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2003 (10) TMI 406 - HC - Companies Law
Issues:
Jurisdiction of the Tribunal to decide on recovery of debt under the Facility Agreement. Analysis: The petitioners challenged orders passed by the Tribunal for recovery of debt under the Facility Agreement. The petitioners argued that the Tribunal lacked jurisdiction as per the Facility Agreement, which vested jurisdiction in English Courts. However, the Tribunal held that Indian Courts had jurisdiction. The petitioners contended that the Tribunal exceeded its jurisdiction and contravened the Facility Agreement. They sought a writ of certiorari and prohibition due to the alleged lack of jurisdiction. The respondent argued that the Tribunal's decision was valid under the Act, as appeal options were available. The respondent highlighted Section 20 of the Act allowing appeals against Tribunal orders. The respondent emphasized that since the order was not stayed during the appeal process, the Tribunal's decision on merits was justified. The respondent also noted the petitioners' non-payment towards the loan, justifying the Tribunal's decision to allow the Bank's application for recovery. The petitioners cited legal precedents to support their argument, emphasizing the jurisdiction clause in the Facility Agreement. They relied on case law to assert that the English Courts had exclusive jurisdiction as per the agreement. However, the Court found that the clause did not exclude Indian Courts' jurisdiction, especially when part of the cause of action arose in India. The Court concluded that the documentation and loan sanction process occurred in India, establishing part of the cause of action in India. The Court rejected the petitioners' claim of lack of jurisdiction and upheld the Tribunal's decision. The Court also dismissed the argument for a writ of certiorari based on the lack of jurisdiction or procedural violations. Regarding the availability of alternative remedies, the Court noted that an appeal under the Act was a viable option for the petitioners. The Court highlighted the requirement to deposit 75% of the debt amount for the appeal to be entertained. However, the Court mentioned the provision for waiver or reduction of the deposit amount by the Appellate Tribunal, advising the petitioners to pursue this route. Ultimately, the Court dismissed the writ petition, emphasizing the availability of alternative remedies through the appellate process. The Court upheld the Tribunal's decision on jurisdiction and debt recovery under the Facility Agreement.
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