TMI Blog2022 (6) TMI 994X X X X Extracts X X X X X X X X Extracts X X X X ..... the remedies which may be availed by the petitioner in accordance with law in future. Certainly qua this aspect, the petitioner cannot maintain the present petition being suffered with delay and latches and also the petitioner having acquiesced the subject matter of civil suit, exchange deed and compromise etc. In any case, petitioner is a necessary party in view of proceedings conducted before the National Company Law Tribunal, New Delhi and Scheme of Arrangement approved by the Tribunal in the context of steps to be taken by the parties for the implementation of the Scheme after its approval. The pending application under Section 231 of the Companies Act would be decided by the NCLT in accordance with law. It would be open to the petitioner to seek relief, if any available to it in terms of Section 232(4) to 232(7) of the Companies Act. Since the petitioner claims itself to be an aggrieved party, therefore, it was expected from respondent No.2 to provide adequate opportunity of hearing to the petitioner. Proceedings undertaken before respondent No.2 in the context of preponing the date of hearing from 24.02.2022 to 09.12.2021 unilaterally and thereafter making communication ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No.12/Axis Bank. Mr. Amit Jhanji, Sr. Advocate, with Mr. Sanjeev Sachdeva, Advocate, Mr. Suneet Pal Singh, Advocate and Ms. Eliza Gupta, Advocate for respondents No.13 to 15. **** RAJ MOHAN SINGH, J. CM-4893-CWP-2022 Prayer made in this application is for placing on record the reply filed by the petitioner dated 31.03.2022 to the application for placing on record affidavit dated 28.03.2022 filed by respondents No.5 to 11. For the reasons mentioned in the application, the same is allowed. The reply is taken on record, subject to all just exceptions. CM-4895-CWP-2022 Prayer made in this application is for placing on record Annexure P-25 to Annexure P-29. For the reasons mentioned in the application, the same is allowed. Annexure P-25 to Annexure P-29 are taken on record, subject to all just exceptions. Main case [1]. Petitioner has preferred this writ petition for the issuance of an appropriate writ, order or direction especially in the nature of certiorari for quashing the award dated 09.12.2016 passed by the Daily Lok Adalat in Civil Suit No.160 of 2016/CS No.2536 of 2016 titled Sparash Promoters Pvt. Ltd. And others vs. Cosmo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the demerger order dated 08.01.2018 corrected on 16.07.2018, respondents No.13 to 15 were under legal obligation to act as per instructions of the petitioner. Petitioner being the beneficiary has an exclusive right to use and develop the land parcels and the petitioner has direct and substantial interest in the litigation. Petitioner further claims that writ is maintainable in view of law laid down by the Hon'ble Apex Court in State of Punjab vs. Jalour Singh, (2008) 2 SCC 660 and Bhargavi Construction Anr. vs. Kothakapu Muthyam Reddy Ors., 2017 SCC Online SC 1053. [5]. It has been pleaded that during statutory demerger, the petitioner received usage and development rights in certain land parcels in village Chauma, Tehsil District Gurugram. The said land parcels are situated in Sectors 111 and 113, Gurugram. As per demerger order dated 08.01.2018 corrected on 16.07.2018 passed by the NCLT, petitioner has exclusive right to use and develop these land parcels. Respondents No.7 to 11 fraudulently obtained the consent of the petitioner in passing of impugned award by the Daily Lok Adalat, Gurugram vide order dated 09.12.2016 and have fraudulently managed to get the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssets and interest therein came to be distributed in the manner as indicated in the agreements. The gist of the agreements before initiation of demerger process was that the rights on 1685 acres of land and shareholding of 21 Companies came to the petitioner/MGF Developments Ltd. In the present writ petition, the petitioner has right to develop and use certain land parcels (total measuring 31.03 acres) situated in Sectors 111 and 113, Gurugram i.e. in the revenue estate of village Chauma, Tehsil District Gurugram). [8]. In the present writ petition the petitioner has pleaded that in furtherance of its business interest, the petitioner expressed interest in exchange of the aforesaid land parcels in Sectors 111 and 113 Gurugram with respondents No.7 to 11 i.e. Subsidiaries companies of respondent No.5/M3M Developers Ltd. On 18.11.2016, respondents No.7 to 11 started to claim interest in the aforesaid land even before execution of any formal document. Petitioner got filed a civil suit No.160 of 2016/CS No.2536 of 2016 titled 'Sparash Promoters Pvt. Ltd. and others Vs. Cosmo Propbuild Pvt. Ltd. and others. During pendency of the suit, a compromise was effected between the plai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as per terms of the exchange deeds. [11]. Petitioner further pleads that on 08.01.2018, demerger process was finalized by the National Company Law Tribunal, New Delhi and agreements executed between the joint venture partners in the month of April 2016 were acknowledged and approved in accordance with law. The order dated 08.01.2018 was corrected on 16.07.2018 due to some inadvertent mistakes. The 3rd set of cheques given by respondents No.7 to 11 were dishonoured on presentation with the Banker/respondent No.12 on 27.03.2018. In the month of October 2018, petitioner got into dispute with its erstwhile joint venture partner EMAAR Properties PJSE Dubai along with EMAAR MGF Land Limited on the other part i.e the holding company of respondents No.13 to 15 since June 2019. Respondents No.7 to 11 took undue advantage of dispute and obtained partition of the land parcels at the back of the petitioner and got the revenue entries incorporated in the names of respondents No.13 to 15. All these things happened at the back of the petitioner. Petitioner further claims that factum of partition came to the notice of the petitioner only in the month of July, 2021, when its officials were pursu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n intimation, notice was issued to the petitioner as well. Petitioner was required to produce the relevant record before respondent No.2 on the date fixed. Learned Senior Counsel further submits that respondent No.2, to the utter surprise of the petitioner, changed the date of appearance and preponed the date from 24.02.2022 to 09.12.2021 unilaterally and vide communication dated 08.12.2021, only a day's time was given to the petitioner to appear and submit its case. On 09.12.2021, respondent No.2 was not inclined to give sufficient time to the petitioner to produce its documents and only a week's time was given thereafter and now the case is fixed for 16.12.2021 for disposal. Learned Senior Counsel submits that the petitioner apprehends that the aforesaid indifferent attitude on behalf of respondent No.2 is on account of influence of respondents No.5 to 11. Notice of motion for 20.01.2022. Dasti as well. Till the next date of hearing, respondent No.2 shall adjourn the proceedings arising out of Annexures P17 and P18. [13]. Learned Senior counsel for the petitioner submits that the civil suit was filed by respondents No.13 to 15 only at the instance of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l pursuant to section 232 of the Act, be transferred to and become the liabilities and duties of the Resulting Company; and c) That all proceedings now pending by or against the Demerged Undertaking of Demerged Company be continued by or against the Resulting Company; and d) That Petitioner/Resulting Company shall file within thirty days of the date of the receipt of this order cause a certified copy of this order to be delivered to the Registrar of Companies; and e) That any person interested shall be at liberty to apply to the Tribunal in the above matter for any directions that may be necessary. Sd/ (M.M. KUMAR) PRESIDENT Sd/- (DEEPA KRISHAN) MEMBER (TECHNICAL) [16]. The Scheme of arrangement before the NCLT was approved wherein EMAAR MGF Land Ltd. was the demerged company and MGF Developments Ltd., was the resulting company. The scheme of arrangement provided for the demerged company (as defined hereinafter) from the demerged company to the resulting company and consequent issue of shares by the resulting company to the shareholders of the demerged company, except to the extent shares held by the resulting company in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be quoted hereasunder:- 3.1. Upon the coming into effect of this Scheme and with effect from the Appointed Date, the Demerged Undertaking (including all the estate, assets, rights, title, interest, investments, authorities, liabilities (contingent or not), debts, duties, obligations, including accretions, deductions, subtractions and appurtenances of the Demerged Undertaking) shall be demerged from the Demerged Company and transferred to and vested in and be deemed to have been transferred to and vested in the Resulting Company as a going concern in the mode and manner provided herein pursuant to the provisions contained in Section 391 to 394 and all other applicable provisions, if any, of the Act and without any further act, deed, matter or thing. 3.3. In respect of the assets of the Demerged Company relating to the Demerged Undertaking other than those referred to in Clause 3.2 above, including immovable properties, trade receivables, outstanding loans and advances, advances paid to any parties for acquisition of development rights, recoverable in cash or in kind or for value to be received, bank balances, deposits and balances, if any, with Government Authorities, c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Company, the Resulting Company had been a party or beneficiary or obligee thereto and the Resulting Company shall be bound by the terms and conditions thereof, obligations and duties thereunder. 4.3. For the avoidance of doubt and without prejudice to the generality of the foregoing, it is clarified that upon the coming into effect of this Scheme, all consents, permissions, licenses, certificates, clearances, authorities, power of attorneys given by, issued or executed in favour of the Demerged Company in relation to Demerged Undertaking shall stand transferred to the Resulting Company as if the same were originally by, issued to or executed in favour of the Resulting Company; and the rights and benefits under the same shall be available to the Resulting Company. [19]. Similarly, para no.6 relates to legal proceedings. Paras No.6.1 and 6.2 read as under:- 6.1. Upon the coming into effect of this Scheme all suits, actions, administrative proceedings, tribunals, proceedings, show cause cases, demands and legal proceedings of whatsoever nature by or against the Demerged Company pending and/or arising on or before the Appointed Date or which may be instituted any time t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Demerged Undertaking shall be to the account of the Resulting Company. [21]. Perusal of the aforesaid para would show that the Demerged Company shall carry on and be deemed to have carried on its business and activities in relation to the Demerged Undertaking in the ordinary course of business and shall stand possessed by the Demerged Undertaking in trust for and shall account for the same to the resulting company. Much stress has been made on this paragraph to highlight that whatever was done by respondents No.13 to 15, the same was done in trust for the resulting company i.e. the petitioner. Similarly para No.8.5 is also reproduced hereasunder:- 8.5. All assets (including fixed assets, current assets, cash and bank balances etc.) acquired by the Demerged Company after the Appointed Date and prior to the Effective Date for operation of the Demerged Undertaking or pertaining to the Demerged Undertaking shall be deemed to have been acquired for and on behalf of the Resulting Company. [22]. Para 11 of the Scheme relates to mutual co-operation for giving effect to the Scheme. In nutshell, the petitioner laid emphasis on the Scheme to contend that whatever was d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entertain the same and decide the legality and validity of such compromise. The explanation to Order 23 Rule 3 CPC made it clear that an agreement or compromise which is void or voidable under the Indian Contract Act, 1872 shall not be deemed to be lawful within the meaning of this rule. Since independent suit is barred under Order 23 Rule 3-A CPC, therefore, all the issues are to be decided in the same suit by way of following proper procedure. The statute requires the Court to first satisfy itself that the compromise which has been entered into between the parties is lawful before executing the same. The Court is expected to apply its judicial mind while examining the terms of settlement before suit is disposed of in terms of settlement. The Court shall decide the question where it is alleged by one party or denied by other party that an adjustment or satisfaction has been arrived, the Court shall decide the question. The Court before whom the compromise is effected has to decide the question whether satisfaction has been arrived at on the basis of any lawful settlement. Learned Senior counsel referred to Banwari Lal vs. Smt. Chando Devi (Through LR), 1993 AIR (SC) 1139. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a separate suit or file a writ petition in the High Court. In Bhargavi Constructions and another's case (supra) it was held that the aggrieved party can approach the High Court for challenging the Lok Adalat award. Such aggrieved party would also include 3rd party and the 3rd party would be covered by the meaning of aggrieved person. [27]. In the aforesaid precedents, the scope of 3rd party has been discussed. The aggrieved party has a right to approach the High Court. According to Section 36 of the Indian Contract Act, 1872, contingent agreements to do or not to do anything, if impermissible event happens, are void. [28]. Learned Senior counsel for the petitioner also submits that the petitioner cannot be left remediless. Filing of independent suit in terms of Order 23 Rule 3-A CPC is barred. If petitioner is divested of its rights arising from Scheme of Arrangement framed by the National Company Law Tribunal, New Delhi, the petitioner would be remediless. Where there is a right, there has to be a remedy to redress the grievance. Ubi jus ibi remedium applies to the present set of circumstances. The writ Court is competent to interfere in such circumstances as held by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plan of the colony, plan regarding the development works to be executed in the colony, conformity with the development scheme of the land in question and the neighbouring areas and conformity with the development plan. Title of the land has to be seen in terms of revenue record. Since title of the land in terms of mutation is with respondents No.13 to 15, therefore, respondent No.2 has legal obligation to abide by requirement of Rules to see title of land as shown in the revenue record. In such eventuality, there is no illegality committed by respondent No.2. Petitioner has number of remedies. Firstly, application under Section 231 of the Companies Act and secondly, petitioner can approach the same Court which has passed the compromise decree under Order 23 Rule 3 CPC. Petitioner if, permitted by law can assail exchange deed by way of declaratory civil suit against the incorporation of names in the revenue record. The petitioner can initiate necessary proceedings under Section 45 of the Punjab Land Revenue Act in accordance with law. [31]. Learned Senior counsel for respondents No.5 to 11 further submits that in the pleadings of the writ petition itself, the petitioner ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k vs. Sanjay Raj Subba, (2004) 3 SCC 377 and State of Punjab vs. Gurdev Singh, (1191) 4 SCC 1. [34]. Learned Senior counsel for the petitioner has rejoined the arguments by referring to para 19 of the reply filed by the respondents to the application under Section 231 of the Companies Act. Reply to para 19 of the application submitted by respondents No.13 to 15 reads as under:- 19. Without prejudice to the above, it is submitted that the Scheme envisages transfer of the Demerged Undertaking and its concomitant legal rights under contracts, deeds etc. without any further participation of the Respondent. Where the Scheme envisages formalization of such transfer, if necessary, it suitably empowers the Applicant to act on behalf of the Respondent and effect such formalization. Therefore, these documents are not essential for implementation of the Scheme. [35]. By referring to the aforesaid stand of respondents No.13 to 15, learned Senior counsel for the petitioner submits that the factum of petitioner being resulting company and beneficiary under the Scheme is an admitted fact, therefore, no attorney for filing the civil suit and other proceedings through respondents No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... limb of consideration is the proceedings before respondent No.2. In any case, petitioner is a necessary party in view of proceedings conducted before the National Company Law Tribunal, New Delhi and Scheme of Arrangement approved by the Tribunal in the context of steps to be taken by the parties for the implementation of the Scheme after its approval. The pending application under Section 231 of the Companies Act would be decided by the NCLT in accordance with law. It would be open to the petitioner to seek relief, if any available to it in terms of Section 232(4) to 232(7) of the Companies Act. Since the petitioner claims itself to be an aggrieved party, therefore, it was expected from respondent No.2 to provide adequate opportunity of hearing to the petitioner. Proceedings undertaken before respondent No.2 in the context of preponing the date of hearing from 24.02.2022 to 09.12.2021 unilaterally and thereafter making communication to the petitioner only on 08.12.2021 requiring petitioner to personally appear on 09.12.2021 need to be deprecated. The application for such preponement is not forthcoming except to see that it was done on the application of respondents No.7 to 11. It ..... X X X X Extracts X X X X X X X X Extracts X X X X
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