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TMI Blog2010 (5) TMI 394X X X X Extracts X X X X X X X X Extracts X X X X ..... any') incorporated under the Companies Act, 1956 ('the Act') had advanced a term loan of Rs. 90 lakhs to M/s. La Medical Devices Limited ('the LMDL Company'). In the wake of Company Petition No. 42 of 1999, the LMDL Company was ordered to be wound up by this Court, vide order dated 7-4-2004. An Official Liquidator was, accordingly, appointed. He ultimately took over all the assets of the Company. Thereafter, on the application of the Liquidator, learned Company Judge ordered the sale of its assets. After publishing the sale notice in the various newspapers, this Court confirmed the sale in favour of M/s. FCS Software Solutions Limited for Rs. 1.47 crores, being the highest bid. 3. It was claimed that the original promoter of the Company feeling aggrieved by the said auction, as being much below the market value, filed objection petition, i.e., CA No. 365 of 2004. On the said objections and application filed by others, the learned Company Judge, after noticing the bids of other bidders and the submission of original promoter for re-auction, directed the Official Liquidator not to hand over the possession of the property. Thereafter, the learned Company Judge ordered for re-advertis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uance of OTS scheme (Annexure A 3) and agreement (Annexure A 4). 6. The LMDL Company claimed that having made the payment in pursuance of OTS scheme to all the creditors now, it stepped into the shoes of secured creditors and is entitled for the amount already paid by it from its own sources discharging the liability of principal debtor. 7. In order to achieve the desired results, C.M. Jain Ex-Managing Director of LMDL Company moved an application before the learned Company Judge for directing the Official Liquidator to pay to the creditors (respondent Nos. 2 to 4) the balance amount from the sale proceeds amounting to Rs. 3.50 crores of assets of the company (in liquidation), which has been left as per the OTS scheme arrived at and also to pay to it the amount already deposited with the creditors on entering into OTS scheme as it has stepped into the shoes of creditors/secured creditors, invoking the provisions of rules 6 and 9 of the Companies (Court) Rules, 1959 read with section 151 CPC. 8. The PICUP Company contested the application and filed short reply only to the effect that as it has already cancelled the OTS proposal having been not availed in time, vide letter dated 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... approximately the entire amount in pursuance of the OTS scheme, so, no interference is warranted in the interim impugned order in this respect. 14.We have heard the learned counsel for the parties and have gone through the record with their valuable assistance. 15. In the judgments relied on behalf of the appellant in the cases of Central Bank of India v. Ravindra 2002 (1) SCC 367 and Corporation Bank v. D.S. Gowda 1994 (5) SCC 213, after considering the provisions of the Banking Regulation Act, 1949 and guidelines of Reserve Bank of India, it was observed that "there is no provision under the SIDBI Act, 1989 or under the State Financial Corporation Act, 1951 comparable to the provisions of sections 21 and 35A of the Banking Regulations Act, 1949. In the absence of such analogous provision, the guidelines issued by the SIDBI are not binding on the Financial Corporation." 16. Sequelly, in Knitex Overseas (P.) Ltd.'s case (supra), after interpreting the provisions of sections 21 and 35A of the Banking Regulations Act, 1949, it was observed that "One Time Settlement Scheme issued by the Reserve Bank of India do not have any statutory roots. Therefore, such schemes do not confer an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay or act". The settlor administered the trust property for sometime and thereafter thought of effecting by deed inter vivos certain changes in the trust. To enable him to do so he took out an originating summons on the original side of the Calcutta High Court under Chapter XIII of the Original Side Rules of that Court seeking primarily two reliefs viz., (1) to have the Official Trustee, Bengal appointed as the Trustee in his place and (2) to empower him to alter the clause relating to variation of the quantum of interest given to each of the beneficiaries by a deed inter vivos. What the settlor asked for was the Court's permission to revoke the clause in the Trust deed empowering him to alter the quantum of interest given to each of the beneficiaries "by will alone" and in its place to confer upon him power to make the said alteration by deed inter vivos. The Court in specific terms ordered the revocation and granted the authority sought for. On the peculiar and in the circumstances of that case, it was observed that "the said order was outside the jurisdiction of the Court. The same would not come to the rescue of PICUP Company." 22. Section 446(1) of the Companies Act postulate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cheme can be enforced. Reliance in this regard can be placed on the judgment of Hon'ble Supreme Court in the case of State Bank of India v. Vijay Kumar AIR 2007 SC 1689. 26. Likewise, a Division Bench of this Court in the case of Sat Kartar Ice & General Mills v. Punjab Financial Corpn. 2008 (1) ISJ (Banking) 248 has held that "if a borrower failed to adhere to the agreed time schedule but paid the agreed amount though belatedly and paid interest for delayed payment, then the High Court has the jurisdiction to restore and implement the One Time Settlement between the parties". 27. Similarly, in Vijay Kumar v. State Bank of India [CWP No. 15032 of 2005, dated 26-5-2006], the matter was settled between the petitioner and the bank before the Lok Adalat and in pursuance of the compromise, the petitioner deposited the amount, though belatedly. It was observed by this Court as under :- "This Court feels that by depositing Rs. 2,00,000 within the stipulated period, the petitioner has shown his intention to comply with the terms and conditions of the compromise, may be due to some financial constraint, as has been alleged by the petitioner, he was not in a position to deposit the remain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... afterwards". Meaning thereby, once the OTS proposal (Annexure A 3) was incorporated in agreement (Annexure A 4), then the same cannot legally be revoked and the parties to such contract are legally required to perform their respective promises as contemplated under Chapter IV of the Contract Act. If any party breaches the contract, then he will face the consequences and aggrieved party would be entitled for compensation for loss or damage caused by breach of contract under Chapter VI of the Contract Act. Therefore, we are of the considered view that once the OTS proposal (Annexure A 3) has been matured into agreement" (Annexure A 4), then the PICUP Company was not legally competent to revoke the same, under the present set of circumstances. Therefore, the learned Company Judge has rightly implemented the OTS scheme between the parties. Hence, the contrary arguments of the learned counsel for PICUP Company "stricto sensu" deserve to be and are hereby repelled, in the obtaining circumstances of the case as above indicated legal provisions are the complete answer to the problem in hand. 30. Now adverting to the second appeal filed by the Official Liquidator of the LMDL Company (in li ..... X X X X Extracts X X X X X X X X Extracts X X X X
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