2016 (3) TMI 424 - HC - Indian Laws

One Time Settlement in respect of the dues of the applicant - Held that - The opponent No.5-IDBI Bank has accepted One Time Settlement in respect of the dues of the applicant agreeing to accept crystalised amount of ₹ 66.38 lakhs, following directions are issued. (i) Applicant and opponent No.5-Industrial Development Bank of India Limited are permitted to give effect to their One Time Settlement of dues as above; (ii) Registry of this Court shall issue a cheque after breaking Fixed Deposit, if required, out of the amount lying with it pursuant to order dated 15th January, 2009 in Special Civil Application No.11524 of 2002 so as to issue cheque in the name of Industrial Development Bank of India Limited ; (iii) Since under the One Time Settlement Scheme deadline for acceptance of the amount if fixed 15th March, 2016, Registry shall see to it that cheque is issued on or before 15th March, 2016; (iv) Upon receipt of the aforesaid amount, opponent No.5-IDBI Bank shall issue No Due Certificate to the applicant within two week; (v) Balance amount shall remain invested in the Fixed Deposit.

Summary

Issues:
1. Direction for issuance of a cheque for a specific sum from the sale proceeds.
2. Background of financial assistance and mortgage of immovable property.
3. Unpaid luxury tax leading to a notification for sale of mortgaged property.
4. Court orders related to the sale proceeds and disbursement to financial institutions.
5. Settlement of dues with Charotar Nagrik Cooperative Bank.
6. One Time Settlement with IDBI Bank and directions for cheque issuance.

Analysis:
1. The judgment involves an application for a direction to issue a cheque for a sum of Rs. 66.38 lakhs to the "Industrial Development Bank of India Limited" from the sale proceeds pursuant to a previous judgment. The applicant and IDBI Bank had agreed on a One Time Settlement for this amount by a specified date.

2. The applicant company had availed financial assistance from various institutions secured by a mortgage of immovable property. Due to unpaid luxury tax, a notification for sale of the mortgaged property was issued. The court highlighted the lenders' pari pasu charge over the mortgage property.

3. The court discussed the background of the unpaid luxury tax leading to a notification for sale of the mortgaged property and the subsequent legal actions taken by the parties involved. Various financial institutions and a cooperative bank were part of the proceedings.

4. Detailed court orders were passed regarding the disbursement of the sale proceeds to different financial institutions and government authorities. Specific amounts were allocated to each entity, and conditions were set for the return of funds if found not recoverable. The judgment also addressed the workers' dues and the investment of the remaining balance.

5. The judgment mentioned the settlement of dues with Charotar Nagrik Cooperative Bank and a specific order related to the withdrawal of the State's claim towards luxury tax.

6. Finally, the judgment approved the One Time Settlement between the applicant and IDBI Bank, issuing directions for the issuance of a cheque, timelines for compliance, and further considerations on a specified date. The court allowed IDBI Bank to obtain a copy of the order for necessary procedures pending procedural clearance.