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OLR/13620/2006 17/ 17 JUDGMENT
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
OFFICIAL
LIQUDATOR REPORT No. 136 of 2006
In
COMPANY
PETITION No. 100 of 1997
With
COMPANY
APPLICATION No. 170 of 2008
In
OFFICIAL
LIQUDATOR REPORT No. 136 of 2006
For
Approval and Signature:
HONOURABLE
MR.JUSTICE K.A.PUJ
=========================================================
1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
2
To
be referred to the Reporter or not ?
3
Whether
their Lordships wish to see the fair copy of the judgment ?
4
Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ?
5
Whether
it is to be circulated to the civil judge ?
=========================================================
O.L.
OF M/S. GUJARAT B.D. LUGGAGE LTD. - Applicant(s)
Versus
ICICI
BANK LTD. & 5 - Respondent(s)
=========================================================
Appearance
:
OFFICIAL
LIQUIDATOR for
Applicant(s) : 1,MS AMEE YAJNIK for Applicant(s) : 1,
SINGHI &
CO for Respondent(s) : 1,
MR BHARAT JANI for Respondent(s) :
2,
NOTICE SERVED for Respondent(s) : 3,
MR INDRAVADAN PARMAR
for Respondent(s) : 4,
MR BHARAT T RAO for Respondent(s) : 5,
MRS
KRISHNA G RAWAL for Respondent(s) :
6,
=========================================================
CORAM
:
HONOURABLE
MR.JUSTICE K.A.PUJ
Date
: 10/11/2008
ORAL JUDGMENT
The Official Liquidator
has filed OLR No.136 of 2006 making several prayers therein, more
particularly placing on record two valuation reports, one dated
22.4.1999 submitted by Shri Mukesh M. Shah and another one dated
21.12.2005 submitted by Shri Vinod R. Trivedi, and also informing
the Court about large instances of theft which has not been reported
to the Official Liquidator by the Security Agency, namely, M/s.
Modern Safe Guard Pvt. Ltd. The Official Liquidator has further
prayed for change in the security agency and entrusting the security
work to M/s.Noble Detective & Security Services Pvt. Ltd., and
fixing their remuneration.
This Court has issued
notice on 17.11.2006 and directed the responsible officer from
respondent Nos.5 and 6 to remain personally present before the Court
on the next date of hearing i.e. 1.12.2006. Since the notices could
not be served on the respondent Nos.5 and 6, nobody remained present
before the Court. However, at the relevant time the respondent No.5
was incharge of the security work and hence bailable warrant was
issued on Shri Jaydeep Singh Director of M/s. Modern Safe Guard
Pvt. Ltd. On behalf of the respondent No.5 Mr. B.T.Rao, learned
advocate filed his appearance and direction was issued to respondent
No.5 to remain personally present. On 6.3.2007 time was sought for
on behalf of the respondent No.5 to file detailed affidavit-in-reply
after inspection of the record like inventory etc. from the office
of the Official Liquidator, despite the fact that detailed affidavit
was filed on behalf of the respondent No.5 on 23.2.2007. This Court
has observed in its order dated 24.4.2007 that as per the valuation
report dated 22.4.1998 submitted by the Valuer Shri Mukesh M. Shah,
plants, machineries and other movables at the relevant time were
worth Rs.1,72,75,000/- and then security agency was appointed.
Inspite of that when subsequent valuation was carried out by Shri
Vinod R. Trivedi on 21.12.2005, it was found that plants,
machineries and other movables were worth Rs.1,05,000/- only. The
Court, therefore, directed the Official Liquidator to file detailed
criminal complaint with the concerned Police Station immediately for
theft etc, on or before 30.4.2007 and the concerned Police Authority
/ Police Inspector of the concerned Police Station was directed to
investigate the said FIR immediately.
Pursuant to the order
dated 24.4.2007 the Official Liquidator issued a letter dated
30.4.2007 to the Police Inspector, Kalol, Dist. Panchmahal under
whose jurisdiction the Company situated and also deputed an Official
from his office to Kalol Police Station, Dist. Panchmahal to file
detailed criminal complaint for theft etc. The complaint has been
registered as FIR No.85 of 2007 on 1.5.2007 and the said FIR was
placed on record of this Court alongwith Official Liquidator’s
Report dated 2.5.2007.
On behalf of the
respondent No.5 additional affidavit was filed on 9.7.2007
reiterating that the respondent No.5 is not responsible for the
alleged theft committed at the factory premises. The Court,
thereafter, vide its order dated 26.9.2007 directed the Official
Liquidator to file report based on the communications received by
the Official Liquidator from the concerned Police Station in
connection with the complaint of theft. The Official Liquidator was
also directed to file report as to whether the very security agency
was looking after any property of the Company in liquidation or not
and if yes, the details thereof. Pursuant to this order the
Official Liquidator has filed his report dated 14.12.2007. In his
report he has stated that the security services of M/s. Modern Safe
Guard Pvt. Ltd., have been taken away from the factory premises of
the Company as well as of other companies in liquidation where the
concerns of Shri T.V. Singh were assigned the work of safeguarding
assets of the Company. It was further stated in the said report
that before change of the security arrangement, the valuation of the
assets of the Company was obtained and large discrepancy was found
between two valuation reports. Since Mr. B.T.Rao, learned advocate
appearing for the respondent No.5 has stated before the Court on
that day that he could not contact his client and his presence was
required, the Court has issued non-bailable warrant on Shri T.V.
Singh, the authorised person of respondent No.5.
Before the Non-bailable
warrant could be served on the respondent No.5, an application being
Company Application No.170 of 2008 is filed on behalf of the
respondent No.5, praying for cancellation of Non-bailable warrant
and undertaking to this Court that the respondent No.5 would remain
present as and when any direction is issued by this Court. Since
Shri T. V. Singh against whom Non-bailable warrant was issued was
present before the Court on 5.3.2008, non-bailable warrant issued
by this Court on 19.2.2008 was kept in abeyance. On 14.3.2008, this
Court has observed in its order on the basis of submission made by
Mr. B.T.Rao that the charge-sheet has been filed and hence the copy
of the charge-sheet is required to be placed on record. The Court,
therefore, directed the Official Liquidator to verify from his
record and to produce the same on the record of this application.
Pursuant to to the order dated 14.3.2008 the Official Liquidator has
filed his report on 18.3.2008 stating that the copy of charge-sheet
was not made available to the Official Liquidator he, therefore,
wrote letter to the concerned Police Station on 18.3.2008 and
assured the Court that as and when the charge-sheet is received the
same will be placed on the record. It appears that the charge-sheet
has not come on record till this date.
In the above background
of the matter, detailed submissions were made by the learned
advocates appearing on behalf of the respective parties. Ms. Amee
Yajnik, learned advocate appearing for the Official Liquidator, Mr.
Bharat Jani, learned advocate appearing for IFCI and Mr. Indravadan
Parmar, learned advocate appearing for IDBI, have strongly submitted
that theft on large scale has been committed during the tenure of
the respondent No.5 and hence the respondent No.5 cannot be absolved
from its responsibility. Irrespective of the Criminal complaint that
has been filed against the respondent No.5 the loss caused to the
Company of the assets that have been stolen away should be made good
by the respondent No.5 and the Official Liquidator should be
directed to initiate proceeding for recovery of the amount. Not
only this, no payment should be made to the respondent No.5 against
its outstanding dues, if any.
Mr. B.T.Rao, learned
advocate appearing for the respondent No.5 on the other hand, has
strongly urged that the Official Liquidator has not placed true and
correct facts before this Court and he has tried to mislead the
Court by making wild allegations against the respondent No.5 without
verifying true and correct facts. He has further submitted that
M/s. Gujarat B.D. Luggage Ltd. was before the BIFR under SICA Act,
1985 and the BIFR did not agree as the agreement submitted by the
Director was not viable and BIFR forwarded its opinion for winding
up of the Company. Thereupon the registry of this Court has received
registered Company Petition No.100 of 1997 and matter has been
placed before the Court. This Court issued notice on 28.7.1997 and
the Official Liquidator was appointed as Provisional Liquidator by
order dated 28.7.1997. On 1.9.1997 the Official Liquidator wrote
the respondent No.5 to work as security agency on usual prevailing
rate for payment of security agency for the protection of the assets
of the Company. He has further submitted that the Official
Liquidator sealed the factory premises and only small gate was kept
open for moving in and out of the security agency. No inventory had
been taken in the presence of the security agency at any point of
time nor it was given to the respondent No.5. He has further
submitted that the valuer appointed by the Official Liquidator had
visited the factory premises on 24.4.1998. There also the signature
of any guard deployed there had not been taken. He has further
submitted that after 1998 regular inspection took place and
representatives of the secured creditors were visiting the premises
and they took round of the premises on their own. He has further
submitted that the respondent No.5 was not getting regular payment
inspite of various requests made to the Official Liquidator. It
was made clear to the Official Liquidator that if the payments were
not made in time, the respondent No.5 would not be responsible to
guard the properties of the Company. He has further submitted that
the Sale Committee was constituted and property was put to sell,
however no offer was received. He has further submitted that
another valuation report was taken. However, the same was not as
per the practice and procedure adopted by the valuer. If one would
compare both the valuation reports, it would be very clear that in
1998 value of the land was Rs.95 lacs and in 2005 the same has been
reduced to Rs.14 lacs. In no circumstances, the valuation of the
immovable property can be decreased. He has further submitted that
the valuer has not looked into the plant, furniture, fixture and
vague valuation has been made. He has further submitted that in the
subsequent report of 2005 the valuer has not mentioned anything
about details of the machineries and only three lots have been shown
while earlier report give different items in lotwise for every
particular item. He has, therefore, submitted that in absence of
any documentary evidence such as list of machineries which was there
in the first inventory in 1997 and detailed inventory made in the
first valuation report of 1998, supplied to the respondent No.5, no
liability can be fastened on the respondent No.5. He has further
submitted that it was not the case of the Official Liquidator that
the lock applied by it has been broken and in absence of that the
valuation report is required to be rejected. He has further
submitted that since the property was scattered in the large area
and during the midnight if something had happened, it was not within
the knowledge of the respondent No.5 and that the respondent No.5
was not aware as to which type of machineries were there in the
premises. Considering all these submissions, he has submitted that
the respondent No.5 is not at all responsible for any theft that has
been taken place in the factory premises of the Company in
liquidation.
Having heard the learned
advocates appearing for the respective parties and having gone
through the report filed by the Official Liquidator as well as the
affidavit-in-reply filed on behalf of the respondent No.5 and having
considered the two valuation reports as well as other documents on
record, the Court is of the view that the work of protecting and
safeguarding the assets of the Company has been assigned to the
respondent No.5 way back in 1997 and from that date onwards the
respondent No.5 was incharge of the said work. The first valuation
report was obtained on 22.4.1998 and the second valuation report was
obtained on 21.12.2005. Till then the respondent No.5 was incharge
of safeguarding the assets of the Company in liquidation. It is,
therefore, clear that the movable assets were stolen or removed
during the tenure of the respondent No.5.
Sr.No.
Description of
property
Amount
as per valuation report submitted by Shri Mukesh M. Shah, Valuer
(Rs.)
Amount
as per valuation report submitted by Shri Vinod R. Trivedi,
Valuer (Rs.)
1
Land
53,95,000
14,88,500
2
Building
Structure
1,59,00,000
3,86,18,915
3
Plant
& machineries & other movables
1,72,75,000
1,05,000
4
stocks
50,00,000
Nil
TOTAL
4,35,70,000
4,02,05,000
From the above statement
it is clearly revealed that so far plant and machineries and other
movables as well as stocks are concerned, there was substantial
reduction and value of Rs.1,72,75,000/- has gone down to
Rs.1,05,000/- only and stock value was shown at Rs. Nil as against
Rs.50 lacs shown in the valuation report dated 22.4.2008. The
explanation given by the respondent No.5 is not at all tenable and
it gives an impression that the respondent No.5 wanted to serk from
its responsibility. It is relevant to note that Shri T.V.Singh was
originally running a concern, namely, M/s. Industrial Personnel and
Security Services and work of securing and safeguarding the assets
of the Company, namely, The Ahmedabad Manufacturing & Calico
Printing Mills Co. Ltd., was assigned to him. This Court vide order
dated 17.8.2005 passed in OLR No.112 of 2003 has directed the
Official Liquidator to recover an amount of Rs.6,19,04,660/- from
M/s. Industrial Personnel and Security Services a concern of Shri
T.V.Singh as stated in the minutes of the meeting of Sale Committee
held on 10.8.2006. It is, therefore, clear that Shri Singh is in
the habit of indulging in such practice of removing the assets of
the company in liquidation, whenever any work is assigned he has
done the same thing. This Court has, therefore, no hesitation in
holding that the respondent No.5 with which Mr.Singh is closely
associated is responsible for the theft committed and the Official
Liquidator has rightly changed the security agency and stopped the
payment of its outstanding dues, if any. Mere stopping of payment
would not serve any purpose as the loss caused to the Company in
liquidation is much more and the huge recovery is required to be
made against the respondent No.5 as well as the other concern with
which Mr. T.V.Singh is associated. The Official Liquidator is,
therefore, directed to look into the matter and vigorously pursue
for recovery of the amount. The Official Liquidator is further
directed to ascertain the status of the criminal complaint that has
been filed and file a fresh report before this Court placing the
charge-sheet on record and any development that has been taken place
in the criminal complaint pending before the Criminal Court at
Kalol. The action of the Official Liquidator in entrusting the work
of security to the respondent No.6 is hereby ratified. The Official
Liquidator is further directed to undertake the procedure for sale
of the assets of the company in liquidation after fixing the
detailed schedule in consultation with the secured creditors. After
ascertaining the status of criminal case the Official Liquidator
shall file a fresh report before this Court.
Subject to the aforesaid
directions and observations this OLR as well as Company Application
both are disposed off.
(K.
A. PUJ, J.)
kks
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