Court allows sale of mortgaged properties under conditions, sets Escrow Account, parties to cooperate. The Court declined to stay the interim order dated 12th March, 2018, but allowed the State Bank of India (SBI) and Joint Lenders to proceed with the sale ...
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Court allows sale of mortgaged properties under conditions, sets Escrow Account, parties to cooperate.
The Court declined to stay the interim order dated 12th March, 2018, but allowed the State Bank of India (SBI) and Joint Lenders to proceed with the sale of mortgaged properties under certain conditions. Proceeds from the sale are to be held in a separate Escrow Account pending the appeal's outcome. All parties must cooperate in the sale process. The matter is set for further proceedings before the 1st Court on 18th April, 2018, ensuring a balanced approach to the legal complexities involved in issuing interim orders and managing property sales under the Companies Act, 2013.
Issues Involved: Competency of National Company Law Tribunal to pass interim orders under Section 242 of the Companies Act, 2013.
Analysis:
The judgment revolves around the question of whether the National Company Law Tribunal (NCLT) has the authority to issue interim orders as per Section 242(4) of the Companies Act, 2013. The appeal challenges an interim order dated 12th March, 2018. The Tribunal issues notices to the Respondents, with some already represented by counsel and no notice required for them. The remaining Respondents are to be served via speed post, with a deadline for filing replies. The Appellants are directed to provide a certified copy of the impugned order promptly.
The Court hears arguments from both parties' counsels, including Senior Counsel for the Appellants and counsel for the Contesting Respondents. Additionally, Senior Counsel for the State Bank of India (SBI) informs the Court of their intent to file an appeal against the same impugned order. The Court considers the implications of staying the impugned order, noting that such action could effectively grant final relief. Consequently, the Court refrains from staying the order but grants the SBI and Joint Lenders the liberty to proceed with the sale of mortgaged properties, subject to certain conditions. The proceeds from the sale are to be held in a separate Escrow Account pending the appeal's outcome, with all parties required to cooperate in the sale process.
The matter is scheduled for further proceedings before the 1st Court on 18th April, 2018. The judgment carefully balances the interests of the parties involved while addressing the legal complexities surrounding interim orders and the sale of mortgaged properties under the Companies Act, 2013.
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