Allowed

Western India Shipyard Limited Now through Resoultion Professional Mr.O.P. Kanoongo v. M v Qing and Others

Bombay HC15 Nov 2022IA/4491/2022

Case brief

AI extract

What is this about?

Single Judge allowed an interim application permitting an applicant to transfer its right, title, and liens pledged in a Commercial Admiralty Suit to an auction purchaser (ABKJ & Co.).

What did the court decide?

Permission to transfer right, title, liens, and claims in the suit to ABKJ & Co. granted; respondent to be impleaded as plaintiff.

Western India Shipyard Limited Now through Resoultion… — Company and Corporate | Bombay HC (2022)

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12-IA-4491-22+.DOC

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Sayali Upasani

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY ADMIRALTY AND VICE ADMIRALTY JURISDICTION

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INTERIM APPLICATION NO.4491 OF 2022

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COMM. ADMIRALTY SUIT NO.63 OF 2016

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Western India Shipyard Ltd ... Applicant/Org. Plaintiff In the matter between Western India Shipyard Ltd ...Plaintiff Vs.

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M.V. Qing & Ors ...Respondents

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Mr. Prathamesh Kamat i/b Yashvi Panchal, for Applicant.

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Mr. Vikrant Shetty i/b Dhruve Liladhar & Co., for Respondents.

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Mr. Prateek Pansare with Mr. Siddharth Manek i/b Crawford Bayley & Co., for Defendant No. 3.

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Mr. Jetendra B. Mishra with Mr. Ashutosh Mishra, for Applicant in NMS/2374/2019.

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Mr. A.M. Vernekar, for Defendant No. 4

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CORAM: N. J. JAMADAR, J. DATED : 15^th NOVEMBER, 2022

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PC:-

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The plaintiff-applicant has taken out this application seeking permission of the Court to transfer its entire right, title, liens, claims (including maritime claims and maritime

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liens) in the instant Commercial Admiralty Suit in favour of ABKJ & Co.- respondent-auction purchaser, with permission

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to the respondent to further prosecute the remedies.

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12-IA-4491-22+.DOC

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By an order dated 26^th July, 2018, the plaintiff company was directed to be liquidated under the Insolvency and Bankruptcy Code, 2016 (“IBC”). Eventually, in July, 2022, the liquidator issued a tender for sale of two “not readily realizable assets” (within the meaning of regulation 37-A of the Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016) of the plaintiff company, being Lot 1 and Lot 2, therein.

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Lot 1 was described as under-

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“Entire right, title, liens and interest of the Corporate Debtor in Commercial Admiralty Suit No. 63 of 2016 pending before the Hon’ble Bombay High Court and all applications therein, including all right, title and interest in all receivables, claims liens (including possessory lines, maritime liens and maritime claims), any reimbursements (including of reimbursement of Sheriff’s expense and refund of court fees) as well as any other actionable claim or receivable that the Liquidator/Corporate Debtor would otherwise have against Sahara Tourism Development Corporation Ltd, Trinty Leisure Company Pvt Ltd., M/s Balaji Fuels the Vessel M.V. Qing and the sale proceeds from the Vessel M.V. Qing lying with the Hon’ble Bombay High Court...”

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The auction was held on 18^th August, 2022. The respondent was declared the highest bidder in respect of Lot 1 for a sum of Rs.60,00,000/-. Respondent paid the balance amount of Rs.54,00,000/-, after adjusting EMD of Rs.6,00,000/-, on 9^th September, 2022. Hence, this application.

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None appeared for defendant No.2, Sahara India Tourism Development Corporation Ltd.

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12-IA-4491-22+.DOC

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The learned Counsel for defendant No. 3, Trinity Leisure Company Pvt Ltd submitted that defendant No. 3 submits to the orders of the Court.

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Mr. A.M. Vernekar, the learned Counsel for the Board of Trustees of the Mormugao Port Trust, the defendant No. 4, submitted that in fact the application ought to have been made by the respondent in the capacity of assignee.

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The learned Counsel for respondent, on his part, submitted that the respondent is willing to be impleaded in the capacity of the plaintiff in accordance with the schedule of amendment (Exhibit B) appended to the application.

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Mr. Kamat, the learned Counsel for the applicant-plaintiff would urge that though the transfer of ownership of the subject matter of the instant suit has occasioned by operation of law yet, by way of abundant caution, the plaintiff-applicant is seeking leave of the Court to transfer its maritime claim and liens in favour of the respondent.

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Attention of the Court was invited to the observations in paragraph No. 49 of the Judgment of Division Bench in the case of The Swedish Club Vs. V8 Pool Inc. and other, Commercial Appeal No. 108 of 2021 in Interim Application No.

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12-IA-4491-22+.DOC

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2062 of 2021, dated 23^rd March, 2022. They read as under-

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“insofar as the last bone of contention, i.e. whether pre-arrest wages paid by Swedish Club can be given the status of a maritime lien, is concerned, it appears to us that the law is that such lien is not assignable/ subrogable without prior leave of the court. However, there does not seem any blanket embargo on the transferability of such lien. If the prior leave of the court has been taken, the lien can be transferred. As stated above, Swedish Club cannot be faulted for approaching the Admiralty Court to take leave before making such payments. In any event, Mr. Kamat has fairly conceded that such lien as the crew members had may be considered to be transferred to Swedish Club.”

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The Division Bench has held that there does not seem any blanket embargo on the transferability of the maritime lien. In the case at hand, the transfer of the assets is, in a sense, by operation of law.

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In the circumstances, I do not find any impediment in

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granting the permission to transfer the assets. Moreover, the respondent - transferee is willing to be impleaded in the capacity of the plaintiff and prosecute further remedies.

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Hence, application stands allowed in terms of prayer Clause “a” and “b”

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Necessary amendment in accordance with the schedule of amendment (Exhibit B) appended to the application be carried out within a period of two weeks.

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Application disposed.

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[N. J. JAMADAR, J.]

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Western India Shipyard Limited Now through Resoultion Professional Mr.O.P. Kanoongo v. M v Qing and Others

Case brief

What is this about?

What did the court decide?

Western India Shipyard Limited Now through Resoultion Professional Mr.O.P. Kanoongo v. M v Qing and Others

Case brief

What is this about?

What did the court decide?

What the court decided

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