* HIGH COURT OF DELHI : NEW DELHI
+ IA No.11586/2011 in CS (OS) No.1771/2011
% Judgment decided on: 29.08. 2011
GTL Limited ......Plaintiff
Through: Dr. Abhishek Manu Singhvi , Sr. Adv., Mr. Rajiv Nayar, Sr. Adv., Mr. N.K.Kaul, Sr. Advocate with Mr. Farid Karachiwala, Ms. Fariyal Tahseem, Mr. Rishi Agrawala, Mr. Akshay Ringe & Mr. Nikhil Rohatgi, Advs.
Versus
IFCI Ltd. & Ors. .....Defendants
Through: Mr. Maninder Singh, Sr. Advocate with Mr. Pawanjit S. Bindra, Mr. Vishrov Mukherjee & Mr. Nitin Kaushal, Advs. for D-1 & D-2. Mr. Amit Sethi, Adv. for D-3.
Coram:
HON'BLE MR. JUSTICE MANMOHAN SINGH
1. Whether the Reporters of local papers may
be allowed to see the judgment? Yes
2. To be referred to Reporter or not? Yes
3. Whether the judgment should be reported
in the Digest? Yes MANMOHAN SINGH, J.
1. By this order I propose to decide the interim application being IA o.11586/2011 under Order 39 R 1 and 2 CPC seeking inter alia various reliefs including restraining the defendants No.1 and 2 and their agents and servants in any manner dealing with, disposing of, selling, alienating for sale or creating any third party rights and parting with shares of the suit property by passing the injunction orders.
2. The plaintiff has also filed another application under Order 2 Rule 2 CPC seeking relief to grant leave to the plaintiff to file suit for damages against the defendants.
3. The brief facts of the case are that on 12th July, 2010, Facility Agreement was entered into between defendant No.1 and defendant No.3 whereby defendant No.1 advanced a loan of Rs.250 crores against various securities to the defendant No.3. One of the securities is a pledge of shares of the plaintiff which were to be kept in non-disposal escrow account. The other securities are hypothecation of movable properties, mortgage of immovable properties, corporate guarantees etc given by the defendant No.3. The plaintiff is not a party to this Facility Agreement, even though, plaintiff is group company of defendants No.3 and 4.
4. Defendant No.3 was required to maintain a security cover of two times of the Facility Amount (Rs.250 crores) by escrow of such
number of shares in the Escrow Account in accordance with Non-Disposal and Escrow Agreement in form and manner satisfactory to the defendant No.1. As per the terms of Facility Agreement the said amount was to be repaid by defendant No. 3 at the end of 36 months from the date of disbursement of the loan i.e. from July, 2010.
5. On 12th July, 2010, a Non-Disposal and Escrow Agreement was also executed between the five parties i.e. plaintiff, i.e. GTL Limited, IFCI Financial Services Limited (defendant No.2), AXIS Bank Limited, IFCI Limited (defendant No.1) and Chennai Network Infrastructure Ltd. (defendant No.3). Under the said agreement, the shares of the GTL Infrastructure Ltd./defendant No.4 held by the plaintiff as share holders were placed in an escrow arrangement and the payment account was established for deposit of proceed of such shares in the event of sale and for recovery of outstanding amount in case of default.
6. As per Clause 3.1 of the Non-Disposal and Escrow Agreement (hereinafter referred to as NDE), it is agreed by the parties to the said agreement that the plaintiff shall not deal with the shares during the currency of the said agreement. Clause 4 sets out the escrow arrangement under which the defendant No.2 was appointed as an escrow agent who is the group company of defendant No.1 and in its favour power of attorney was executed by the plaintiff on the same date, inter alia, to pledge, mortgage, charge, transfer, assign and/or otherwise dispose of all or part of Escrowed shares to any person including defendant No.1 as the attorney.
7. As per the NDE, the plaintiff escrowed approximately 17,63,68,219 crores number of shares of defendant No.4. It is specifically provided in the NDE that the escrow would stand converted into a pledge on the occurrence of event of default defined under the Facility Agreement and the NDE.
8. From the aforesaid facts, it is clear that the defendant No.3 had taken a loan facility from the defendant No.1 which was secured by pledging shares of the defendant No.4 held by the plaintiff in an escrow account which was managed by the defendant No.2 who was appointed escrow agent.
Please check the detail Judgment in the attached file……..
