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CA/11993/2008 9/ 9 ORDER
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
CIVIL
APPLICATION - FOR ORDERS No. 11993 of 2008
In
SPECIAL
CIVIL APPLICATION No. 20353 of 2005
=========================================================
ATUL
LIMITED & 1 - Petitioner(s)
Versus
STATE
OF GUJARAT & 1 - Respondent(s)
=========================================================
Appearance :
NANAVATI
ASSOCIATES for Petitioner(s) : 1 - 2.
MS
SANGEETA VISHEN AGP for Respondent(s) : 1 -
2,
=========================================================
CORAM
:
HONOURABLE
MR.JUSTICE ANANT S. DAVE
Date
: 17/11/2008
ORAL
ORDER
Heard
learned counsel for the parties Mr.K.S.Nanavati, learned Senior
Advocate with Mr.Paritosh Calla for the applicants and Ms.Sangeeta
Vishen, learned AGP for the respondents.
Rule.
Ms.Sangeeta Vishen, learned AGP waives service of notice of rule for
respondents.
This
application is filed by the original applicants for modification of
the orders dated 29.12.2005 and 3.2.2006 passed in Special Civil
Application No.23591 of 2005 with Special Civil Application No.20353
of 2005.
In
the above Special Civil Applications challenge was against
unilateral cancellation of agreement dated 11.3.2002 by the
respondents and also to quash and set aside the resolution dated
30.10.2001 so far as it fixes rates for drawal of water from river
Par by the applicant-petitioner company. At the relevant point of
time after hearing learned counsel for the parties, Hon’ble Mr.
Justice M.R.Shah passed an interim order dated 29.12.2005, which
reads as under:-
Date
: 29/12/2005
ORAL
ORDER
Rule.
2. To
be heard with Special Civil Application No.20353 of 2005.
3. Heard
the learned advocates appearing on behalf of the parties in both the
petitions with regard to interim relief.
4. By
way of interim relief the recovery of water charges for the period
between 25.9.2000 to 13.1.2003 at the rate as per the notification
dated 30.1.2001 is stayed. So far as recovery of water charges for
the period subsequent to 14.9.2003 at the rate as per notification
dated 30.1.2001 is concerned, Shri K.S.Nanavati, learned senior
advocate appearing on behalf of the petitioner has submitted that
without prejudice to their rights and contentions the petitioner
would be depositing amount of Rs.1.00 crore (Rupees One Crore only )
with the respondents within a period of one month from today and
further amount of Rs.1.00 crore would be paid within a period of six
months thereafter.
5. Considering
the facts and circumstances of the case and considering the financial
liabilities and the past dues and considering the above statement,
recovery sought for from the petitioner for the period subsequent to
14.1.2003 is stayed on condition that the petitioner shall deposit an
amount of Rs.1.00 crore (Rupees One Crore only ) within a period of
one month from today and further sum of Rs.1.00 crore be deposited
within a period of five months thereafter on further condition that
the petitioner company shall file an undertaking that the petitioner
will make the aforesaid amount of Rs.2.00 crores within a stipulated
time as stated above and till the petition is finally heard, decided
and disposed of, the petitioner company will not transfer, alienate
and / or create any charge over the properties of the company.
6. So
far as the period subsequent to September, 2005, for which, Special
Civil Application No.23591 of 2005 is filed is concerned, i.e. for
future levy, it is directed that without prejudice to their rights
and contentions of both the parties, the petitioner shall pay
consumption charges as well as the fixed charges as per the invoice
except the amount of penalty and interest and for the penalty and
interest, the petitioner shall furnish security. The aforesaid
arrangement is made till the next date of hearing i.e. 10.1.2006..
S.O.
to 10.1.2006.
Sd/-
[
M.R.Shah, J.]
Later
on, applicants have filed Civil Application No.102 of 2006 in
Special Civil Application No.23591 of 2005 seeking permission of
this Court for creating charge on the properties of the applicants
and vide order dated 03.02.2006 Hon’ble Mr. Justice M.R.Shah passed
the following order :-
Date
: 03/02/2006
ORAL
ORDER
Rule. Ms.
Sangita Vishen, learned AGP waives service of rule on behalf of the
respondents.
Heard Shri
K.S.Nanavati, learned senior advocate appearing on behalf of the
petitioners as well as Shri K.B.Trivedi, learned Additional Advocate
General appearing on behalf of the respondents.
This is an
application submitted by the applicants-original petitioners to
modify the order dated 29.12.2005 passed in Special Civil
Application No.20353 of 2005 and modify the condition of giving
undertaking not to create any charge over the properties of the
company.
Shri
K.S.Nanavati, learned senior advocate appearing on behalf of the
applicants-original petitioners has submitted that the
applicants-original petitioners have already deposited Rs.1 Crore
and further sum of Rs.1 Crore is to be deposited within a period of
5 months as ordered vide order dated 29.12.2005. He has also further
submitted that the applicants’ company is already having assets
worth Rs.800 Crores upon which there is a charge of Rs.294 Crores
and the applicants are required to create charge/s on the said
property in the ordinary course of business. He has also further
submitted that so far as not to transfer and/or alienate is
concerned, the applicants have no difficulty but so far as
directions for not creating any charge over the properties of the
company is concerned, for the reasons stated above, the same is
required to be modified and therefore, it is requested to modify the
said order to that extent. It is also further submitted by him that
appropriate condition/s may be imposed directing the applicants to
inform this Court by way of affidavit and also informing the
concerned department on creating further charge/s so that if
ultimately the concerned department is to say something against the
same and the same can be pointed out.
Shri Trivedi,
learned Additional Advocate General has fairly conceded that if the
interest of the department is protected and the applicants inform
the department with regard to creating further charge/s in future
and also file affidavit before this Court before creating the
charge/s, then the order may be modified as prayed for.
Considering
the above, the order dated 29.12.2005 passed in Special Civil
Application No.20353 of 2005 is modified to the extent that the
applicants shall file an undertaking as directed by this Court vide
its order dated 29.12.2005 to the effect that till the petition is
finally heard, decided and disposed of, the company will not
transfer and/or alienate the properties of the company and that they
are permitted to create charge/s over the properties of the company
in ordinary course of business on condition that as and when further
charge/s is/are created, the petitioners shall file an affidavit
before this Court informing the Court as well as the concerned
department. Such an undertaking with the Board Resolution be filed
within a period of 2 weeks from today. Shri Nanavati, learned senior
advocate does not press the prayer in terms of paragraph-7(C) at
present.
Rule is made
absolute to the aforesaid extent, however, there will be no order as
to costs.
Sd/-
(M.R.SHAH, J.)
Pursuant
to that the company had filed an undertaking that the petitioner
company shall not transfer or alienate the properties of the company
and accordingly after the above order came to be passed the company
is paying water charges every month with effect from 25.9.2005.
According
to the applicant-petitioner company, outstanding dues of Rs.44.60
crores is disputed and principal amount of Rs.20 crores is towards
water charges and Rs.24.6 crores is towards interest and penalty.
Learned counsel for the petitioners submits that during the pendency
of the petitions, the petitioner company wants to sale the
properties; (1) a residential property at 188, Jorbag, New Delhi and
(2) open land of 300 acres situated in Valsad district, to meet with
various business requirements.
Learned
counsel for the applicants further submits that the financial
details of the company including the market value of the property as
per the Government Registered Valuer is as under:-
(a) The Company had fixed
assets of Rs.232 crores as on March 31, 2005. The market value of
such assets was Rs.800 crores.
(b) The value of the fixed
assets in the books has gone up to Rs.371 crores as on March 31, 2008
as compared to the figure of Rs.232 crores as on March 31, 2005, an
increase by Rs.139 crores. The market value of these assets is
Rs.1274.94 crores. The copy of the Valuation Report given by the
government Registered Valuer is annexed hereto and marked as
Annexure-V. Brief details of the market value of the fixed assets
are summarized as under :-
Sr.No.
Fixed Asset
Market value
Rs.Crores
1
Land at Valsad
436.48
2
Residential Property at Jorbagh, New Delhi
44.50
3
Commercial property at Dadar Mumbai
51.50
4
Residential flats at Mumbai
4.30
5
Commercial property at Ahmedabad
1.00
6
Commercial property at Ahmedabad
0.79
7
Industrial plot at Ankleshwar
24.00
8
Colony land at Ankleshwar
2.75
9
Industrial plot at Ankleshwar
33.86
10
Factory land at Tarapur
1.76
11
Buildings
184.00
12
Plant and Machinery
490.00
Total
1274.90
Learned
counsel for the applicants submits that additional affidavit is also
placed on record showing the details of the properties on which the
respondent may create its exclusive first charge as per the
directions of this Court. The above affidavit is filed by the
Manager Secretarial & Legal and according to the affidavit
properties shown in para 4 of the additional affidavit (the details
of which are as under) are available for creating charge. The above
charge will be as such sufficient against the outstanding dues of
Rs.58.00 crores approximately towards outstanding dues to the
Government.
i)
Commercial Property @310-B Veer Savarkar Rs.51.50 crores
Marg,
Nr.Prabhadevi Telephone Exchange,
Dadar
(West), Mumbai (Ground+5 floors)
ii)Commercial
property at 101, First Floor Rs. 1.00 crores
A-Wing,
Heritage, 7, Alkapuri Society
Nr.Gujarat
Vidyapith, Ahmedabad.
Considering
the above aspects, it is submitted by learned counsel for the
applicants to release them from undertaking which filed by them and
permit them to sell the properties narrated in para 2 of the
application and prayer made terms of para 22(a) may be granted.
Ms.Sangeeta
Vishen, learned AGP, however submits that creating of charge of the
two commercial properties situated in Mumbai and Ahmedabad and
considering their market value, the same is not sufficient to met
with the outstanding dues of Rs.58.00 crores approximately and some
additional securities is to be furnished by the applicants and
suitable directions can be given accordingly.
Having
heard learned counsel for the parties and considering the overall
facts and circumstances of the case and the dues outstanding to the
Government of Rs.58.00 crores, out of which principal amount due to
the Government is Rs.19.85 crores and penalty is Rs.8.59 crores and
interest is about Rs.29.56 crores, creation of first charge on the
commercial properties situated at Mumbai and Ahmedabad as narrated
in para 4 of the additional affidavit dated 15.10.2008 will meet
with at least 90% of the total outstanding dues and will be more
than double than the principal amount. Besides, applicant herein
continued to pay the current and regular charges for consumption of
water and there is no breach of any of the terms and conditions of
the undertaking. The requirement of the applicants for selling the
properties as stated in para 2 is not doubted by the respondents.
Besides, fixed assets as shown in para 16 in a tabular form by the
applicants also indicate some other properties including plant and
machinery worth Rs.900 crores. The above properties are also part
of the undertaking filed by the applicants on earlier occasion that
without permission/leave granted by this Court, the properties are
not to be disposed of.
Considering
the above aspects of the matter, since the interest of the
respondents is adequately protected, after creating first charge in
favour of the respondents over the properties viz. (i) Commercial
Property @310-B, Veer Savarkar Marg, Near Prabhadevi Telehpone
Exchange, Dadar (West), Mumbai (Ground + 5 floors) : Rs.51.50 crores
and (ii) Commercial Property at 101, First Floor, A-Wing, Heritage,
7, Alkapuri Society, Nr.Gujarat Vidyapith, Ahmedabad : Rs.1.00
Crore, I am inclined to grant applicants-petitioners company to sale
the properties of the applicants viz. (1) a residential property at
188, Jorbag, New Delhi and (2) open land of 300 acres situated in
Valsad district. Accordingly, this Civil Application is allowed.
Rule
is made absolute to the aforesaid extent only.
(ANANT S. DAVE, J.)
*pvv
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