Disposed

Asset reconstruction Company India Ltd. v. Daewoo Motors India Ltd. (through Ol)

DRT20 Apr 2023APPEAL/7/2023

Case brief

AI extract

What is this about?

In Appeal No.7 of 2023, the Debt Recovery Tribunal set aside the Sale Proclamation and certain notices due to the Recovery Officer's non-adherence to e-auction regulations. The Tribunal restored the appellant's receivership, discharged the Private Receiver, and approved the 4th respondent's revised offer subject to a balancing order by the Recovery Officer.

What did the court decide?

The Sale Proclamation and certain notices were set aside; the appellant's receivership was restored; the private receiver was discharged; and the Recovery Officer was directed to comply with direction

classifi-
cation

No.
of
Exh.

Appeal No.7 of 2023
ARCIL
Vs.
M/s. Daewoo Motors India Ltd. & Ors.

Mr Tushad Cooper, Sr. Counsel, Mr Bhalchandra Palav, Mr
Aniket Dighe and Ms Drishti Doshi i/b M/s. Bhal & Co. –
Advocates for the appellant.

Mr Akbar Rizvi i/b M/s. AKS Legal – Advocates for
respondent no.2.
Ms Rupa Patel – respondent no.3 in person.
Mr Nitin Thakker, Sr. Counsel, Mr Prakash Choudhary and
Ms Ragina David i/b Mr Prerak Choudhary – Advocates for
respondent no.4.
Ms Barsha Parulekar – Advocate for Official Liquidator.

Mr Rajesh Nagori i/b M/s. J. Sagar & Associates –
Advocate for bidder (IHDP Globals Private Limited)

1. Mr Cooper, learned senior counsel representing the

appellant, presented draft minutes of the order
(exhibit-10), which is taken on record.

2. By the minutes, the appellant and respondents
consented for the orders and declarations recorded
therein.
3. By consent, the order dated 13^thMarch 2023, 15^th
March 2023 and impugned notices dated 17^thMarch
2023 (exhibits A to D to the Appeal) are set aside.
4. The 3^rdrespondent, that is, Ms Rupa Patel (Private
Receiver) stands discharged forthwith.

5.	The appellant’s receivership is restored and Mr
	Ashish Shahi, appellant’s Chief Manager, is re-
	appointed as receiver based on the order dated 22^nd
	November 2012.
6.	The parties raised their concerns before the Tribunal
	over the mode and manner in which the Recovery
	Officer has proceeded to hold the auction sale
	scheduled on 18^th April 2023 concerning the
	immovable property of the 1^strespondent (in
	liquidation). On 10^thApril 2023, the Tribunal stayed
	the auction proceedings before the Recovery Officer.
	The appellant and respondents raised concern for the
	reserve price of Rs.310 crores against the 4^th
	respondent’s offer of Rs.350 crores.
7.	It is also observed that the Recovery Officer has not
	strictly adhered to the notification regulating the e-
	auctions. Consequently, the Sale Proclamation dated
	8^thMarch 2023 is hereby set aside.
8.	During the pendency of the present Appeal, the 4^th
	respondent revised its offer of Rs.350 Crores, to be
	paid within 90 days (with grace period of 45 days with
	12% interest p.a. for the extension period) instead of
	180 days as earlier proposed by the 4^threspondent.
	The 4^threspondent’s offer has been principally
	approved by the appellant and the 2^ndrespondent as
	per minutes of the Joint Lenders Meeting held
	between appellant and the 2^ndrespondent as the first
	charge holders and secured creditors of the 1^st
	respondent (in liquidation) qua the Immovable
	Property) inter alia approving the revised terms
	offered by the 4^threspondent.

The appellant’s receivership is restored and Mr

Ashish Shahi, appellant’s Chief Manager, is re-

appointed as receiver based on the order dated 22^nd

November 2012.

The parties raised their concerns before the Tribunal

over the mode and manner in which the Recovery

Officer has proceeded to hold the auction sale

scheduled
on
18^th
April
2023
concerning
the

immovable property of the 1^strespondent (in

liquidation). On 10^thApril 2023, the Tribunal stayed

the auction proceedings before the Recovery Officer.

The appellant and respondents raised concern for the

reserve price of Rs.310 crores against the 4^th

respondent’s offer of Rs.350 crores.

It is also observed that the Recovery Officer has not

strictly adhered to the notification regulating the e-

auctions. Consequently, the Sale Proclamation dated

8^thMarch 2023 is hereby set aside.

During the pendency of the present Appeal, the 4^th

respondent revised its offer of Rs.350 Crores, to be

paid within 90 days (with grace period of 45 days with

12% interest p.a. for the extension period) instead of

180 days as earlier proposed by the 4^threspondent.

The 4^threspondent’s offer has been principally

approved by the appellant and the 2^ndrespondent as

per minutes of the Joint Lenders Meeting held

between appellant and the 2^ndrespondent as the first

charge holders and secured creditors of the 1^st

respondent (in
liquidation)
qua
the Immovable

Property) inter alia approving the revised terms

offered by the 4^threspondent.

9. Mr	Nagori, representing the bidder, would su	bmit
that	his client has already made a bid and has off	ered
Rs.3	10 crores for the subject property in quest	ion.
The	4^threspondent’s counsel would submit that	the
learn	ed Recovery Officer was incompetent to ac	cept
any	such bid in view of the stay order passed by	this
Trib	unal on 5^thApril 2023 and 10^thApril 2023.
10. The	learned Recovery Officer is directed to co	mply
with	the above directions. In the facts	and
circu	mstances of the case, the learned Reco	very
Offi parti	cer shall pass balancing order after hearing es.	the
11. In v disp	iew of the above, Appeal No.7 of 2023 st osed of with no order as to costs.	ands
	Sd/- Presiding Officer, DRT-2, Mumbai

9. Mr

Nagori, representing the bidder, would su

bmit

that

his client has already made a bid and has off

ered

Rs.3

10 crores for the subject property in quest

ion.

The

4^threspondent’s counsel would submit that

the

learn

ed Recovery Officer was incompetent to ac

cept

any

such bid in view of the stay order passed by

this

Trib

unal on 5^thApril 2023 and 10^thApril 2023.

10. The

learned Recovery Officer is directed to co

mply

with

the
above
directions.
In
the
facts

and

circu

mstances of the case, the learned Reco

very

Offi
parti

cer shall pass balancing order after hearing
es.

the

11. In v
disp

iew of the above, Appeal No.7 of 2023 st
osed of with no order as to costs.

ands

Sd/-
Presiding Officer,
DRT-2, Mumbai

Asset reconstruction Company India Ltd. v. Daewoo Motors India Ltd. (through Ol)

Case brief

What is this about?

What did the court decide?

Asset reconstruction Company India Ltd. v. Daewoo Motors India Ltd. (through Ol)

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Parties & counsel

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