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2019 (2) TMI 1453 - HC - Companies LawInjunction restraining encashment of Bank Guarantees (BGs) and the objection of the defendants to the subject jurisdiction of this Court to entertain these suits - delayed the receipt of payment under the BBG by nearly over three months. HELD THAT:- As the Civil Court of Original Jurisdiction to be not having jurisdiction to entertain the dispute subject matter of the present suits. Resultantly, the plaints in the suits are liable to be rejected. What emerges on going through all the documents is that the plaintiff, after submitting the resolution plans and after the same were approved by the CoC, has had second thought and/or was not in a position to furnish PBG and started making counter- offer, of conversion of BBG into PBG and opening of an Escrow Account for the balance amount of the PBG and which was not acceptable to the RP/CoC who, after giving sufficient latitude to the plaintiff have invoked the BGs. It cannot also be lost sight of that in the whole process, considerable time, out of the time bound schedule in terms of the Code for the resolution process, has been wasted and wastage of which time may ultimately result in the possibility of Castex and ARGL Limited being restructured ceasing to exist and being inevitably required to be liquidated, all at the cost of the creditors thereof and wastage of the stressed assets of the said two companies. The loss caused by such conduct of the plaintiff is thus mammoth, having adverse consequences on all the creditors and shareholders of the said two companies and also on the economy of the country and to remedy which, the code was enacted. The NCLT is best equipped to also deal with apportionment of the amount of the BBGs in proper account. The present case thus also falls in the category of cases envisaged in SAW Pipes Ltd. [2003 (4) TMI 438 - SUPREME COURT OF INDIA] where loss caused on account of delays in construction of say, a public road, though does not cause loss to any individual or person or company in particular but causes loss to the residents of the country and which is unmeasurable and in which regard a pre-estimate is permitted to be forfeited without proof of any loss. The loss likely to be caused by the conduct of the plaintiff similarly, is to the country as a whole and thus the amount of the BBGs which the plaintiff was required to furnish to ensure that the plaintiff, after furnishing resolution plan does not withdraw, as the plaintiff has done, though not expressly but by conduct, qualifies as a genuine pre-estimate of the loss. On merits also thus, I do not find the plaintiff entitled to a restraint against encashment/payment under the BG. However since this Court has been found to be not having subject jurisdiction to entertain the suits, the plaint in both the suits is rejected. The plaintiff, by instituting the suits has delayed the receipt of payment under the BBG by nearly over three months. The law requires Courts to, while vacating the interim injunction, balance the equities. Though I am refraining from directing the plaintiff to reimburse SBI with interest on the amounts of the BGs but burden the plaintiff in each of the suits with costs of ₹ 25,00,000/- considering the expense incurred by the defendants in contesting the suits including by engaging senior counsels. The plaintiff is directed to pay the said costs to SBI within four weeks of today.
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