TMI Blog2017 (8) TMI 1649X X X X Extracts X X X X X X X X Extracts X X X X ..... ant/Intervener Adv. Sunil Vyas i/b Mansukhlal Hiralal and Co., for Auto Investment Pvt. Ltd., and Velhari Trading Company. Adv. Sunil Varma i/b M/s K. Ashar and Co. for HDFc Bank ltd., Adv. Shekhar i/b M/s The Law point for Liliwati Kirtilal Mehta Medical Trust. Adv. Miss.Mona Malhotra And Adv. Mehraj Mutawalli for investors. SPP Adv. Malankar for the State. ORDER: 1. Applicant, who claims to be an Interim Resolution Professional appointed by the National Company Law Tribunal ('NCLT' for short), is praying that all assets of Roofit Industries Ltd., which are attached by the Competent Authority ('CA' for short) under the provisions of the Maharashtra Protection of Interests of Depositors (In Financial Establishments) Act, 1999 (for short MPID Act), be handed over to him. 2. It is contended that petition under section 252/10 of the Insolvency and Bankruptcy Code 2016 ('I.B.C.' for short) and Rule 7 of the Insolvency and Bankruptcy (Application to Adjudicating Authority), Rules 2016, filed by Roofit Industries Ltd., before the National Company Law Tribunal on 21.05.2017 for initiation of Corporate Insolvency Resolution proce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tors and others were given opportunity to file their say/reply to the present application. 7. Adv. Mona Malhotra, representing some of the deposit holders/investors filed reply at Exh.136/R and opposed the application. These investors contended that applicant cannot intervene and usurp the properties which are secured and in custody of the Competent Authority appointed u/sec.5 of the MPID Act and this Court being the Designated Court under the MPID Act, has exclusive jurisdiction as regards attached properties. They further contended that order passed by the National Company Law Tribunal is not relevant to instant proceeding under the MPID Act as EOW, C.A., State of Maharashtra and Investors were not made party to the insolvency proceedings. They submitted that section 14 of the MPID Act prevails over I.B.C., and intervention as sought is not justified. They further submitted that application is bad in law and made with mala fide intention. They prayed for rejection of application. 8. Economic offences Wing (E.O.W.) Unit VII, Mumbai filed reply at Exh.136/R-1 and opposed the application. EOW submitted that offences punishable under sections 406, 420 and 120-B of the Indian Pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arjat, District -Raigad (at Sr. No. 07 of the Notification dated 6th May 2016), filed reply at Exh.136/R-5. It contended that said property refers to Sunearth Ceramics Ltd and not to Roofit Industries Ltd., to which intervener is concerned. It further contended that said property is mortgaged in favour of HDFC Bank and other consortium lenders and therefore, intervener cannot seek custody or control of said property. 13. Lilavati Kirtilal Mehta Medical Trust, which has filed an objection Exh.1-O u/s.7 of the MPID Act in respect of properties mentioned at Sr. No.31, 32 and 33 of the Notification, filed reply at Exh.136/R-6. It contended that it is the bona fide purchaser/transferee of said properties and the same have been wrongly attached as the properties of Roofit Industries Ltd., and Sunearth Ceramics Ltd., by the C.A. It further contended that these properties were never in the name of Roofit Industries or Sunearth Ceramics and grave irreparable loss, damage, harm and injury will be caused to it, if these properties are handed over to applicant/intervener. 14. Adv. Mehraj Mutawalli representing some of the investors filed reply at Exh.136/R-12 and opposed the application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #39;ble Bombay High Court in the matter of M/s. City Limouzines (India) Ltd. (in liquidation) and Ors., on 09.06.2017. He prayed that application be allowed. 21. Adv. Smt. Mona Malhotra representing some of the investors argued that attached properties are common in both Roofit Industries and Sunearth Ceramics and expressed concern as to what will happen to the investors of Sunearth Ceramics, if application is allowed. Adv. Malhotra further argued that MPID Act is a piece of welfare legislation and it will prevail over the I.B.C., in view of sec.14 of the MPID Act. Adv. Malhotra contended that properties have been attached before the Order passed by N.C.L.T. and therefore, Judgment of Hon'ble Bombay High Court cited by the applicant will not apply. Adv. Malhotra submitted that criminal prosecution against directors of Roofit Industries is pending. She prayed that application be rejected. 22. SPP Shri Malankar for the State argued that in all 25,000 investors have been duped of ₹ 72 Crores. Shri Malankar further argued that offence pertains to year 2003 and competent authority is already appointed by notification published in year 2016. Shri Malankar contended th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... winding up and thus, if the financial establishment as defined under the provisions of the MPID Act is in winding up, then the provisions of the Companies Act, 1956 would apply to such financial establishment. The MPID Act cannot take away the powers under the Companies Act. In my view the provisions of the MPID Act and the Companies Act will have to be construed harmoniously by holding that on winding up of such Companies which are financial establishment as defined under the provisions of the MPID Act, assets of such wound up Companies would vest in the official liquidator and all the creditors including the depositors/investors can lodge their claims before the official liquidator. 118. I am not inclined to accept the submissions of the Learned A.G.P. that the Competent Authority appointed under the MPID Act, has power to deal with the properties of the financial establishment i.e., the Companies in liquidation in these matters under the provisions of said MPID Act and to distribute the sale proceed of the company in liquidation among the investors. 126. ..In my view, the claims of such investors/depositors cannot be considered in isolation and cannot be given priori ..... X X X X Extracts X X X X X X X X Extracts X X X X
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