRINCIPLES OF INTERPRETATIONS,,
1.1 Definitions:,,
Project"" shall mean the development, construction, marketing and sale of the residential project with a total Carpet Area (including the",,
terrace and balcony area) of not less than 8,16,281 (eight lakhs sixteen thousand two hundred eighty one) square feet on the Project Land,",,
comprising of 4 (four) free sale buildings bearing nos. C1 to C4, the units/ flats in which shall be available for sale to the public, which is",,
being/ proposed to be undertaken using the Vested FSI as per the approvals and sanctions already received and the Additional FSI that,,
shall be available for the Project, and more specifically described in Schedule II;",,
XXX XXX XXX,,
16.6 Entire Understanding.,,
This Agreement along with the Transaction Documents constitutes the whole agreement between the Parties and supersedes any previous,,
oral agreements, understandings, negotiations and discussions between the Parties in relation to the matters dealt with in this Agreement",,
including the Debenture Subscription Agreement dated July 26, 2014 executed between the Parties, provided that this Section 16.6 shall not",,
exclude any liability for (or remedy in respect of) fraudulent misrepresentation by the Promoters. It is clarified that the Debenture,,
Subscription Agreement dated July 26, 2014 executed between the Parties stands terminated and replaced by this Agreement.",,
2.5 Tenor and Redemption.,,
2.5.1 The Series A Debentures shall have a maximum tenor of 60 (sixty) months from the Tranche1 Deemed Date of Allotment (""Tenor""). The",,
Company shall proportionately redeem all the Series A Debentures collectively through reduction in face value of each Series A Debentures,,
without distinguishing between the Series A Debenture Holders. An indicative schedule for redemption is set forth at Schedule XV hereto.,,
Notwithstanding anything contained in this Agreement, the Company shall mandatorily redeem all and not less than all of the Series A",,
Debentures in full by paying the entire Redemption Amounts on or before the expiry of the Tenor (""Final Redemption Date"").",,
2.5.2 Notwithstanding anything contained in this Agreement and without prejudice to all the rights and entitlements of the Series A,,
Debenture Holders under the Law or the Transaction Documents, (i) if an Event of Default has occurred and has not been rectified within",,
the Rectification Period to the satisfaction of the Series A Debenture Holders; or (ii) if the Company, by the expiry of the Final Redemption",,
Date, has not redeemed all and not less than all the Series A Debentures by paying the entire Redemption Amounts to the Series A Debenture",,
Holders; or (iii) if the Guarantors fail to or default in complying with the terms and conditions of the Personal Guarantee and, or, to fail to",,
fulfil or default in honouring the Personal Guarantee; then the Series A Debenture Holders shall be entitled to and shall have absolute,,
rights to the following, without prejudice to other rights and entitlements that they shall have under the applicable Laws or any other part of",,
this Agreement or under any other Transaction Documents or any other agreement:,,
(i) The Series A Debenture Holders shall have the unfettered, absolute and exclusive right and entitlement to, at any time without any further",,
consent of the Company or any of the Shareholders of the Company, to sell/ transfer/ convey/ lease/ sub-lease/ sub-let/ license or dispose-",,
off, in any manner whatsoever, the Project and, or, the Company or any part thereof, including without limitation by way of (a) sale/",,
transfer of all or any of the securities/ shares of the company (held by the Shareholders), without the consent of the Shareholders of the",,
Company; (b) sale/ transfer/ conveyance/ lease/ sub lease/ sub-let/ license or disposal of the Company's rights, entitlements and interest in",,
the Project Land, the Additional Leased Lands and the ATSL Land in any manner whatsoever; and (c) sale, transfer, conveyance, disposal",,
or any other commercial exploitation of developed areas, built up areas, unit$, flats, apartments, plots or developable areas or FSI/ FAR/",,
TDRs in the Project in any manner whatsoever, either by public auction or private contract or bulk sale or otherwise and with liberty to",,
make such conditions and stipulations on title or evidence of title or other matters as the Series A Debenture Holders may deem proper,,
without being liable or answerable or accountable for any loss or deterioration occasioned thereby. The Series A Debenture Holders shall,,
also have the right to seek the liquidation/ winding-up of the Company in accordance with the applicable Laws;,,
(ii) It is an express condition of these presents that the right to cause a sale/transfer/conveyance/ lease/ sub-lease/ sub-let/ license disposal,,
1.,Ownership,Xxx xxx
2.,Project Summary,Xxx xxx
Tranche,Amount,Milestone
1,"Rs.1,500
MM","Receipt of all approvals for commencement of
construction of 460,358 Sq. ft. FSI area 1 saleable
area of 700,000 Sq. ft. (refer Annexure for
computation of Saleable Area). This investment
amount may reduce on account of any downward
variation in FSI or saleable area as mentioned
above.
2.,Rs.500 MM,"Obtaining approval of building plans to build
7,15,763 Sq. ft. FSI totaling to saleable area of
1,009,689 Sq. ft. and achievement of at least a base
sales price of Rs. 9,500 / Sq. ft. for 25 new units
sold over and above 86 units already sold till date.
3.,Rs.350 MM,"Achieving base sales price of Rs. 11,000 / Sq. ft.
for 30 new units sold over and above those sold for
meeting the milestones for previous tranches.
4.,Rs.450 MM,"Project achieving base ales price of Rs. 12,000/ Sq.
ft. for 100 new units sold over and above those
sold for meeting the milestones for previous
tranches and receipt of 40% of the sale
consideration of these units. The Company will
have the option to request for disbursement of this
tranche within a fixed period of time as may be
specified in the definitive agreements.
Total,"Rs.2800
MM",
9.,Exclusivity,"Developer / Company and all their affiliates, management, related parties will
work exclusively with the Investor for 180 days from the date of execution of
the Heads of Terms or signing of the definitive agreements, whichever is
earlier. During this period. Developer / Company and all their affiliates
management, related parties shall not solicit investment, have discussions or
provide any information to any prospective third party investor in relation to
this transaction, without written approval from the investor, excluding for
availing any construction finance in the nature of Debt from Banks/Financial
Institutions etc. as well as swapping of Loan of Future Capital Holding
Limited with respect to the Project. However, prior to Investor's funding, there
will be no secured/ unsecured loans/ inter-corporate deposits in the Company
as is also mentioned in Clause 3. The period of exclusivity shall be extended
based on mutual consent.
RESOLVED FURTHER THAT with effect from the date of this resolution, the Independent Management and all employees of the Company will be",,
placed and shall work out of the site office of the Company or a separate office, as may be approved by the Board, except for Sudhir Kadam, Lata",,
Pokharkar, Girish Mande, and Sonica Tater and Mahesh Ram Patil.""",,
RESOLVED FURTHER TBLAT appointment of Ms. Sonica Tater, as the company secretary of the Company, is hereby approved. It is taken on",,
record that, Ms. Sonica Tater will be the company secretary of the Company, and shall at all times report to the Board and act as per the instructions",,
of the Board. Ms. Sonica Tater shall be responsible for compliance with applicable laws and regulations by the Company.""",,
RESOLVED FURTHER THAT it be taken on record that. Mr. Lalit Kumar Jain and KUDL (directly or indirectly or through its directors,",,
shareholders, employees, agents, representatives etc.) shall continue to have all rights as shareholders and director on the Board, as set out in the",,
Articles of Association of the Company and other agreements entered into by the Company. Subject to the conditions set out herein, Mr. Lalit Kumar",,
Jain with effect from the date of this resolution, shall not be liable for: (i) maintenance of customer relationships or customer communications in",,
relation to the Project; (ii) delays in the Project; or (iii) any workmen related or other accidents on the site of the Project.""",,
RESOLVED FURTHER THAT it be taken on record that the debenture holders shall continue to have all rights available to them under the Articles",,
of Association of the Company and other agreements entered into by them with the Company.""",,
RESOLVED FURTHER THAT it be taken on record that Mr. Lalit Kumar Jain, KUDL and Ammon Holdings Pte Ltd. have agreed that they shall,",,
(i) provide complete independence to the Independent Management to operate and manage the Project; (ii) promptly approve payments to be made by,,
the Company and not undertake any acts, omissions or deeds that may delay/ block payments to be made by the Company; and (iii) provide full co-",,
operation as may be required by the Company, the Board and the Independent Management including providing all necessary information, documents",,
etc., in relation to the Project and for obtaining all licenses, permits/approvals for the Company and the Project.""",,
RESOLVED FORTHER THAT it be taken on record that, (i) Mr. Lalit Kumar Jain and KUDL have agreed that they shall continue to handle all the",,
existing/ pending litigations filed by or against the Company, in respect of the Project or the underlying land or the slum rehabilitation buildings/ areas or",,
the larger parcel of the land of which the Project forms a part of, and all other litigations/ proceedings/ arbitration, etc., including without limitation by",,
or against the Dargah of Khwaja Peer Sayed Hisamuddin Kattal-E-Zanjani Chisti trust and its trustees, any Government authorities, the Charity",,
Commissioner, Waqf Board, Posco E&C India Private Limited, etc.; and (ii) the costs incurred in respect of the aforesaid litigations shall be borne by",,
the Company, subject to the prior approval of the Board. It is further approved that Ms. Madhu Goel and Mr.Muralidhar who are consultants",,
appointed by the Company for handling various litigations of the Company will continue their services with the Company.""",,
RESOLVED FURTHER THAT it be taken on record that any legal proceedings related to customers or any new matters related to the Project will",,
be handled by the Independent Management.""",,
RESOLVED FURTHER. THAT, in order to ensure that there is no sharing of resources/personnel by the Company with KUL and, or, KUL group",,
of companies or any other group company other than Sudhir Kadam, Lata Poklrarkar, Girish Mande, Sonica Tater and Mahesh Ram Patil, approval is",,
granted that: (i) all personnel/ employees of the Company will work exclusively for the Company, unless otherwise agreed as above or by KUDL and",,
the Series A Debenture Holders of the Company in writing; (ii) all of the personnel/ employees will be given new email addresses, visiting cards, etc.,",,
by the Company having no reference to KUL and, or, KUL group of companies. It is clearly agreed that the Company is a subsidiary of KUDL. It is",,
clarified that in line with the matters set out herein, this arrangement will not take away the rights available to KUDL, set out in the articles/",,
agreements in any manner. Further, any employee of the Company or nominees of the debenture holders shall not defame KUDL or Lalit Kumar Jain",,
or other group companies of KUDL. KUDL shall be entitled to name the Project as its project in all corporate and marketing material and also direct,,
customers to the sales team of the Company. Similarly, no employees or representatives of the Company, or of KUDL or KUL group of companies",,
shall defame Ammon Holdings Pte. Ltd. and, or, their affiliates or their representatives.""",,
RESOLVED FURTHER THAT, approval is hereby granted that the management of the entire finances and accounts of the Company (including the",,
Project) and all records, documents in relation thereto, be undertaken by a new team or third parties appointed by the Company with the approval of",,
the Board and the Series A Debenture Holders in writing; and upon appointment of such team/ third parties, all of the records of the Company",,
including without limitation pertaining to the secretarial affairs of the Company, the Project, finance and accounts of the Company (whether stored",,
physically or by providing digital access), shall be handed over to such new team/third parties. All Company records shall be made available promptly",,
to the debenture holders and the shareholders""",,
RESOLVED FURTHER THAT approval is hereby granted that the Company shall have its own new separate independent letter heads and also",,
have its own independent website including for the Project, having no reference to KUL/ KUDL and, or, KUL group of companies, Ammon Holdings",,
Pte Ltd. or its affiliates. It is clarified and taken on record that the Company i.e. Sinew Developers Private Limited is a wholly owned subsidiary,,
company of KUDL and as such, its mention will come wherever necessary.""",,
RESOLVED FURTHER THAT it being clarified and taken on record that Ammon Holdings Pte. Limited or its affiliates are not developer(s) of the",,
Project and will never be referred to as such in any communication by the Company, the shareholders or the Independent Management.""",,
RESOLVED FURTHER THAT Directors are hereby authorized on behalf of the Company to negotiate, alter, execute and sign all documents, deeds",,
and agreements and undertake all other actions required to give effect to all of the above resolutions.""",,
[Emphasis supplied],,
33. Learned counsel for the plaintiffs objecting to the maintainability of the present application relies upon Section 430 of the Companies Act which,,
bars the jurisdiction of the civil Court to entertain any suit or proceeding in respect of any matter which the Tribunal or the Appellate Tribunal under,,
the Companies Act 2013 is empowered to determine by or under the Companies Act or any other law for the time being in force and contends that no,,
injunction can be granted by any Court or authority in respect of any action taken or to be taken in pursuance of any power conferred by or under the,,
Companies Act.,,
34. Learned counsel for the plaintiffs relies upon the order of the Supreme Court in Shashi Prakash Khemka vs. NEPC Micon Civil Appeal Nos.,,
1965-1966 of 2014 decided on January 08, 2019. In the said order the Honâ€ble Supreme Court reiterated the bar under Section 430 of the Companies",,
Act, however what is required to be seen is whether the relief sought in the present application arises from a dispute between the parties which would",,
be amenable to the jurisdiction of the Tribunal or the Appellate Tribunal under the Companies Act so as to oust the jurisdiction of the civil Court.,,
Learned counsel for the plaintiffs has adverted to Section 241 of the Companies Act stating that in case oppression is alleged in regard to management,,
of the affairs of the company, then the remedy lies under Section 241 Companies Act and the present application would not be maintainable under",,
Section 430 of the Companies Act.,,
35. Section 241 of the Companies Act provides the remedy to any members of the company who complains that the affairs of the company has been,,
or are being conducted in a manner prejudicial to public interest or in a manner prejudicial or oppressive to him or any other member or members or in,,
a manner prejudicial to the interests of the company.,,
36. As held by the 7 Judge Bench of the Supreme Court in AIR 1965 SC 1942 Kamla Mills Ltd. v. State of Bombay the question about the exclusion,,
of the jurisdiction of the civil Court either expressly or by necessary implication must be considered, in every case, in the light of the words used in the",,
statutory provision on which the plea is rested, the scheme of relevant provisions, their object and their purpose. Where the exclusion of the civil",,
court's jurisdiction is expressly provided for, the consideration as to the scheme of the statute in question and the adequacy or the sufficiency of",,
remedies provided for by it may be relevant, it cannot, however, be decisive.",,
37. The two tests relevant in dealing with the question about the exclusion of the civil Courtâ€s jurisdiction are (a) whether the special statute which,,
excludes such jurisdiction has used clear and unambiguous words indicating that intention; and (b) does that statute provide for an adequate and,,
satisfactory alternative remedy to a party that may be aggrieved by the relevant order under its material provisions, as held by the Constitution Bench",,
in the decision reported as AIR 1966 SC 893 Ram Swarup v. Shikar Chand.,,
38. Dealing with Section 430 of the Companies Act, Karnataka High Court in Ravindra Veer Singh (supra) held:",,
“15. On a plain reading of Section 430 of the Companies Act, it is clear that the civil court's jurisdiction is not ousted insofar as the",,
relief of injunction against persons from interfering with the smooth management of the company and its affairs by the directors of the said,,
company is concerned. The defendants have already been removed in the meeting. The very grievance aired by the defendants before the,,
Board has not been taken into consideration, and it is held that the civil court is seized of the matter. Thus a simple suit for injunction",,
seeking the equitable relief of permanent injunction about the day-to-day management of the company and its affairs is maintainable.â€,,
39. Further, this Court in Norma (India) Ltd. (supra) held that where allegations pertaining to oppression and mismanagement partake the character of",,
a civil dispute, proceeding before the civil Court will be maintainable.",,
40. The present suit has been instituted by the plaintiffs against the defendant as noted above, inter alia, seeking a decree in favour of the plaintiff",,
No.1 and 2 and against the defendant No.1 to 4 jointly and severally for a sum of ₹160 crores being the principal sum of the Series A Debentures and,,
₹30 crores being the principal sum of Series C Debentures along with the interest thereon, which amounts to ₹250 crores and ₹8,30,00,000/-",,
approximately at the time of filing of the suit; decree of permanent injunction restraining defendants No.1 and 2 from selling, alienating, disposing of or",,
transferring their movable or immovable assets, shares, etc., injunction against defendant No.1 and 2 restraining them from taking any step adversely",,
affecting their net worth etc. Thus the relief sought in the present suit by the plaintiffs is recovery of money with interest, invested by plaintiff No.2 in",,
defendant No.4, enforcement of its right to recover from defendants No.1 and 2 who executed personal guarantee and restrain the transfer or attempt",,
to transfer any pledged shares of defendant No.4. It is in this suit that the applicants have filed the present application seeking a mandatory injunction,,
against the plaintiffs seeking their approval in terms of clause 15.14.1(iii) of the Articles of Association which mandates consent of plaintiff No.2 for,,
obtaining secured and unsecured finances/lending facilities by defendant No.4.,,
41. Case of the applicants seeking mandatory injunction is that in case approval of the plaintiff No.2 is not received in terms of the Shares Subscription,,
Agreement between the parties as also Articles of Association, the defendant No.4 company will suffer an irreparable loss as without creating a",,
charge on the three flats noted above, the defendant No.4 company would not be in a position to discharge its liability in terms of the decision of the",,
Supreme Court resulting in the award being enforced against the defendant No.4 company and the company would be liable to pay a sum of ₹45,,
crores. Thus, the relief sought by the applicant is not on the ground of oppression by the plaintiffs but that the inaction of the plaintiff No.2 would result",,
in loss to the defendant No.4 company. The reliefs sought both in the suit and the application partake the character of a civil dispute and the remedy,,
available under the Companies Act may not be an adequate and satisfactory alternative remedy.,,
42. Hence, in view of the nature of the reliefs sought by the applicants in the present application it cannot be held to be barred under Section 430 of",,
the Companies Act and that the applicants are required to be relegated to the proceedings under the Companies Act.,,
43. Learned for the plaintiffs has also objected to the maintainability of the present application by defendant Nos.1 and 3 on behalf of defendant No.4.,,
Claim of applicants/defendant Nos.1 and 3 is that since defendant No.3 is a 99% shareholder of defendant No.4, it is required to act in the best",,
interest of defendant No.4 and to save the immediate further liability of payment of a total sum of ₹45 crores, the defendant Nos.1 and 3 on behalf of",,
defendant No.4 responded to the Special Leave Petition in the Supreme Court filed by the contractor POSCO wherein the order of injunction passed,,
by the Bombay High Court was modified directing defendant No.4 to deposit a sum of ₹5 crores. Thus the defendant No.3 as 99% shareholder can in,,
representative capacity file the present application.,,
44. In Prakashchandra Rajmal Jain (supra), the Madhya Pradesh High Court held that a shareholder is entitled to institute a suit in the representative",,
capacity on behalf of the minority shareholders, when the minority are overborne by the vote of the majority, and one of the three things is established,",,
that is, (i) where the act complained of is ultra vires the company; (ii) where the act complained of is a fraud on the minority; or (iii) when there is an",,
absolute necessity to waive the rule in order that there may not be a denial of justice.,,
45. As per the applicants, the act of plaintiffs in declining to accede to the request of the defendant Nos.1 and 3 for deposit of a sum of ₹4 crores by",,
defendant No.4 by creating a charge on its properties, which it could have done only with the approval of the plaintiffs, though not an act complained",,
of as ultra vires the company or an act of fraud on minority but would fall in the category of absolute necessity to waive the rule in order that there,,
may not be a denial of justice. The applicants have pleaded that in case the sum of ₹4 crores is not deposited by 15th June, 2020 by creating charge on",,
the flats of the defendant No.4, the defendant No.4 company, would suffer an irreparable loss. Thus this Court has no hesitation in holding that the",,
defendant No.3 as the 99% shareholder of defendant No.4 due to the necessity pleaded in the application in the interest of defendant No.4 can file the,,
present application in the representative capacity.,,
46. As regards the objection of learned counsel for the plaintiffs with respect to the present application seeking a mandatory injunction against the,,
plaintiff No.2, in particular without filing a counter claim being not maintainable in the present suit, learned counsel for the applicants rely on Order",,
XXXIX Rule 1(a) and stateS that under the said provisions relief can be sought by any party in case the property in dispute is in danger. Order,,
XXXIX Rule 1 CPC reads as under:,,
“Order-XXXIX, Rule-1. Cases in which temporary injunction may be granted.-",,
Where in any Suit it is proved by affidavit or otherwiseâ€",,
(a) that any property in dispute in a suit is in danger of being wasted, damaged or alienated by any party to the suit, or wrongfully sold in",,
execution of a decree, or",,
(b) that the defendant threatens, or intends, to remove or dispose of his property with a view to defrauding his creditors,",,
(c) that the defendant threatens to dispossess the plaintiff or otherwise cause injury to the plaintiff in relation to any property in dispute in,,
the suit, the court may by Order grant a temporary injunction to restrain such act, or make such other Order for the purpose of staying and",,
preventing the wasting, damaging, alienation, sale, removal or disposition of the property or dispossession of the plaintiff, or otherwise",,
causing injury to the plaintiff in relation to any property in dispute in the suit] as the court thinks fit, until the disposal of the suit or until",,
further orders.â€,,
47. Supreme Court in Dorab Cawasji Warden (supra) dealing with the issue as to when a Court can grant interlocutory mandatory injunction laid down,,
the following principles:,,
15. In one of the earliest cases in Rasul Karim A Anr. v. Pirubhai AMrbhm, ILR 1914 38 Bom. 381, Beaman, J. was of the view that the",,
court's in India have no power to issue a temporary injunction in a mandatory form but Shah, J. who constituted a Bench in that case did",,
not agree with Beaman, J. in this view. However, in a later Division Bench judgment in Champsey Bhimji & Co. v. The Jamna Flour Mills",,
Co. Ltd., MANU/MH/0046/1914 , two learned Judges of the Bombay High Court took a different view from Beaman, J. and this view is now",,
the prevailing view in the Bombay High Court. In M. Kandaswami Chetty v. F. Subramania Chetty MANU/TN/0050/1917, a Division Bench",,
of the Madras High Court held that court's in India have the power by virtue of Order 39 Rule 2 of the CPC to issue temporary injunction in,,
a mandatory form and differed from Beaman's view accepting the view in Champsey Bhimji & Co. v. Jamna Flour Mills Co. (supra). In Israil,,
v. Shamser Rahman MANU/MH/0046/1914, it was held that the High Court was competent to issue an interim injunction in a mandatory",,
form. It was further held in this case that in granting an interim injunction what the Court had to determine was whether there was a fair,,
and substantial question to be decided as to what the rights of the parties were and whether the nature and difficulty of the questions was,,
such that it was proper that the injunction should be granted until the time for deciding them should arrive. It was further held that the,,
Court should consider as to where the balance of convenience lie and whether it is desirable that the status quo should be maintained.,,
While accepting that it is not possible to say that in no circumstances will the Courts in India have any jurisdiction to issue an ad interim,,
injunction of a mandatory character, in Nandan Pictures Ltd. v. Art. Pictures Ltd. and Ors.} MANU/WB/0126/1956: AIR1956Cal428 a",,
Division Bench was of the view that if the mandatory injunction is granted at all on an interlocutory application it is granted only to restore,,
the status quo and not granted to establish a new state of things differing from the state which existed at the date when the suit was,,
instituted.,,
16. The relief of interlocutory mandatory injunctions are thus granted generally to preserve or restore the status quo of the last non-,,
contested status which preceded the pending controversy until the final hearing when full relief may be granted or to compel the undoing of,,
those acts that have been illegally done or the restoration of that which was wrongfully taken from the party complaining. But since the,,
granting of such an injunction to a party who fails or would fail to establish his right at the trial may cause great injustice or irreparable,,
harm to the party against whom it was granted or alternatively not granting of it to a party who succeeds or would succeed may equally,,
cause great injustice or irreparable harm, courts have evolved certain guideline. Generally stated these guidelines are:",,
(1) The plaintiff has a strong case for trial. That is, it shall be of a higher standard than a prima facie case that is normally required for a",,
prohibitory injunction.,,
(2) It is necessary to prevent irreparable or serious injury which normally cannot be compensated in terms of money.,,
(3) The balance of convenience is in favour of the one seeking such relief.,,
17. Being essentially an equitable relief the grant or refusal of an interlocutory mandatory injunction shall ultimately rest in the sound,,
judicial discretion of the Court to be exercised in the light of the facts and circumstances in each case. Though the above guidelines are,,
neither exhaustive or complete or absolute rules, and there may be exceptional circumstances needing action, applying them as prerequisite",,
for the grant or refusal of such injunctions would be a sound exercise of a judicial discretion.,,
[Emphasis supplied],,
48. In the decision reported as (AIR 1975 Karn. 137) Suganda Bai v. Sulu Bai relied upon by learned counsel for the applicants, the Karnataka High",,
Court quoted Lopes LJ in Carton v. Fey (1894(2) Ch. 541 (CA) (at 545) as follows:,,
“The question is this whether the defendant can move an injunction against the plaintiff without filing a counter claim or issuing a writ in,,
a cross action. In my opinion, he can in some cases, but only in cases where the defendants claim to relief arises out of the plaintiff's cause",,
of action, or is incidental to it.â€",,
[Emphasis supplied],,
49 . From the decisions qua the grant of mandatory injunction noted above the following principles emerge i.e., firstly, the relief of mandatory",,
injunction sought as an interim injunction should be capable of being granted as a final relief, secondly, the applicants should have a strong case for trial",,
which is a standard higher than the prima facie case, thirdly the mandatory injunction at an interlocutory stage is required to be granted only to restore",,
the status-quo ante and not to establish a new state of things differing from the state which existed on the date when the suit was instituted and,,
fourthly, if the defendants seek a mandatory injunction without filing a counter claim, the said relief must arise out of the plaintiffs†cause of action or",,
the reliefs incidental thereto.,,
50. Applicants in the present application are defendant No.1 and 3 in the suit who are acting in representative capacity of defendant No.4. As noted,,
above, the present suit has been filed by the plaintiffs for recovery of a sum of ₹448,75,58,347/- from defendant Nos. 1 to 4 jointly and severally and",,
for permanent and mandatory injunction. The dispute between the parties is investment of the plaintiff No.2 in defendant No.4 of which defendant,,
No.3 is 99% shareholder. The plaintiffs claim that by virtue of Shares Subscription Agreement and the other documents agreed to between the parties,",,
the plaintiff No.2 is the only secured creditor of defendant No.4 and thus has first charge on the property of defendant No.4. Case of the applicants is,,
that as per the Resolution dated 15th January, 2018 defendant No.1 has been absolved of part liabilities post the Resolution, however he continues to",,
be responsible for the litigation including the one in relation to POCSO where the award for a sum of ₹45 crores has been passed against defendant,,
No.4. ₹1 crore has already been deposited from the account of defendant No.4 pursuant to the extension of time granted by the Hon'ble Supreme,,
Court on 11th May, 2020 and if a further sum of ₹4 crores is not deposited, the defendant No.4 would have to incur the liability of a sum of ₹45 crores",,
immediately and thus the requirement of Section 1(a) that the property in dispute in the suit i.e. property of defendant No.4 is in danger of being,,
wasted or alienated is satisfied.,,
51. A perusal of the reliefs sought in the present application as noted in para-2 above clearly shows that even if the suit is finally disposed of the reliefs,,
as sought by the applicants/defendant Nos.1 and 3 cannot be granted to them in the absence of a counter claim. The reliefs sought are not in the,,
nature of seeking restoration of status-quo ante or the position at the time when the suit was filed. The applicants/defendant Nos.1 and 3 have also not,,
made out a strong case so that during the trial they would be in a position to assert the right as sought to be enforced by the present application.,,
Further, the reliefs sought by the applicants/defendant Nos.1 and 3 do not arise out of the plaintiffs†cause of action nor are incidental thereto. At this",,
stage it would also be appropriate to note that the applicants/defendant Nos.1and 3 had filed a prior suit before the Pune Civil Court seeking a decree,,
of specific performance of the agreement against the plaintiffs herein and the reliefs sought in the present application though may be incidental to the,,
prayers in the suit instituted in Pune Civil Court but are in no way incidental to the reliefs sought by the plaintiff in the present suit. Hence this Court,,
finds no ground to grant the reliefs of mandatory injunction as prayed by the applicants/defendant Nos.1 and 3 under Order XXXIX Rule 1(a) CPC.,,
52. Learned counsel for the applicants vehemently states that even if not under Order XXXIX Rule 1(a) CPC this Court to meet the ends of justice,,
and in the exigencies of the situation which is emergent, failing which there will be serious financial loss to defendant No.4, claims exercise of",,
jurisdiction of this Court under Section 151 CPC and in equity.,,
53. Challenging the plea of equity learned counsel for the plaintiffs states that the express terms of contract cannot be ignored on a vague plea of,,
equity and as noted above relies upon the decisions of the Supreme Court in Energy Watchdog (supra) further followed in M/s Halliburton Offshore,,
Services (supra). Learned counsel for the plaintiffs contends that as per the express terms of the contract the plaintiff No.2 is a secured creditor of,,
defendant No.4 and the claim of POSCO at best is of an unsecured creditor thus cannot be over and above the claim of the plaintiffs. As a secured,,
lender the plaintiffs†rights are required to be protected on the borrower's assets and the defendant No.3 which is a 99% shareholder can deposit the,,
sum of ₹4 crores to meet the exigencies arising. Defendant Nos.1 and 3 had filed an application before this Court, advance copy whereof was served",,
on the plaintiffs, wherein the plea was that even if part assets of defendant No.3 were sold they would be worth more than ₹400 crores and thus being",,
the 99% shareholder of the defendant No.4, defendant No.3 can create a charge on any of its properties and deposit ₹4 crores with the Bombay High",,
Court. This is more so because defendant No.1 and 3 claim that they alone are securing the interest of defendant No.4.,,
54. Rebutting the argument of learned counsel for the plaintiffs, learned counsel for the applicants contends that as per the terms of agreement",,
between the plaintiffs and defendant No.4 and the subsequent Resolution of the Board of defendant No.4 dated 15th January, 2018 the defendant",,
Nos.1 and 3 have no liability to pay for the litigation or the liabilities of defendant No.4 which have to be carried out from defendant No.4. Learned,,
counsel for the applicants submits that the plea of the plaintiffs that he is an investor/lender to defendant No.4 is wholly incorrect as defendant No.4 is,,
a joint venture company as is evident from recital “C†of the Share Subscription Agreement dated 26th July, 2014 which reads as under:",,
“Execution Version,,
SHARE- SUBSCRIPTION-AGREEMENT,,
AMONGST,,
GIZA HOLDINGS PTE LTD,,
AND,,
KUMAR URBAN DEVELOPMENT PRIVATE LIMITED,,
AND,,
LALIT KUMAR JAIN,,
AND,,
PRANAY LALITKUMAR JAIN,,
AND,,
SINEW DEVELOPERS PRIVATE LIMITED,,
C. The Company and the Promoters have approached the Investors to invest in the Company so as to enable the Company to utilize the,,
investment made, towards repayment of the existing loans obtained by the Company and towards construction and development of the",,
Project. Accordingly, the Investors and the Promoters intend to make the Company as their joint venture company for the construction and",,
development of the Project;â€,,
55. Claim of the applicants based on the argument as noted above that defendant No.4 is a joint venture company of plaintiff No.2 and defendant No.3,,
is wholly misconceived as the share subscription agreement relied upon has not been entered into with plaintiff No.2. Any agreement of defendant,,
Nos. 1 to 4 with a third party cannot change the status of the plaintiff No.2 from an investor to a partner in a joint venture. Further by virtue of clause,,
16.6 of the DSA dated 5th December, 2014 as reproduced in para 30 above, all the earlier agreement including the share subscription agreement",,
dated 26th July, 2014 relied upon by learned counsel for the applicants stood rescinded.",,
56. Considering the competing rights of secured creditors vis-a-vis unsecured creditors of a company, Supreme Court in the decision reported as 2019",,
(16) SCALE 319 Committee of Creditors of Essar Steel India Limited vs. Satish Kumar Gupta & Ors., held as follows:",,
47. The impugned NCLAT judgment has applied an equality principle down the board stating that whether creditors are secured or",,
unsecured, financial or operational, equitable treatment demands that they all be treated as one group of creditors similarly situate, as a",,
result of which no differences can be made in terms of the amount of debt to be repaid to them based on whether they are secured or,,
unsecured, and whether they are financial or operational creditors. The aforesaid judgment relies upon certain paragraphs of this Court's",,
judgment in Swiss Ribbons (supra) to buttress the aforesaid finding.,,
48. The UNCITRAL Legislative Guide states:,,
Designing the key objectives and structure of an effective and efficient insolvency law,,
xxx xxx xxx,,
4. Ensuring equitable treatment of similarly situated creditors,,
7. The objective of equitable treatment is based on the notion that, in collective proceedings, creditors with similar legal rights should be",,
treated fairly, receiving a distribution on their claim in accordance with their relative ranking and interests. This key objective recognizes",,
that all creditors do not need to be treated identically, but in a manner that reflects the different bargains they have struck with the debtor.",,
This is less relevant as a defining factor where there is no specific debt contract with the debtor, such as in the case of damage claimants",,
(e.g. for environmental damage) and tax authorities. Even though the principle of equitable treatment may be modified by social policy on,,
priorities and give way to the prerogatives pertaining to holders of claims or interests that arise, for example, by operation of law, it retains",,
its significance by ensuring that the priority accorded to the claims of a similar class affects all members of the class in the same manner.,,
The policy of equitable treatment permeates many aspects of an insolvency law, including the application of the stay or suspension,",,
provisions to set aside acts and transactions and recapture value for the insolvency estate, classification of claims, voting procedures in",,
reorganization and distribution mechanisms. An insolvency law should address problems of fraud and favouritism that may arise in cases of,,
financial distress by providing, for example, that acts and transactions detrimental to equitable treatment of creditors can be avoided.",,
xxx xxx xxx,,
5. Approval of a plan,,
xxx xxx xxx,,
(i) Classification of claims,,
27. The primary purpose of classifying claims is to satisfy the requirements to provide fair and equitable treatment to creditors, treating",,
similarly situated claims in the same manner and ensuring that all creditors in a particular class are offered the same menu of terms by the,,
reorganization plan. It is one way to ensure that priority claims are treated in accordance with the priority established under the insolvency,,
law. It may also make it easier to treat the claims of major creditors who can be persuaded to receive different treatment from the general,,
class of unsecured creditors, where that treatment may be necessary to make the plan feasible. Classification can, however, increase the",,
complexity and costs of the insolvency proceedings, depending upon how many different classes are identified. An alternative, to ensure",,
that creditors who should receive special treatment are not oppressed by the majority, may be to give those groups the opportunity to",,
challenge the decision of the majority in court if they have not been treated in a fair and equitable manner.,,
The fact that such a facility exists may operate to discourage majorities from making proposals that would unfairly disadvantage priority,,
creditors.,,
x x x x x,,
58.Quite clearly, secured and unsecured financial creditors are differentiated when it comes to amounts to be paid under a resolution plan,",,
together with what dissentingsecured or unsecured financial creditors are to be paid. And, most importantly, operational creditors are",,
separately viewed from these secured and unsecured financial creditors in S. No. 5 of paragraph 7 of statutory Form H. Thus, it can be",,
seen that the Code and the Regulations, read as a whole, together with the observations of expert bodies and this Court's judgment, all lead",,
to the conclusion that the equality principle cannot be stretched to treating unequals equally, as that will destroy the very objective of the",,
Code-to resolve stressed assets. Equitable treatment is to be accorded to each creditor depending upon the class to which it belongs:,,
secured or unsecured, financial or operational.""",,
57. Thus Plaintiffs being secured creditors of the defendant No.4 have higher claim on the property of defendant No.4 than POSCO which is an,,
unsecured creditor even though it may be armed with a decree as also held by the Division Bench of this Court in the decision reported as 2013 (134),,
DRJ 467 Spice Jet Ltd. & Ors. vs. Malanpur Steel Ltd. & Ors. Therefore, the applicants cannot claim equity to create charge on the property of the",,
defendant No.4 to satisfy the claim of an unsecured creditor even though armed with a decree over and above the charge of the plaintiff No.2 who is,,
a secured creditor.,,
58. To consider the plea of equity raised, it would be appropriate to note that though the claim of the applicants is that in the defendant No.4 the land",,
was brought by the applicants and they also infused a capital of ₹130 crores, however when this Court raised further queries from learned counsel for",,
the applicants the said claim is found to be apparently incorrect, for the reason it was accepted that the land for the project was transferred to",,
defendant No.4 on payment of approximately ₹130 crores taken as a loan and when the agreement was entered into with the plaintiffs, from the sum",,
of ₹190 crores infused by the plaintiffs received as debenture subscriptions, the liability of ₹130 crores which was the value of the project land was",,
discharged. Thus the investment of the applicants in the defendant No.4 project even as per their claim is to the extent of approximately ₹130 crores,,
which fact is also refuted by the plaintiffs according to whom the defendant Nos.1 to 3 hold Series B Non-Convertible Debentures of defendant No.4,,
for an amount of ₹17 crores only and not ₹130 corres as claimed. Thus the investment of the plaintiff No.2 in defendant No.4 being admittedly ₹190,,
crores is far more than that of the applicants.,,
59. It is for the reason that the plaintiffs are the secured creditors of defendant No.4 it has been agreed that any action of defendant No.4 has to be by,,
approval of the plaintiffs and due to this covenant the defendant Nos.1 and 3 seek approval of the plaintiffs to create a charge on the properties i.e.,,
three flats of defendant No.4 to raise a further sum of ₹4 crores besides ₹1 crore already paid from the accounts of defendant No.4. In this regard,,
this Court made queries from learned counsel for the defendants/applicants as to the total flats partly constructed in the project as only one model flat,,
is ready and rest of the construction is incomplete. Learned counsel for the applicants fairly states that in the project four towers were required to be,,
constructed and presently 11 floors in two towers, that is, C-1 and C-2 have only been constructed. Further these 11 floors are also with the basic",,
structure wherein the walls only have been erected and thus major portion of the construction remains to be carried out. On further queries, learned",,
counsel for the applicants also pointed out that out of 55 partly constructed flats in C-1 tower 21 flats have already been sold and in the 65 partly,,
constructed flats in C-2 tower 40 flats have already been sold from which a sum of ₹46 croes have already been received from the respective flat,,
buyers. It is thus evident that out of 120 partly constructed flats in the two towers, that is, C-1 and C-2, 75 flats have been sold and out of the",,
remaining 45 flats still to be sold and the present asset situation of defendant No.4, the applicants are not in a position to satisfy the claim of the",,
plaintiffs who have a first charge thereon. It would be thus inequitable to create a further charge on the property of defendant No.4 to satisfy the,,
claim of an unsecured creditor as against the plaintiffs who are the secured creditors.,,
60. Though applicants claim that everything was with the approval of the plaintiffs however, a perusal of the agreements and particularly the Board",,
Resolution dated 15th January, 2018 indicates that though the defendant No.1 was absolved of the liability of the delay in the project and an",,
independent management brought in however, as regards the POSCO litigation was concerned the same arose when defendant No.1 was looking",,
after the affairs of the defendant No.4. As per the Board Resolution dated 15th January, 2018 it was resolved that he will continue to look after the",,
litigation however, it was clarified that the liability to pay for the cost incurred on litigation was on defendant No.4. The Resolution dated 15th January,",,
2018 does not resolve that the liability to pay any awarded amount or decree would be on the defendant No.4. The liability to pay the cost incurred in,,
litigation is different from liability incurred by way of an award or a decree. It will have to be gone into by the parties as to whether the decree was,,
suffered due to any lack of commitment or action on behalf of the applicants or the plaintiffs. Therefore, even in terms of the Board Resolution dated",,
15th January, 2018 no charge can be created on the assets of defendant No.4 to satisfy the liability arising out of the litigation with POSCO.",,
61. Learned counsel for the applicants has repeatedly relied upon the term sheet to contend that the defendant No.4 was a joint venture of the,,
plaintiffs and the defendant No.3. However, the Debenture Subscription Agreement dated 5th December, 2014 clearly noted in Clause 16.6 that the",,
said agreement along with the transaction documents constitutes a whole agreement between the parties and supersedes any previous oral,,
agreement/understanding, negotiation and discussions between the parties including the Debenture Subscription Agreement dated 26th July, 2014.",,
Further the term of this term sheet had already expired as the same was for 180 days. Hence the plea of the applicants that the plaintiffs not being,,
mere lenders but partners in the joint venture were required to agree to creating a charge on the property of defendant No4 cannot be accepted.,,
62. This Court specifically put to learned counsel for the applicants/defendant Nos.1 and 3 as to why the defendant No.3 has not deposited the sum of,,
₹4 crores from its accounts or by creating a charge on any of its properties subject to the interim injunction passed by this Court whereby 25% was,,
required to be kept in a no lien account with and no further permission was required as defendant No.3 was a 99% shareholder of defendant No.4 and,,
was purportedly acting in the best interest of defendant No.4 by filing the present derivative application. Learned counsel for the applicants in,,
response stated that the liability in respect of the award in favour of POSCO was of defendant No.4, thus defendant No.3 was not required to deposit",,
any amount from its own accounts or by creating a charge on the properties of defendant No.3. In view of this stand of defendant Nos.1 and 3 also,",,
no equity can flow in favour of the applicants.,,
63. Further when this Court raised a query as to why no charge on the assets of defendant No.3 has been created though at one stage an application,,
was filed by defendant No.3 showing its assets value to be substantial, learned counsel for the defendant Nos.1 and 3/applicants stated that liability of",,
POSCO was not of defendant No.3.,,
64. As noted above the defendant Nos.1 to 3 have already filed a suit in Pune seeking specific performance of the agreement between the parties,,
against the plaintiffs herein and when a query was raised to learned counsel for the applicants that the remedy sought in the present application could,,
be addressed in the suit filed at Pune and why no application was filed in the said suit, learned counsel for the applicants states that the present",,
application was maintainable both in this suit as well as the suit at Pune and thus the applicants preferred the application in the present suit. This Court,,
is not in agreement with the reply of learned counsel for the applicants. Though the reliefs claimed in the present application may or may not be,,
incidental to the reliefs sought in the suit instituted at Pune, however they are certainly not incidental to the reliefs sought by the plaintiffs in the present",,
suit.,,
65. At this stage it would be appropriate to note that in the present suit there is no interim orders vis-Ã -vis the property of defendant No.4 as the,,
rights of the plaintiffs in the property of the defendant No.4 are governed by the contract. The interim injunction passed by this Court as modified vide,,
order dated 30th July, 2019 only creates a charge on the properties of defendant Nos.1 to 3 as this Court directed that to balance the equities and in",,
the interest of justice defendant Nos.1 to 3 will deposit 25% of the amount generated from the further development of their ongoing projects in a,,
separate no lien account from the sale of each flat or unit on the ongoing projects or projects proposed to be launched in future either individually or,,
under a joint venture or partnership etc. The Court also clarified that the amount generated from the sale of each flat or unit should be construed to,,
include all the amounts received whether as booking amount, part payment or final payment on or after 31st July, 2019 and the said amounts should",,
not be utilized for any purpose without permission of the Court. Thus to create a charge or to sell the flats from the projects of defendant Nos.1 to 3,,
either individually or as a joint venture or partnership no leave of the Court was required except that the 25% of the amount so generated was required,,
to be kept in a separate no lien account. It is thus evident that the pleas raised by the applicants are selective. They do not wish to encumber their,,
properties.,,
66. At this stage it would also be relevant to note the earlier order of this Court dated 24th February, 2020 when pursuant to the directions of this",,
Court dated 10th January, 2019 directing defendant Nos.1 and 3 to file their list of assets in Form-16A, Appendixâ€"E, Order XXI Rule 41 (2) CPC it",,
was revealed that a sum of ₹9 crores was transferred to Kumar Urban Development Pvt. Ltd., a group company of the defendant Nos.1 and 3",,
besides further amounts transferred individually to the accounts of defendant No.1 and his wife.,,
67. Considering the facts noted above, this Court finds that the reliefs as sought by the applicants/defendant Nos.1 and 3 cannot be granted either",,
under Order XXXIX Rule 1(a) CPC or by way of equity. Consequently, the application is dismissed.",,
68. Copy of this judgment be uploaded on the website.,,
