DEFAULT IN PAYMENT OF FIXED DEPOSITS WHICH GOT MATURED

[Mr. M. GOVINDARAJAN]

Section 73(2) of the Companies Act, 2013 provides that a company may, subject to the passing of a resolution in general meeting and subject to such rules as may be prescribed in consultation with the Reserve Bank of India, accept deposits from its members on such terms and conditions, including the provision of security, if any, or for the repayment of such deposits with interest, as may be agreed upon between the company and its members, subject to the fulfilment of the following conditions, namely:-

•  issuance of a circular to its members including therein a statement showing the financial position of the company, the credit rating obtained, the total number of depositors and the amount due towards deposits in respect of any previous deposits accepted by the company and such other particulars in such form and in such manner as may be prescribed;
•  filing a copy of the circular along with such statement with the Registrar within thirty days before the date of issue of the circular;
• depositing, on or before the thirtieth day of April each year, such sum which shall not be less than twenty per cent. of the amount of its deposits maturing during the following financial year and kept in a scheduled bank in a separate bank account to be called deposit repayment reserve account;
•  certifying that the company has not committed any default in the repayment of deposits accepted either before or after the commencement of this Act or payment of interest on such deposits and where a default had occurred, the company made good the default and a period of five years had lapsed since the date of making good the default; and
•  providing security, if any for the due repayment of the amount of deposit or the interest thereon including the creation of such charge on the property or assets of the company.

Where a company does not secure the deposits or secures such deposits partially, then, the deposits shall be termed as ‘unsecured deposits’ and shall be so quoted in every circular, form, advertisement or in any document related to invitation or acceptance of deposits.

Section 73(3) of the Act provides that every deposit accepted by a company shall be repaid with interest in accordance with the terms and conditions of the agreement

Section 73(4) of the Act provides that where a company fails to repay the deposit or part thereof or any interest thereon, the depositor concerned may apply to the Tribunal for an order directing the company to pay the sum due or for any loss or damage incurred by him as a result of such non-payment and for such other orders as the Tribunal may deem fit.

In ‘Ateet  Bansal, Sunita Bansal, Shweta Bansal v. Unitech Limited’ – 2020 (4) TMI 517 – NCLAT, New Delhi,  the three appellants filed these appeal before the NCLAT, New Delhi against the three impugned orders dated 30.05.2019 in Case No. 86/73(4)/ND/2019, 89/73(4)/ND/2019 and 88/73(4)/ND/2019 respectively passed by the National Company Law Tribunal, New Delhi Bench under section 421 of the Companies Act, 2013

The three appellants are depositors to the respondent company as detailed below-

•  Ateet Bansal bought a FDR for ₹ 1,00,000/- on 01.06.2013  for a period of 3 years.  On 01.06.2016, the maturity date the appellant would get ₹ 1,45,217/-
• Sunita Bansal bought a FDR for ₹ 3,00,000/- on 29.05.2013  and for ₹ 50,000/- on 28.11.2013 for  a period of 3 years.   On 29.05.2016 the maturity date the appellant would get ₹ 4,35,652/- and on 28.11.2016 the appellant would get ₹ 72,619/-
• Shweta Bansal bought a FDR for ₹ 50,000/- on 20.06.2013 for a period of 3 years.  On 20.06.2016 the maturity date, the appellant would get ₹ 72,609/-

After maturity date the respondent did not both to redeem the deposit amounts with interest to the depositors as detailed above.  The depositors approached the respondent several times for getting their matured amount with interest.  The respondent did not pay the said amount and also did not listen to the depositors.

Therefore the deposits filed company petitions in  NCLT, New Delhi,  under Section 73(4) of Companies Act, 2013 read with Section 45Q of the Reserve Bank of India Act, 1934 for payment of maturity amount of the aforesaid deposit with 12.5% interest P.A. due thereon in accordance with the terms and conditions of the deposit,  as detailed below-

• Ateet Bansal -  Company  Petition No. 86/73(4)/ND/2019;
• Sunita Bansal – Company Petition No. 89/73(4)/ND/2019;
•  Shweta Bansal – Company Petition No.88/73(4)/ND/2019.

The said petitions were admitted by NCLT, New Delhi.  No reply was filed by the respondent in all the three cases.  Therefore the NCLT, New Delhi passed an order on 30.05.2019 directing the respondent to pay the maturity amount of the deposit + 10% from the date of filing till the receipt.

Against the said order the petitioners filed the present appeal before the NCLAT, New Delhi in Appeal No. 216, 218 and 219.  The appellants submitted the following before NCLAT, New Delhi-

• No reply was sought to be filed by the respondent before NCLT, New Delhi, which clearly shows that they were in default and no objection was raised by them and due to the default in repayment of matured amount by the Respondent;
• National Company Law Tribunal, New Delhi Bench has failed to award the interest to be calculated at 12.5% P.A. from the date of maturity on the matured amount.
• The impugned order has failed to appreciate that Section 76A of the Companies Act, 2013 provides for punishment for contravention of Section 73 or section 76.
• NCLT have erred in law in deciding the matter by reducing the contracted rate of interest and also have awarded the interest from the date of filing the petition before the NCLT till realization thereof. 
•  They have also spent the litigation cost at NCLT and have also deposited the court fees in the Registry of NCLAT for filing the appeal.
• The reliefs sought by them may be awarded and heavy cost may also be imposed upon the Respondent.

The respondent submitted the following before the NCLAT, New Delhi-

• The impugned orders have been passed by the National Company Law Tribunal in a mechanical and non-reasoned manner and suffer from non-application of mind, material irregularity, and error apparent on the facts of the record and are therefore liable to be set aside.
• The impugned order has been taken by the NCLT in complete violation of the orders of the Supreme Court of India whereby the Supreme Court is unequivocally seized of the matters against the Respondent and has directed that no coercive steps shall be taken against the company or its director.
• Due to certain ongoing disputes, certain purported complaints were filed by various persons whereby aggrieved by order dated 11.08.2017 passed by this Court, the Managing Directors of the Respondent Company filed Special Leave Petitions under Article 136 of Constitution of India bearing S.L.P.(Crl) No. 5978-79 of 2017. During the course of the proceedings, vide order dated 08.09.2017, the Supreme Court appointed Mr. Pawan Shree Agarwal as amicus curiae, who directed to file a chart containing details of various projects of the Company and the name of consumers and amount deposited with the Respondent.
• Pursuant to the  Order dated 30.10.2017, the Supreme Court directed the Directors of the Respondent to deposit a total amount of ₹ 750 Crores before the Registry of the Supreme Court as a pre-condition to the grant of bail. The Apex Court further directed that no coercive steps shall be taken against the company and passed direction for the amicus curie to create a portal where the persons who have invested with the Company by way of fixed deposits shall give the requisite information.
• Supreme Court having taken strict cognizance of the payments and disbursements by the Respondent Company, time to time issued various directions to the amicus curie and further constituted Justice Dhingra Committee vide order dated 14.05.2018 to supervise the working of payments and disbursal of the money deposited by the company and the Directors before the Registry of the  Supreme Court. Upon agitation by the fixed deposit holders, vide Order dated 07.12.2018 the Supreme Court directed the Dhingra Committee to retain 10% of ₹ 174 Crore deposited by the Company with the Registry of the Supreme Court of India, towards fixed deposit holders.
• Directions were passed for the amicus curiae to obtain and furnish status of fixed deposit holders vide order dated 07.03.2019. That despite being aware of the facts that the Supreme Court was duly monitoring the payments by the company Appellant herein preferred the present appeal.
•  The main promoters are behind bar and the financial condition of the Respondent company is not good 
• The Appellants herein has been aware of the proceedings pending against the Respondent Company has even filed its claim before the amicus curie vide Amicus ID bearing No. 617 whereby the amicus curie shall disburse the refund in due time and in accordance with the directions of the Supreme Court of India and therefore the present Appeal deserved to be dismissed in limine.

The NCLAT heard the submissions put forth by the appellants and the respondent.  The NCLAT observed the following-

• The Respondent taking the shelter of Supreme Court order is creating hurdle in the process of law such as accepting notice and then not appearing. 
• The rate of interest has been reduce and for the period between maturity date and date of filing the petition has not been awarded in the impugned order.
• The appellants are not even paid any amount who has given as deposit his hard money so that the company may flourish and the economy of the country to grow.
• NCLT has reduced the rate of interest for which no justification has been given and also for not awarding interest from the maturity date to filing of the petition.
• this is a reward to the defaulting company and punishment to honest depositor who is running from pillar to post to get his amount back with interest.

The NCLAT further observed that Rules have been made to protect the interest of deposit holders and for the benefit of the economy of the country. Rules have not been to reward the defaulting company by reducing the rate of interest and not paying the interest from maturity date to filing of petition. 

The NCLAT passed orders as detailed below-

• The amount is decreed in favor of the respective appellant together with pendent lite and future interest @ 12.5% p.a. from the date of maturity of the respective FDR till receipt thereof.
• Respondent will pay ₹ 50000/- each to the above three appellants towards cost of litigation, costs etc.