Krantikari Suraksha Rakshak Sanghatana VS. Bharat Sanchar Nigam Ltd. & Ors.

Extract

---

Krantikari Suraksha Rakshak Sanghatana VS. Bharat Sanchar Nigam Ltd. & Ors.

The Judgement Information System REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. _3628__ OF 2008 (Arising out of SLP (C) No. 12616 of 2007)

M/s. Bakemans Industries Pvt. Ltd.

Versus M/s. New Cawnpore Flour Mills and others WITH

CIVIL APPEAL NO. 3629_ OF 2008 (Arising out of SLP (C) No. 14427 of 2007)

M/s. Bakemans Industries Pvt. Ltd.

Versus M/s. New Cawnpore Flour Mills and others JUDGMENT

S.B. SINHA, J.

1. Leave granted in both the matters.

2. Whether power of a Company Court to sell the property of a company vis-a-vis the power of the Financial Corporation can be merged

2 is the question involved in these appeals which arise out of the judgments and orders dated 2nd July, 2007 and 6th July, 2007 passed in Company Appeal No. 27 of 2004 and Company Appeal No.2 of 2007 respectively passed by the Division Benches of the Delhi High Court.

3. Certain basic facts are not in dispute which are as under : SICOM Ltd. (SICOM in short) advanced a loan of Rs.17 crores to the appellant (M/s. Bakemans Industries Pvt. Ltd.). It became a defaulter. SICOM issued a notice under Section 29 of the State Financial Corporations Act (1951 Act in short) on 22nd January, 2003. Another notice was issued for taking over possession of the properties of the sister concern of the appellant, viz. Captain Hygiene Products Ltd.

Appellant and its sister concern filed two writ petitions in the Punjab and Haryana High Court at Chandigarh. They were dismissed as withdrawn on 10th February, 2003.

4. 1st respondent and fourteen others filed fifteen applications before the Delhi High Court for winding up of the appellant-company. Notices were issued thereupon. SICOM issued a second notice under Section 29 of the 1951 Act on 6th June, 2003.

3 5. Indisputably the factory of the appellant was an ongoing concern.

SICOM took over the possession of the appellant's factory at Patiala on 18th July, 2003. It was at that time in operation. It had finished bakery products which were perishable in nature. Allegedly the operations were shut down and the factory was locked.

6. We may notice here that different proceedings were initiated either at the instance of the appellant or at the instance of some of the respondents.

7 evidently took recourse to a proceeding which was unknown to law. A purported agreement was entered into by and between the appellant and one NRI Lead Bank. We are not aware as to what were the disputes about between them. The said purported disputes were referred to Arbitral Justice Tribunal of ADR Arbitration, a body said to have been recognized by the Government of India in terms of Section 21 of the Arbitration and Conciliation Act, 1996. A purported reference of disputes in terms of a purported arbitration agreement contained in a composite instrument dated 14th August, 2003 was referred on 16th August, 2003. It was accepted by the Tribunal on 18th August,

4 2003 and notices were issued. The majority of the Tribunal opined that there was no genuine arbitration agreement. The arbitration proceeding was closed on 23rd August, 2003.

8. A new set of Arbitrators was constituted by the Tribunal who rendered an award on 16th August, 2003 upon holding a day's sitting only opining that (i) taking over of the unit was illegal and (ii) a direction was issued to handover possession to Bakemans.

9. A purported execution petition was filed by NRI Lead Bank before the Delhi...

See the full content of this document

---