Disposed

I. C. I. C. I. Bank Ltd. v. the Official Liquidator H. C. Bombay as Liquidator of Pal Peugeot Ltd.

Bombay HC3 Apr 2014NMS/905/2011

Case brief

AI extract

What is this about?

In a notice of motion, the High Court directed the Court Receiver to reimburse ICICI Bank Limited for verified security and other expenses from the suit account. The court rejected the need for duplicate verification by the Official Liquidator and fixed reimbursement interest at 9% p.a., denying further amounts due to lack of evidence.

What did the court decide?

Court Receiver directed to release Rs.1,44,81,701 and Rs.32,595 with 9% p.a. interest; Rs.84,405 denied due to inadequate evidence.

I. C. I. C. I. Bank Ltd. Vs the Official Liquidator H… — Company and Corporate | Bombay HC (2014)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY. ORDINARY ORIGINAL CIVIL JURISDICTION

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NOTICE OF MOTION NO. 905 OF 2011 IN SUIT NO. 3636 OF 1999

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ICICI Bank Limited … Plaintiffs Versus The Official Liquidator … Defendants And The Court Receiver, High Court, Bombay … Respondent

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Mr. Virag Tulzapurkar, Sr. Advocate along with Mr. Vijendra Purohit i/by M/s. Manilal Kher Ambalal for the plaintiffs.

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Mr. J.P. Sen, Sr. Advocate for the Official Liquidator.

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CORAM : R.D.DHANUKA J. DATED : APRIL 03, 2014.

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P.C.

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By this notice of motion plaintiffs seek an order and direction against the Court Receiver to pay to the plaintiffs from the suit account sum of Rs.2,16,17,400/- as on 31^st December, 2010 towards security expenses incurred by the plaintiffs and further expenses till 8^th March, 2011 with interest thereon in its capacity as a Debenture Trustee and further seeks an amount of Rs.81,42,020/- as on 31^st December, 2010 and further expenses till 8^th March, 2011 with interest thereon towards other expenses incurred by the plaintiffs towards valuation charges, advertisement expenses for sale and other expenses.

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By an order passed by this Court on 20^th November, 2012, this court had appointed M/s. Jitendra Sanghavi and Co., Chartered Accountants

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for the purpose of checking and verifying the bank vouchers and invoices submitted by the plaintiffs towards various heads and to submit a report. Plaintiffs had claimed reimbursement of the expenses incurred by the plaintiffs on security services to secure and safeguard the property in question. Pursuant to the said order passed by this court, M/s. Jitendra Sanghavi & Co. has submitted a report on 31^st October, 2013 which indicates that the Chartered Accountant have verified the copies of the invoices raised by M/s. Sentinel Security Services on plaintiffs, copies of the bank statements of the plaintiffs in clearance of the payment made to M/s. Sentinel Security Services Ltd., further documentary evidence and bank clearance certificate and after verifying the same has come to the conclusion that adequate evidence are available for security expenses and other expenses incurred by the plaintiff amounting to Rs.1,44,81,701/- and Rs.32,595/- respectively. It is further opined that in so far as other expenses amounting to Rs.84,405/- is concerned, plaintiffs have not produced adequate evidence.

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The report submitted by the Chartered Accountants are taken on record and are accepted. At this stage, Mr. Sen, learned senior counsel for the Official Liquidator submits that though the Chartered Accountant appears to have verified the invoices and other documentary evidence produced by the plaintiffs, have certified the reimbursement, it would be more appropriate if these invoices are verified by the Official Liquidator also. Perusal of the order passed by this court dated 20^th November, 2012 while appointing the Chartered Accountant, does not indicate any such liberty granted to the official liquidator. The Chartered Accountants appointed by this court have submitted a report after verifying the requisite documents. In my view, the documents are not required to be scrutinized once again by the Office of the

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Official Liquidator. The request of the learned senior counsel is accordingly rejected.

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The Court Receiver, High Court, Bombay is accordingly directed to release sum of Rs.1,44,81,701/- and Rs.32,595/- respectively towards the security expenses and other expenses incurred by the plaintiffs from the suit account within two weeks from today. It is made clear that since the plaintiffs have failed to produce adequate evidence in respect of Rs.84,405/-, the said amount need not be released. It is made clear that the amount as directed to be released by this order will be in addition to the amounts already released pursuant to ad interim order passed by this court in this notice of motion.

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Mr. Tulzapurkar learned senior counsel for the plaintiffs further submits that the plaintiffs are also entitled to reimbursement of the expenses in the sum of Rs.1,17,580/- which were incurred by the plaintiffs in respect of the suit premises and plaintiffs have made these payments to the office of the Court Receiver. Mr. Sen, learned senior counsel for the Official Liquidator invited my attention to paragraph 11 of the Court Receiver's report dated 28^th March, 2011 which states that the plaintiffs have produced copy of the certificate dated 22^nd March, 2011 addressed by Sentinel Security Services informing that it had received the said amount on 23^rd January, 2006 and 29^th June, 2006. The original certificate however is not produced before the Court Receiver. Mr. Tulzapurkar, learned senior counsel submits that this payment is not overlapping with the security expenses which are certified by the Chartered Accountant appointed by this court. The Court Receiver is directed to verify the original certificate if produced by the plaintiffs in so far as this amount is concerned and to certify whether these

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expenses were incurred by the plaintiffs for securing the suit property. If the office of the Court Receiver is satisfied with the aforesaid aspect, the said amount also be released to the plaintiffs within two weeks from the date of such certification.

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Mr. Tulzapurkar, learned senior counsel then submits that in addition to the reimbursement of the amounts incurred by the plaintiffs to preserve the property which was for the purpose of all the creditors, plaintiffs are also entitled to claim interest on the amount spent by the plaintiffs in respect of all such claims in respect of which reimbursement is sought by the plaintiffs. Plaintiffs have claimed interest at the rate of 15% p.a. from the date of making the payment. Mr. Sen, learned senior counsel for the Official Liquidator invited my attention to paragraph 12 of the report submitted by the Court Receiver on 28^th March, 2011 which states that the interest is not paid by the Court Receiver in many cases such as valuer's charges, security charges, advertisement charges, court receiver charges, whenever office of the Court Receiver requested the person at whose instance the Court Receiver is appointed to make those payments. Learned senior counsel further submits that the claim of interest is not the decretal amount which could be reimbursed by the Court Receiver.

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Perusal of the order passed by Mr. Justice R.M. Sawant indicates that the issue of interest is kept open. In support of the claim for interest at the rate of 15% demanded by the plaintiffs, plaintiffs have relied upon the debenture trust deed and submits that in case of any such expenses incurred by the plaintiffs, the company who was party to the agreement was liable to repay the amount with interest at the maximum lending rate and thus claim for interest at the rate of 15% p.a. is reasonable.

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In my view, since the expenses incurred by the plaintiffs are recognized by this court and are required to be reimbursed to the plaintiffs, it would be appropriate if the reasonable rate of interest is approved to the plaintiffs on the amount required to be reimbursed. The Court receiver is directed to release interest at the rate of 9% p.a. on the amounts released to the plaintiffs towards the reimbursement of various expenses pursuant to ad interim order passed and the order passed today from the date of payment till the date of release of the aforesaid amounts. Notice of motion is disposed of in the aforesaid terms. There shall be no order as to costs.

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( R.D.DHANUKA, J.)

I. C. I. C. I. Bank Ltd. v. the Official Liquidator H. C. Bombay as Liquidator of Pal Peugeot Ltd.

Case brief

What is this about?

What did the court decide?

I. C. I. C. I. Bank Ltd. v. the Official Liquidator H. C. Bombay as Liquidator of Pal Peugeot Ltd.

Case brief

What is this about?

What did the court decide?

What the court decided

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