TMI Blog2018 (1) TMI 496X X X X Extracts X X X X X X X X Extracts X X X X ..... is invalid on that alleged account. The law is well settled that no notice under Section 176 is even necessary where the pledgor was consulted or acquiesced in the sale. Sale of any pledged share in excess of what was only required to be sold to recover the amount due, would be illegal. It is well settled that the relief sought by parties should not be refused on technical and pedantic grounds. Once the substantive prayers and the cause for justice is borne out in the pleadings, then the Court would be fully within its jurisdiction to mould the reliefs and any technicality would not obstruct the course of justice - the Court can undoubtedly take note of changed circumstances and suitably mould the relief to be granted to the party concerned in order to mete out justice in the case. Suit stands decreed accordingly. - SUIT NO. 2205 OF 1997 - - - Dated:- 5-1-2018 - K.R. SHRIRAM, J. Ms. Sonal a/w. Mr. Vivek M. Sharma for plaintiffs. Mr. J.P. Sen, senior Advocate a/w. Mr. Omkar Chandurkar, Ms. Bhavna Singh and Mr. Paresh Patkar i/b. Mulla and Mulla and CBC for defendant no.1. JUDGMENT : 1. This suit was filed for a declaration that plaintiffs as pledgor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interest at rate of 2% above the interest rate for the Facility, on the overdue interest, principal amount, costs, charges or expenses and/or from the respective due dates for payment and/or repayment. 3. 4. No failure to exercise or delay in exercising any of our rights hereunder or under any other documents will act as a waiver of that or any other right nor shall any single or partial exercise preclude any future exercise of that right. 3. Pursuant to the sanction letter, plaintiffs entered into an Agreement of Pledge dated 12th July, 1995 to secure the said advance of ₹ 5 Crores. Under this Agreement, plaintiffs pledged, in favour of defendant no.1, 2,00,000 shares of defendant no.2, Sesa Goa Ltd. (later name was changed to Sesa Sterlite Ltd.). Plaintiff no.1 also executed in favour of defendant no.1 a demand promissory note dated 12th July 1995 for the said sum of ₹ 5 Crores and a Power of Attorney of the same date, whereby defendant no.1 was authorized to sell the pledged securities, as deemed fit. The clauses (which had few blanks) in the Agreement of Pledge, that are relevant for the present, are set out hereinbelow: 4. In default of payme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or any of them. 11. That this Agreement is to operate as security for the moneys from time to time due to RCL as also for the ultimate balance to become due on the said Loan Account and the said account is not to be considered exhausted by reason of the said Account being brought to credit at any time or from time to time as long as the facility is not terminated. 14. (i) The occurrence of the following shall be treated as default on the part of the Borrower in addition to the defaults enumerated hereinabove earlier. (a) Any principal amount or interest or additional interest or fees, costs, charges or expenses being unpaid for a period more than 15 days from the due date for payment/repayment/reimbursement thereof. (b) (c)Your committing any breach or default in the performance or observance of any term or condition or covenants or provision of this letter and/or of any other security or documents or undertakings executed by you or on your behalf from time to time. (d) . 14. (ii) On the happening of an event of default, RCL shall be entitled, after giving 7 (seven)days written notice to the Borrower(s), to sell or otherwise dispose of the Securi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der cover of a letter dated 19th July, 1995, forwarded as in the case of the first tranche of ₹ 5 Crores, post dated cheques towards monthly interest @ 24% p.a. as well as towards repayment of the principal. 5. Out of the second tranche of ₹ 5 Crores, a sum of ₹ 1.3 Crores was disbursed directly to plaintiff no.1 while a sum of ₹ 3.70 Crores was paid on behalf of plaintiffs to Reliance Share and Stock Broking Ltd . While the post dated cheques for interest were initially honoured from time to time, plaintiffs committed a default in respect of the last installment of ₹ 10,19,178/ payable by way of interest on the second tranche of ₹ 5 Crores as well as the principal sum of ₹ 5 Crores which fell due for payment on 17th January, 1996. By its letter dated 9th February, 1996 , plaintiff no.1 sought an extension of one month s time to repay the said amount. By its reply dated 23rd February, 1996 , defendant no.1 recorded that the cheques for ₹ 5 Crores and ₹ 10,19,178/ would be re deposited on 27th February, 1996. The letter also made an express reference to clause 14 (ii) of the Agreement of pledge and observed: You are req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notification by defendant no.1 as contemplated in clause 4 (b)(1) of Exh.P 1 for entitlement to interest at 36% p.a. It can be only construed as a demand notice as required under section 138 of the Negotiable Instruments Act. I must hasten to add, I am not making any observation as to whether the said letter meets with the requirements of Section 138 of the Negotiable Instruments Act. 9. By a further letter dated 7th May, 1996, plaintiffs referred to the outstanding loan of ₹ 7,50,00,000/ and forwarded post dated cheques of ₹ 1,50,00,000/ each by which they proposed to make payment of the principal amount. Plaintiffs also assured defendant no.1 that the interest amount would be paid before 30th June, 1996 after calculating the same. One of the cheques for ₹ 1.5 crores furnished by this letter dated 7th May, 1996 was subsequently replaced by 3 cheques of ₹ 50 lakhs each. 10 By a letter dated 29th May, 1996 plaintiffs recorded that two cheques of ₹ 50 lakhs each had been honored by them towards principal and interest. They sought extension of time till 4th June, 1996 for repayment of the remaining ₹ 50 lakhs which was to fall due on 30th Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not been obtained. The letter also claimed that the amount payable by plaintiff no.1 had not become due and payable. This does appear to be inconsistent not only with the terms of the agreement between the parties but also with the admitted position that plaintiffs were by that date clearly in default of their payment obligations. 14. It is the case of defendant no.1 that subsequently, plaintiffs agreed to withdraw their objection to the transfer of the pledged securities in the name of defendant no.1 and the enforcement thereafter by defendant no.1 of the pledge to recover the outstanding dues. In that context, by a letter dated 24th September, 1996 addressed to defendant no.2 Sesa Sterlite Ltd., plaintiff no.2 withdrew his objection to the transfer of the shares in the name of defendant no.1. By a subsequent letter of 8th October, 1996 addressed to Bank of India, plaintiffs also issued stop payment instructions in respect of the 4 cheques of ₹ 1.5 crores each earlier lodged by them with defendant no.1. It is clear from plaintiffs conduct that they were perfectly aware at this stage that defendant no.1 intended to sell the pledged securities and were at peace wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that you are free to take decision as to when, how and at what rate to sell the shares which already belong to you. You are also requested to comply with the requisitions made through my letter dated 30th December, 1996. 17. M/s. Kanga Co. acting on behalf of defendant no.1 initially addressed a holding letter to the plaintiffs Advocate recording that they were seeking detailed instructions and would reply shortly. M/s. Kanga Co. appear to have, subsequently, addressed a letter dated 7th February 1997 which has not been produced by both sides and hence is not clear what the contents were. Plaintiff no.1, however, states that a reply was in fact received in paragraph 24 of his witness statement where he asserts Vide the said letter, 1st defendant Company reneged from the oral agreement reached between me and Mr. Sadashiv Rao on behalf of 1st defendant Company with regard to the appropriation of the 1,61,486 pledged shares of 2nd defendant Company by 1st defendant Company at the rate of ₹ 310 per share. 18. Meanwhile, defendant no.1 continued to inform plaintiffs from time to time of the sale of the pledged securities including the rate at which the sales were b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... client further denies the correctness of Statement B . My client submits that our clients have sought to appropriate monies in an arbitrary manner to which my client had never agreed. My client had specifically instructed your clients to appropriate the amounts of sale of shares prior to August 8, 1996 towards the principal amount of loans. Therefore my client denies the correctness of Statement B . 8. With reference to paragraph 8 of your letter, since my client has denied the correctness of the Statement B of your clients, there is no question of any amount outstanding in either loan account 1 and/or loan account 2. In view of the same there is no question of my client paying the said amounts of ₹ 155.71 lakhs or any part thereof to your clients. As far as selling of the shares is concerned since your clients had become the owner of the shares lying with them from August 8, 1996 it will be at their own risk of capital. xxxxxxxx By this letter, plaintiffs called upon defendant no.1 to furnish accounts on the basis set out by them, namely, the appropriation of the pledged securities by defendant no.1 at the rate of ₹ 310/ per share and the payment over t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said shares as alleged in their letter. Thus the 1st defendants did not have any right for sale of the said shares any part thereof. The purported sale of the said shares is wrongful. Plaintiffs are entitled to a declaration to the aforesaid effect. Plaintiffs state that 1st defendants and/or 2nd defendants are liable to disclose to the plaintiffs the names of persons or transferees to whom the shares mentioned in the list (being Exhibit A hereto) have been purportedly sold as plaintiffs intend to join them as necessary parties to the suit. Plaintiffs are entitled to the said shares and are entitled to an order for return of the said shares. Defendant no.1 should be directed to procure the same from the market, if they have sold and transfer the said shares. The plaintiffs are entitled to an order and decree accordingly. The remaining prayers in the plaint relate to this alternative case. 23. Defendant no.1 filed written statement disputing both the main and the alternative plea. Defendant no.1 contended, inter alia, that there was no oral arrangement as alleged and that in any event Mr. Sadashiv Rao was not authorized to enter into any such alleged arrangement and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alternative one, i.e., redemption. In paragraphs 35 and 36 of the affidavit in examination in chief, PW 1 has stated : 35. I further say that I have never received any notice from the 1st defendant Company before it embarked on its purported exercise of selling the 1,61,450 shares of the 2nd defendant Company that formed part of the aggregate 2,00,400 shares that had been totally pledged by me with the 1st defendant Company as security for the aforesaid first loan of ₹ 5 crores. I say that no notice was ever issued by the 1st defendant Company to me before undertaking the sale of the said 1,61,450 shares. I thus say that since the 1st defendant Company has reneged on its agreement of appropriation of the said 1,61,486 shares of the 2nd defendant Company at the rate of ₹ 310/ per share and has further claimed that Mr. Sadashiv Rao had no authority on behalf of the 1st defendant Company to enter into such an agreement, I am ready and willing to repay the balance principal amount of approximately ₹ 2,97,50,000/ which stood outstanding as of 19th June, 1996 or any such other amount which is ordered to be paid by me to the 1st defendant Company by this Honorab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o.1 had the following to say in paragraph 15 of his witness statement: I say that due to the fluctuation in the market price of 2nd defendant Company, I, as per the request of 1st defendant Company in the first week of July, 1996 pledged a further 400 shares of 2nd defendant company with 1st defendant Company vide my letter dated 8th July, 1996. Plaintiffs have not produced any letter by which defendant no.1 called upon plaintiffs to furnish the additional security as alleged. It is the case of plaintiffs that in the first week of July 1996, defendant no.1 had called for additional security and accordingly plaintiff no.1 had handed over 400 shares of defendant no.2 under the cover of its letter dated 8th July, 1996 [Exh.P 25] as additional security. Thus, as on 8th August, 1996 a total of 1,61,486 shares remained pledged with defendant no.1. 30. Mr. Madan Mohan Chaturvedi (DW 1) has, in his affidavit in lieu of examination in chief, explained the circumstances in which the letter dated 8th July, 1996 was addressed by plaintiffs forwarding the 400 shares, distinctive numbers of which are mentioned therein. The relevant portion of paragraph 16 of DW 1's affidavit rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... having extended time for payment by plaintiffs of their outstanding dues; (e) that 98,850 shares of defendant no.2 Sesa Sterlite Limited were sold by defendant no.1 with the consent of plaintiffs while 1,61,450 shares were not; (f) that the sale of the said 1,61,450 shares which were without notice to plaintiffs was illegal and as a result null and void as against plaintiffs; (g) that plaintiffs are consequently entitled to redeem the pledged securities including all accruals thereupon such as bonus issues and dividend upon tendering the amount due from plaintiffs to defendant no.1 on the date of institution of the suit. 33. It is the case of defendant no.1: (a) that while two amounts of ₹ 5 crores each were advanced by defendant no.1 to plaintiffs, they were treated as a single loan for all practical purposes by both parties. It is an admitted position that except for the date on which the two tranches were repayable, the two amounts were advanced on the same terms and conditions as reflected in the sanction letter dated 11th July, 1995. Defendant no.1 has maintained a single ledger account in respect of the composite loan of ₹ 10 crores; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ust, 1996, 13th September, 1996 and 30th December, 1996. In fact, the correspondence addressed on behalf of plaintiffs by their Advocate also proceeds on the basis that an aggregate 3,87,000 shares of Sesa Goa Limited had been pledged against an aggregate loan of ₹ 10 crores. It is in any event an admitted position that the two advances of ₹ 5 crores each are governed by the same terms and conditions as reflected in the sanction letter dated 11th July, 1995. The plea that the two amounts were distinct and that accounts were required to be maintained in respect of each separately is merely a belated afterthought inconsistent with the Plaintiffs' own position in their correspondence. In fact, this contention that accounts were required to be maintained separately in respect of the two advances is not even reflected in the Plaint. In any event, to the extent that the terms and conditions on which the said two amounts were advanced were identical, the maintenance of a single ledger in respect of the whole amount made no difference in practical terms. 35. The distinction sought to be drawn between the pledged securities offered by plaintiffs for the first advance of & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion to any lawful debt actually due and payable to him from the debtor, whether its recovery is or is not barred by the law in force for the time being as to the limitation of suits . The reliance placed by plaintiffs on these Sections is misplaced. Apart from the initial post dated cheques issued for monthly interest and repayment of the principal amount of the two tranches, plaintiffs made no appropriation of the payments made by them. As such, defendant no.1 was entitled to make such appropriation as it chose. Defendant no.1 appropriated the amount towards the earliest liability in point of time. It has tendered in evidence (but never provided earlier to plaintiffs though asked for) a ledger account prepared on that basis. Even if no appropriation had been made, even under Section 60, the payments would stand appropriated towards the earliest dues rather than the dues that may have become payable first. In any event, in the light of plaintiffs' repeated acknowledgments that both loans were in default, the issue is not relevant. 37. Ms. Sonal, counsel for plaintiffs contended that defendant no.1 issued only one notice dated 23rd February, 1996 for sale of the pledged s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the ordinary course of post. (iv) The argument of counsel for defendant no.1 that tender of hard cash is a precondition to filing a suit for redemption and in the absence of such tender, the suit is bad, is incorrect. (v) Plaintiff had filed the present suit after defendant no.1 started selling the balance pledged shares on and from 2nd January, 1997 and informed plaintiff no.1 about the same by its letters starting from 3rd January, 1997 [Exh.P 32] and in paragraph 22 at page 13 of the plaint, plaintiffs have stated that they are ready and willing to pay the entire amount of loan together with interest thereon upon defendant no.1 returning the pledged shares. In prayer clause (c), plaintiffs have prayed that the original Share Certificates of the pledged shares be ordered to be returned to plaintiffs by defendant no.1 against receipt of a sum of ₹ 2,61,43,159/ or such other sum as this Hon ble Court may deem fit and proper. In prayer clause (d), plaintiffs have in the alternative to prayer clause (c) prayed that defendant no.1 be ordered and decreed to make available to plaintiffs 1,61,486 shares by procuring the same from the market against receipt of a su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed time, he may redeem the goods pledged at any subsequent time before the actual sale of them; but he must in that case, pay, in addition, any expenses which have arisen from his default. Section 177 has been explained by this Honorable Court in Official Assignee V/s Madholal Sindhu (supra) wherein it has been held that The actual sale referred to in S. 177 must be a sale in conformity with the provisions of S. 176 which gives the pledgee the right to sell; and if the sale is not in conformity with those provisions, then the equity of redemption in the pledger is not extinguished. Therefore, plaintiffs herein are well within their rights to redeem their pledged shares even as of today by tendering the requisite amounts to defendant no.1 on defendant no.1 reciprocally agreeing to return the equivalent number of 1,61,450 of defendant no.2 along with the due benefits accrued thereon the same as per the provisions of Section 163 of the Act. (viii) The question which will arise for determination by this Court is whether plaintiffs would be required to pay interest only till the date of the filing of the present suit or till the date of tender of the loan amount in ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt. (ix) Without prejudice and in the alternative, it was submitted by plaintiffs that in the context of the facts of the present suit, no tender of any amount is warranted from plaintiffs to defendant no.1 since the shares of defendant no.2 pledged in the present case have benefits accrued on the same which amount to much more than what is due from plaintiffs to defendant no.1, even assuming without admitting that interest has to be paid by plaintiffs to defendant no.1 till the date of actual redemption. (x) Plaintiffs were not obliged to deposit the balance loan amount in Court to enable defendant no.1 to purchase equivalent number of shares and give them to plaintiffs. It was open for defendant no.1 to purchase equivalent number of shares from the market and to deposit the same in Court and seek the balance amount of loan from plaintiffs, which plaintiffs have in any event offered to pay in the suit. Plaintiffs' counsel also relied upon Section 51 of the Contract Act dealing with performance of reciprocal promises and the judgment in Official Assignee vs. Madholal Sindhu (supra) to submit that actual tender of hard cash is not required in a redemption suit when ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1948 Bom 1; Sir Raja Kakarlapudi Venkata Sudarsana Sundara Narasayyamma Garu (died) Ors. v. Andhra Bank Ltd., AIR 1960 AP 273. The only exception is where an honest tender of the amount due is made by the pledgor prior to the institution of the suit and such tender is rejected without cause by the pledgee or where the pledgee has rendered himself incapable by supervening circumstances from returning the pledged goods. The judgments relied upon by Plaintiffs, namely S.L. Ramaswamy Chetty Anr. v. M.S.A.P.L. Palaniappa Chettiar, AIR 1930 Mad 364; Aratibala Mohanty v. State Bank of India, AIR 1991 Ori 260 and State Bank of India v. Mangalabai Deshmukh, AIR 2005 Bom 221 according to Mr. Sen deal with this limited exception, which has no application to the facts of the present case. In the present case, plaintiffs did not make any tender or offer of the outstanding amounts to defendant no.1 prior to the institution of the suit. In fact, plaintiff no.1 admits as much in the course of his cross examination. Even the plaint, apart from the fact that no amounts were deposited by plaintiffs, did not even constitute a real offer to pay insofar as the principal plea on which the action ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Anr. v. Union of India (Supra) that the present suit was an action in detinue as distinct from an action in conversion. However, it is manifest from the Judgment itself that the ingredients for an action in detinue are not met in the present case. The Hon'ble Supreme Court holds: The action of detinue is based upon wrongful detention of the plaintiff s chattel by the defendant, evidenced by a refusal to deliver it upon demand and the redress claimed is not damages for the wrong but the return of the chattel or its value . In the present case, there was no refusal by defendant no.1 to deliver the pledged securities on demand, viz., by a tender of the outstanding amounts. As such, there was no wrongful detention by defendant no.1 of the pledged securities. On the contrary, it was plaintiffs' case prior to and in the suit itself, that the shares belonged to defendants. As such, plaintiffs' purported action in wrongful detention must necessarily fail. 42 In my view, plaintiffs' case is belied by the record. The notice dated 23rd February, 1996 does not confine itself to the 1,87,000 shares pledged by plaintiffs in respect of the second tranche of ₹ 5 cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The law is well settled that no notice under Section 176 is even necessary where the pledgor was consulted or acquiesced in the sale. See Madholal Sindhu of Bombay v. Official Assignee of Bombay, AIR 1950 FC 21 . It is also a settled position that Section 176 only requires notice of the intention to sell and not notice of the particulars of the intended sale. Sankaranarayana iyer Saraswathy Amal v. The Kottayam Bank Ltd., AIR 1950 Travancore Cochin 66, (FB) and Hulas Kunwar v. Allahabad Bank Ltd., AIR 1958 Cal 644, 649. The pledgee is free to choose his own time to exercise the power of sale and is in particular not bound to sell within a reasonable time . See Madholal Sindhu of Bombay v. Official Assignee of Bombay, AIR 1950 FC 21; Sankaranarayana iyer Saraswathy Amal v. The Kottayam Bank Ltd., AIR 1950 Travancore Cochin 66. In the present case, defendant no.1 has not only made manifest its intention to sell the pledged securities but has promptly communicated to plaintiffs the particulars of each sale. Even otherwise, apart from the fact that defendant no.1 had in fact given notice of its intention to enforce the pledge, plaintiffs were perfectly well aware of defen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) 701. Neither of the judgments are of assistance to plaintiffs' case. The Judgment in Hulas Kunwar (Supra) involved a premature enforcement of the pledge by the sale of the pledged securities prior to expiry of an extension of time granted by the pledgee. That is not the case here. Pigot v Kubley (Supra ) was a case where the parties were found to have substituted a new agreement under which the time for payment, and consequently the power of sale, was indefinitely extended. No such agreement is pleaded in the present case. The disputed sales occurred at a time when plaintiffs were admittedly in default and had consciously not objected to the transfer of the pledged shares in the name of defendant no.1, being fully aware that defendant intended to deal with them. The facts support no case of waiver by defendant no.1 of any notice or of any right to enforce the pledge. 48. In view of this conclusion, I do not see any need to go into other elaborate arguments made by the opposing counsel. 49. It was also argued on behalf of defendant no.1 that while the main relief in the suit is for a declaration that both the loans stood repaid on or about 8th August, 1996 on the ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that any notification to change the rate of interest during the continuance of the facility had to be made in writing by defendant no.1. 53. Defendant no.1 claims to be entitled to levy interest at the rate of 36% on the basis of its letter dated 21st March, 1996 [Exh.P 19], which is a notice issued by it under the provisions of Section 138 of the Negotiable Instruments Act, after default in repayment of the first loan. DW 1 during his cross examination gave evasive replies in answer to questions on increase of rate of interest from 24% p.a. to 36% p.a. I would add, from the answers, DW 1 has not denied that no other notice to increase the rate of interest to 36% was sent by defendant no.1 before or after Exh.P 19. 54. The notice dated 21st March, 1996 [Exh.P 19] is not a notice under clause 14(b)(1) of the sanction letter and therefore, the levy of interest at 36% by defendant no.1 is unjustified and wrongful. 55. Under clause 4(b)(2) of the sanction letter [Exh.P 1], defendant no.1 was entitled to levy additional interest @ 2% in the following words: 4(b)(2) In case of default either in the payment of interest, additional interest, the repayment of the principal am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... March 1997. As the Court was unable to find the correct figures, the matter was placed for directions on 30th October 2017 and the counsels were requested to provide a statement arrived at by consensus as to what would be the amount payable on the basis of interest calculated at 24% per annum simple interest, how many pledged shares were sold beyond the number that was required to be sold to recover that amount less 36 shares returned by defendant no.1 to plaintiff no.1 pursuant to order dated 22nd July 1997, what would be the number after excess share sold were split and bonus shares issued by defendant no.2 company (accretions) and the dividend that would have been paid on those shares (unpaid dividend) after 4th March 1997. The matter was placed again for directions on 9th November 2017, 16th November 2017 and on 23rd November 2017. The counsels were unable to arrive at a consensus. Finally different statements were given by both the parties. I would proceed on the basis of statement given by defendant no.1 and also proceed on the basis of calculations of defendant no.1. Defendant no.1 gave the working of shares and accretions as under : Statement of accounts of the sim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iate to itself the sale proceeds. Defendant no.1 was not even providing plaintiffs with detailed break up of the calculations despite repeatedly being called upon to produce. As could be seen from the evidence, plaintiffs were repeatedly asking defendant no.1 to provide the break up. If only defendant no.1 had been honest in its calculations and provided timely statements, this situation would not have arisen. It is true that it was plaintiff no.1 who had approached defendant no.1 for financial assistance and plaintiff no.1 had defaulted in its payment but at the same time, defendant no.1 could not arrogate itself to the position that without any basis, and because they had possession of the pledged shares, and the value of the shares were much more than the amount repayable by plaintiffs, go on selling the shares when there was no need. 62. The effect of this is defendant no.1 had wrongfully detained the shares after the entire amount calculated at 24% p.a. interest had been recovered. The extra shares that defendant no.1 sold by calculating at 36% p.a. interest or its value had to be returned. 63. It is well settled that the relief sought by parties should not be refused on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osition that for making the right or remedy claimed by the party just and meaningful as also legally and factually in accord with the current realities, the court can, and in many cases must, take cautious cognisance of events and developments subsequent to the institution of the proceeding provided the rules of fairness to both sides are scrupulously obeyed .. 64. In the circumstances, I am inclined to reject the submissions of Mr. Sen and hold that plaintiffs are entitled to the shares with accretions and unearned dividend but the entitlement will be based on the statement of defendant no.1 and defendants' calculations. 65. In my view, therefore, plaintiffs shall be entitled to a decree as under against defendant no.1 : (a) Deliver within four weeks 11,49,680 fully paid equity shares, in view of sub division and bonus issue of shares of defendant no.2 company, which defendant no.1 may purchase from the market and deliver to plaintiffs; (b) In the alternative to clause (a), and in any event after four weeks, pay the amount equivalent to value of 11,49,680 fully paid equity shares as on the date of this decree or payment/realisation, whichever is higher. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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