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TMI Blog2022 (2) TMI 1394X X X X Extracts X X X X X X X X Extracts X X X X ..... w taken by the court below is reasonable on facts and in law. When there are circumstances suggesting that despite possessing the means, the judgment-debtor has neglected and refused to pay the decreetal amount, furnishing of security by judgment-debtor is warranted. The security is considered proper to be solicited by the judgment-debtor to ensure that the rights of the decree holder are not defeated. In exercise of powers Order XXI Rule 40(b) of the Code of the Civil Procedure, 1908, requires the judgment debtor to furnish security and sum of Rs. 12,89,19,458/- which is the equivalent amount to the worth of the book value of shares in the four Australian companies held by the judgment-debtor. The impugned order is proper and reasonable in law as such in directing the judgment-debtor in furnish security - while no ground exists to interfere with the said order requiring the judgment-debtor to furnish the security to the aforesaid extent, what becomes conspicuous in the impugned order that the said security is directed to be furnished by way of cash deposit with the Registry of this Court. While maintaining the impugned order as well as the reasons supplied by the Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etitioner had executed personal guarantee in Australia in favour of the respondent- decree-holder for the benefit of company called Gujarat NRE Coke Limited for USD 4,259,395/-. The said Gujarat NRE Coke Limited did not pay the entire amount, as a result of which the suit was instituted in the Commercial Court in England. It culminated into judgment and decree dated 9.11.2017 holding the petitioner liable to make payment of USD 4,259,395/-. 3.2 The respondent filed Execution Petition No. 4 of 2018 before the Commercial Court at Rajkot for executing the said decree, which proceedings came to be transferred subsequently to the competent court at Jamnagar and came to be renumbered as Commercial Execution No. 161 of 2019. The decree passed by the Commercial Court at England has been held to be executable under Section 44-A(1), CPC, 1908 and by virtue of deeming fiction, the said foreign decree has merged into judgment decree. 3.3 It is to be mentioned that in the aforesaid execution proceedings the decree-holder had filed applications Exhibit Nos.54, 56 and 58. The application Exhibit No.54 was against the order whereby the judgment-debtor was required to show cause as to why he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d his presence was noticed in Gujarat in Gandhinagar on particular day. It was further stated that the judgment-debtor in his affidavit of assets dated 11.1.2020 stated in paragraph No.6(a) that I own the following House Properties in my name (a) House Property named NRE House, at 45 A Saru Section Road, Jamnagar, 361008. It was stated that in the said affidavit he valued his cumulative assets both in India and abroad to the approximately 23.82 crores as on 15.12.2019. 3.5.2 The decree-holder stated that the value of assets of the judgment-debtor comprising of his own and the persons in near trust is much higher than 23.82 crores, averring as under. This is inter alia evident from the fact that even as on date the judgment-debtor is prosecuting Civil Appeal No. 9664 of 2019 before the Hon'ble Supreme Court of India in which he is seeking approval of a Composite Scheme of Compromise and Arrangement between the judgment-debtor and the Creditors and Shareholders of Gujarat NRE Coke Limited (In Liquidation) under sections 230 to 232 of the Companies Act, 2013 in which the judgment debtor is the Applicant and which inter alia provides The applicant would bring in towards P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st of investment and shares and that the actual realizable value of the shares is less than the book value. It was claimed by judgment-debtor that as such he did not have the means to satisfy the decree. 3.6.1 About the scheme of compromise and arrangement, it was stated that the same was proposed by the judgment-debtor as a shareholder and promoter of Gujarat NRE Coke and that the proposal to inject sum of Rs. 50 crores had been made on behalf of all the shareholders in order to revive the company and this amount has nothing to do with personal assets of the judgment debtor. It was again claimed that even the book value of the shares highlighted by the decree-holder was meaningless since the current market value is in minuscule. It was stated that the judgment-debtor has not transferred any assets. 3.6.2 About the value of investments in the shares of four Australian companies, the judgment-debtor made this averment in paragraph No. 10 of his reply, If the decree-holder believes that the value of investment in shares of these 4 Australian companies is 12.89 crores the judgment-debtor is happy to transfer all these shares to the decree-holder for a sum of Rs. 12.89 crores in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erring to the affidavit dated 12.2.2020 of the judgment-debtor, it was noted that book value of the shares in the Wollongong Coal Limited, Goldrich Resources Limited, Shree Minerals Limited, Gujarat NRE Private Limited and are worth Rs. 12,89,19,458/-. The aspect was also noted by the court below that the judgment-debtor was being examined in interrogatories regarding the debts as well as the property owned by him for the purpose of satisfaction of the foreign decree in question. 5.3 The affidavit dated 12.2.2020 of the judgment-debtor is referred to to state that therein the book value of the shares in four Australian companies, as above, are worth Rs.12,89,19,458/- as on 15.12.2018. The aspect is noted that the decree-holder is granted leave to deliver interrogatories for the examination of the judgment-debtor as to any information or what debts are owned by the judgment-debtor and what other property and means the judgment-debtor has, to satisfy the decree. 5.4 In paragraph No.17, it was stated and observed by the Court as under. 17. The evidence on record goes to show that while on one hand the JD has declared in his affidavit dated 11th January 2020 and subsequent af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore that order for furnishing security deserved to be passed. The view taken by the court below is reasonable on facts and in law. 5.8 In view of all the above facts and background and when there are circumstances suggesting that despite possessing the means, the judgment-debtor has neglected and refused to pay the decreetal amount, furnishing of security by judgment-debtor is warranted. The security is considered proper to be solicited by the judgment-debtor to ensure that the rights of the decree holder are not defeated. 5.9 It is in on such premise of facts and reasons, the impugned order, as above, in exercise of powers Order XXI Rule 40(b) of the Code of the Civil Procedure, 1908, requires the judgment debtor to furnish security and sum of Rs. 12,89,19,458/- which is the equivalent amount to the worth of the book value of shares in the four Australian companies held by the judgment-debtor. The impugned order is proper and reasonable in law as such in directing the judgment-debtor in furnish security. 6. In view of the above discussion, while no ground exists to interfere with the said order requiring the judgment-debtor to furnish the security to the aforesaid extent, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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