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TMI Blog2018 (12) TMI 1436X X X X Extracts X X X X X X X X Extracts X X X X ..... nts cannot hold on to a security in the absence of a written agreement. Under such circumstances the right to claim the shares or to redeem the pledge cannot be adjudicated by this forum. The pledge of shares necessitates only possession to be handed over. The pledgee has a right to hold on to them as security in the event of bailing out the pledgor, till he is duly paid. The respondents submit that they are ready and willing to return the shares upon their claim being satisfied. No merit in the prayer made by the petitioner. This Bench does not find it equitable to direct the respondents to hand over the share certificates over which they assert their lien having bailed out Apsom Turner P. Ltd., by liquidating the outstanding liability ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... naction in issuing duplicate certificates, the petitioner has invoked the jurisdiction of this Bench praying that respondent No. 1 be directed to do the needful. 3. It would be pertinent to note the relevant background of the parties. The petitioner and respondent No. 2 are brothers, being sons of Shri Madan Lal Mundra, who in turn is one of the lineal decedents of late Shri Suraj Lal Mundra. In terms of the family settlement between the lineal decedent of Shri Suraj Lal Mundra, the businesses were divided, pursuant to which 87,010 fully paid-up equity shares of ₹ 10 each of the respondent-company were transferred to the petitioner. This is duly reflected in the annual returns of the company. The reins of respondent No. 1-company h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that of the principal debtor and it will not be necessary for you to proceed against the borrower or any other guarantor as a condition precedent for enforcing your rights against as hereunder. (b) This guarantee shall be a continuing guarantee and shall be irrevocable and shall continue until borrower discharges all its obligations to you under the loan agreement fully and to your entire satisfaction. (c) This guarantee shall not in any manner be affected or prejudiced by any time or indulgence you may grant to the borrowers or any cancellation, modification or amendment in the loan agreement or by your releasing any other guarantee or security that you may have in connection with the aforesaid. (d) I shall be liable to pay to you ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orporate guarantee for the loan availed by M/s. Apsom Turner P. Ltd., at his instance. Copy of the corporate guarantee and personal undertaking of respondent No. 2 to remain liable to liquidate the debt of Apsom Turner has been placed on record. It is also not repudiated that respondent No. 1company has paid a sum of ₹ 1.2 crores on invocation of the guarantee to M/s. Celica Developers P. Ltd., which they seek to recover from Apsom Turner in a suit filed by them. The only resistance to this plea is that there was no agreement in writing pledging the shares, and therefore holding on to them as security is wholly illegal and unauthorised. 10. On appraisal of the facts of the case it emerges that the petitioner had deliberately made f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under the shares in execution proceedings if the pledge is not redeemed. It would be grossly inequitable to direct the respondent to hand over the security to the petitioner without the claim of the respondents being satisfied. On payment of the guaranteed debt in full, the surety is entitled to all securities assigned to him, which can only be adjudicated by a civil court. 12. Given the facts of the case, the prayer of the petitioner is beyond the scope of section 46 or 56 of the Companies Act, 2013. No direction can be given by this Tribunal as it involves adjudication and not mere directions of the kind envisaged under the abovementioned provisions. 13. C. P. No. 15/04/2016 stands dismissed. No order as to costs. - - TaxTMI - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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