IFCI ordered to refund Rs 57.50 lacs with interest for failing to provide proper accounting documentation

Delhi HC directed IFCI to refund Rs. 57.50 lacs deposited by applicant pursuant to DRT order dated 03.06.2009, along with interest from deposit date. IFCI failed to provide proper accounting or bifurcation of amounts received from property sales/auctions under DRT. Court found IFCI's explanation regarding remittance to Official Liquidator inadequate and unsubstantiated. Despite IFCI's claims that the amount was included in Rs. 88,66,077/- payment made in February 2015, no proper documentation or covering letter supported this assertion. Court held IFCI accountable and liable for refund with interest. Application allowed.

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Issues Involved:
1. Refund of deposit by the Official Liquidator.
2. Condonation of delay in filing status report by the Official Liquidator.
3. Failure of IFCI to provide a detailed break-up of auction proceeds.
4. Accountability of IFCI for the refund amount.

Summary:

1. Refund of deposit by the Official Liquidator:
The applicant, a third-party objector, sought a refund of Rs. 57.50 Lacs deposited pursuant to an order by the DRT on 03.06.2009. The DRT had ordered the auction of the company's assets, and the applicant deposited the amount intending to purchase the property. However, the auction was later set aside, and the amount was to be refunded. The applicant's request for a refund was declined by the DRT, directing him to approach the Official Liquidator, as the amount had been transferred to the IFCI and subsequently to the Official Liquidator.

2. Condonation of delay in filing status report by the Official Liquidator:
The Official Liquidator sought condonation of delay in filing the status report OLR No. 15/2024. The delay was condoned, and the report was taken on record.

3. Failure of IFCI to provide a detailed break-up of auction proceeds:
The IFCI deposited Rs. 13,10,19,293/- with the Official Liquidator but failed to provide a detailed break-up of the amounts received from the sale of various assets. Despite multiple court orders, IFCI did not furnish the necessary details, leading to difficulties in verifying whether the applicant's deposit was included. The court repeatedly directed IFCI to file a detailed break-up and held them accountable for non-compliance.

4. Accountability of IFCI for the refund amount:
The court found that IFCI failed to account for the applicant's deposit of Rs. 57.50 Lacs. The affidavits and statements provided by IFCI did not substantiate the inclusion of the applicant's deposit in the remittances made to the Official Liquidator. Consequently, the court directed IFCI to refund Rs. 57.50 Lacs to the applicant along with interest at 18% per annum from the date of deposit until realization. If the amount is not paid within six weeks, IFCI would be liable to pay penal interest at 24% from the date of judgment until realization.

Conclusion:
The application by the third-party objector was allowed, directing IFCI to refund the amount with interest, and the application was disposed of accordingly.

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