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TMI Blog2019 (8) TMI 273X X X X Extracts X X X X X X X X Extracts X X X X ..... over the property at A2/2-25, Site B, Surajpur Industrial Area, Greater Noida, U.P. mortgaged by EPPL with it, subject to the Appellant agreeing to meet the liabilities of the workmen under Section 529A of the Companies Act, 1956 and also the costs of security provided at the property by the Official Liquidator (OL) attached to this Court. 2. The facts in brief are that the Appellant advanced credit facilities to EPPL for which two properties of EPPL - one of which was the aforementioned property - were mortgaged with the Appellant. As a result of EPPL defaulting in making payments to the Appellant, recovery proceedings were initiated by the Appellant against EPPL before the Debt Recovery Tribunal (II) ('DRT') Delhi under the Recovery of D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counsel for the Appellant, is that the Appellant should not be required to bear the liability towards the workmen's dues and the cost of the security provided at the site by the OL to protect the property in question, since in any event the Appellant as a secured creditor stood outside the winding up proceedings. As far as the workman's dues are concerned, learned counsel for the Appellant referred to Section 31B of the IDBI Act which according to him gives priority to the secured creditors. 6. On the other hand, Ms. Ruchi Sindhwani, learned counsel for the OL, has pointed out that the Appellant has been totally lackadaisical in making any attempt to protect the property mortgaged with it. She repeatedly insisted that this Court should re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... since there was no security, the OL deployed two security guards for 8 hour shifts aggregating 6 security guards per day of M/s. P. S. Security Services. She submitted that if the Appellant was keen that the possession of the property should be restored to it, it ought to have taken immediate action by moving the learned Company Judge. 9. It is sought to be submitted on behalf of the Appellant by Mr. Kumar that the citation regarding appointment of the OL for EPPL was not published and, therefore, the Appellant was not required to acknowledge the OL having taken possession of the property in question. This submission requires to be rejected. Once the Appellant was at the property in question and saw the locks placed on it by the OL, it cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whichever is less, shall rank pari passu with the workmen' s dues for the purposes of section 529A. (2) All persons who in any such case would be entitled to prove for and receive dividends out of the assets of the company, may come in under the winding up, and make such claims against the company as they respectively are entitled to make by virtue of this section, Provided that if a secured creditor instead of relinquishing his security and proving for his debt proceeds to realise his security, he shall be liable to pay his portion of the expenses incurred by the liquidator (including a provisional liquidator, if any) for the preservation of the security before its realization by the secured creditor. Explanation: For the purpos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Single Judge only to the extent of the Appellant having to reimburse the costs incurred by the OL in providing security, it is directed that the Appellant will be handed over possession of the property in question by the OL subject to the Appellant (1) paying the workman's dues including EPF. (2) paying the costs of the security provided by the OL at the site from 12th October 2017 till the date of handing over of the possession. (3) Either continuing the security arrangements made by the OL or immediately substituting it with the agency engaged by the Appellant so that there is no gap in providing security at the property. 15. It will be open to the Appellant now to sit with the OL to work out the precise date on which it is prepar ..... X X X X Extracts X X X X X X X X Extracts X X X X
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