TMI Blog2022 (12) TMI 1377X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Supreme Court under Article 142 of the Constitution of India. This Court under Section 151 of the CPC does not have the powers akin to Article 142 of the Constitution of India. Exercise of powers u/s151 of the CPC is limited to only those circumstances where procedural gaps exists and which is not expressly or impliedly provided for in the CPC, so as to ensure substantive justice is not obliterated by hyper technicalities. This Court whilst exercising jurisdiction under Section 151 cannot be do something contrary to what the statute lays down. The SEBI Circular dated 13th October, 2020 has received the force of law by the said judgment and order dated 30th August, 2022 of the Supreme Court which holds the SEBI Circular to have retroactive effect. It is a conceded position that in accordance with SEBI s Circular dated 13th October, 2020, the requisite majority has not been achieved for approval of the Resolution Plan tabled for approval of at the meeting held on 13th May, 2022. As taken note of the manner in which the Supreme Court has moulded the relief in approving the Resolution Plan which was the subject matter of those proceedings. As noted the observations of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accept the terms of the Resolution Plan and alternatively, the dissenting Debenture Holders be given a right to stand outside the Resolution Plan and pursue other legal means as available in law. 2. The Interim Application No.3928 of 2022 had been moved on 28th September, 2022, when the Applicant had applied for opening of the sealed envelop and disclosing the voting results of the meeting of Debenture Holders convened by Respondent No.2 on 13th May, 2022. The meeting was held pursuant to the orders of this Court dated 31st March, 2022 and 6th April, 2022 in Interim Application (L) No.27570 of 2021. The results of the meeting had been directed to be kept in a sealed envelop pursuant to the order dated 10th May, 2022 read with order dated 12th May, 2022 passed by this Court in Interim Application (L) No.13162 of 2022 (SEBIs intervention Application.) 3. The previous orders which were passed by this Court permitted holding of the meeting and the voting at the meeting was prior to the order of the Supreme Court dated 30th August, 2022. The applicability of the Circular dated 13th October, 2020 issued by the SEBI had still to be determined by the Supreme Court. Thus the voting o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r to 13th October, 2020. 6. The decision of the Division Bench of this Court was challenged before the Supreme Court and by the said order dated 30th August, 2022, the Supreme Court held that the SEBI Circular has retroactive application. 7. Given the said order of the Supreme Court dated 30th August, 2022 which has lays down the law on the applicability of the SEBI Circular, this Court in the present proceedings had by the order dated 28th September, 2022, though allowing opening of the voting results, provided safeguards in that the voting results were not to be publicized and only made available to the Advocates for the parties which by subsequent order dated 10th October, 2022 clarified included parties whom the Advocates represents. This Court had observed that the Supreme Court in the said order dated 30th August, 2022 held that the SEBI Circular has retroactive applicability and voting would have to be as per ISIN wise votings. Thus, the opening of the sealed envelop containing voting results of the meeting held on 13th May, 2022 was in order for the parties and their respective Advocates in these proceedings to assist the Court as to whether the requisite majority as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Resolution Plan of RCFL. In the present case as well as in the case of RCFL which was before the Supreme Court upon their approval according to the terms of the Debenture Trust Deed, the retail Debenture Holders i.e. the individual and HUF Debenture Holders upto Rs.5 lakhs in the present case and upto Rs.10 lakhs in the case of the RCFL would recover 100% of their principal dues from the said companies. The number of Debenture Holders in the present case recovering 100% of their principal dues has been mentioned in paragraph 23 of the Interim Application, viz. 19,353 Debenture Holders in number out of a total of 20,861 Debenture Holders. 12. Mr. Jagtiani has submitted that the Supreme Court in the said order dated 30th August, 2022, was mindful of the recovery which would result i.e. the small time Debenture Holders recovering their 100% dues upon approval of the Resolution Plan. This has been mentioned in paragraph 88 of the said order dated 30th August, 2022. In paragraph 89 of the said Order, the Supreme Court has considered that different voting mechanism proposed under the SEBI Circular will further delay the resolution process and potentially disrupt the efforts underta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt dated 30th August, 2022 as well as the aforementioned observations of the Supreme Court. 16. Mr. Chetan Kapadia, the learned Counsel appearing for the lead bank viz. Bank of Baroda who is Defendant No.3 in the Suit has fairly stated that this Court does not have the powers under Section 151 to mould the relief as has been done by the Supreme Court in exercise of its powers under Article 142 of the Constitution of India by the said order dated 30th August, 2022. He has submitted that since it has been held by the Supreme Court that the SEBI Circular is binding and has retroactive effect, the Debenture Trustees would be bound to follow the SEBI Circular in voting on the approval of the Resolution Plan. 17. Mr. Mustafa Doctor, learned Senior Counsel appearing for the SEBI has taken this Court through the prior orders including order dated 28th September, 2022 by which this Court had allowed the opening of the sealed envelop containing the voting results but in doing so recorded that, this exercise been done for the Advocates for the parties and subsequently clarified to include the parties whom they represent to assist the Court as to whether the requisite majority in accorda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supreme Court in Padam Sen Vs. State of UP, AIR 1961 SC 218. has been referred to and wherein it is provided that the Court is free to exercise inherent powers under Section 151 of the CPC provided the exercise of those powers are not in any way in conflict with what has been expressly provided in the Code or against the intentions of the legislature. 20. Mr. Mustafa Doctor has accordingly submitted that the Applicant by the present Interim Application has sought for exercise of inherent powers by this Court under Section 151 of the CPC which would be in conflict with the settled law, particularly the SEBI Circular dated 13th October, 2020 which has the force of law and has been held to have retroactive application by the Supreme Court in the said order dated 30th August, 2022. 21. Having considered the rival submissions, in my view considering the law laid down by the Supreme Court in SEBI Vs. Rajkumar Nagpal Ors. Judgment and Order in Civil Appeal No.5247 of 2022 dated 30th August, 2022, which holds that the SEBI Circular dated 13th October, 2020 has retroactive application, it is not open for the Applicant by way of this present Interim Application to contend otherwise. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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