Mr. Justice Anup Jairam Bhambhani

Delhi High Court has granted bail to a Director of M/s. Parul Polymers Pvt Ltd., case u/s 447 of the Companies Act, 2013 – Suman Chadha Vs. Serious Fraud Investigation Office – Delhi High Court

Hon’ble High Court held that when the petitioner appeared before the learned Special Judge in compliance of the summons issued to him, he was ‘in custody’ of the court but not ‘under incarceration’. Accordingly, the twin-conditions contained in section 212(6) of the Companies Act did not get actuated.
A reasonable interpretation of the twin-conditions leads to the conclusion that since the petitioner had not been arrested throughout the course of investigation; he had appeared before the learned Special Judge against summons – not arrest warrants – issued to him; and most importantly, when the investigating officer had not even sought police custody or judicial custody of the petitioner, the twin conditions would not apply. At that point in time, the twin-conditions stipulated in section 212(6) of the Companies Act did not automatically get actuated. What really transpired was that merely upon appearing before the learned Special Judge, as if by reflex action, the court remanded the petitioner to judicial custody; whereupon the petitioner filed a bail application; which also came to be dismissed there-and-then invoking section 212(6).
The Hon’ble High Court has admitted the petitioner to regular bail, subject to the conditions.

Delhi High Court has granted bail to a Director of M/s. Parul Polymers Pvt Ltd., case u/s 447 of the Companies Act, 2013 – Suman Chadha Vs. Serious Fraud Investigation Office – Delhi High Court Read Post »

The remedies available to a lender for enforcing a Security Interest cannot be encroached upon by any Arbitral mechanism provided in section 11 of the SARFAESI Act – Bell Finvest India Ltd. & Ors Vs. AU Small Finance Bank Ltd. – Delhi High Court

Hon’ble High Court held that the remedy of arbitration provided in section 11 of the SARFAESI Act cannot override the special remedies stipulated under the set of special laws, viz. the SARFAESI Act and the RDB Act; and therefore even statutory arbitration cannot derogate from a remedy available to a lender for enforcing a security interest and the ‘doctrine of election’ is simply not available. Accordingly, disputes that would be covered by section 11 of the SARFAESI Act are those which deal with the rights of secured creditors inter-se, since the SARFAESI Act proceeds on the basis that the liability of the borrower has been crystallized and the borrower’s account has been classified as a non-performing asset in the hands of the financial institution. In the present case, the prayer seeking reference of disputes to arbitration, especially when such disputes are already subject matter of proceedings before the DRT, Jaipur and the DRAT, New Delhi, is therefore, wholly misconceived.

The remedies available to a lender for enforcing a Security Interest cannot be encroached upon by any Arbitral mechanism provided in section 11 of the SARFAESI Act – Bell Finvest India Ltd. & Ors Vs. AU Small Finance Bank Ltd. – Delhi High Court Read Post »

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