Requirement for sending a reasonable notice to the Pledgor under Section 176 of the Contract Act, prior to the actual sale is not required in case of sale of dematerialised securities because the provisions of the Contract Act, will not be applicable for enforcing a share pledge – India Power Corporation Ltd. Vs. Meenakshi Energy Ltd. – NCLAT New Delhi
NCLAT held that it is true that after invocation of the pledge, Shares were transferred in dematerialised form in the DP Account of SBI CAP Trustee Company Ltd. and it became the beneficial owner of the shares it does not mean that the Financial Creditor became the beneficial owner of the shares and it losses the status of Financial Creditor.
With the aforesaid, we hold that the Financial Creditor has not filed the Application under Section 7 of I&B Code, in pursuant to the RBI Circular dated 12.02.2018 and even after invocation of the pledged shares by SBI CAP Trustee Company Ltd., the financial Creditor can maintain the Application. Learned Adjudicating Authority has rightly admitted the Application under Section 7 of I&B Code. It is undisputed fact that the Corporate Debtor has committed default in repayment of debt and the amount of debt is more than 1 Lakh.
