2024 (5) TMI 425 - HC - Companies Law

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

LORD KRISHNA BANK LTD. Versus KOSHIKA TELECOM LTD.

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 ... Direction to refund the amount deposited by the applicant pursuant to the directions/order dated 03.06.2009 by the learned DRT, Delhi along with due interest from the date of deposit - IFCI did not provide a break-up or bifurcation of the amounts received with respect to the properties sold/auctioned under the aegis of the learned DRT - HELD THAT:- ICFI is cutting an extremely sorry figure in demonstrating that the amount of Rs. 57.50 Lacs received from the applicant/third party objector was remitted to the Official Liquidator comprised in the payment made on 26.02.2015/27.02.2015 amounting to Rs. 88,66,077/-. First things first, evidently the amount of Rs. 57.50 Lacs, which was deposited by the applicant/third party objector with the DRT was remitted to the ICFI and received by it on 19.03.2010. The applicant/third party objector was constrained to move the instant application before this Court on 01.05.2017 and the matter has lingered on for want of submission of better particulars on the part of IFCI. Even in Annexure ‘C’, filed with the affidavit dated 04.02.2022, the receipt of Rs. 57.50 Lacs from Mr. Sachin Jain i.e. the applicant/third party objector is not accounted for. There is no covering letter accompanied with the remittances that have been made on 26/27.02.2015 so as to suggest that the amount of Rs. 88,66,077/- included the refund of amount of Rs. 57.50 Lacs with interest payable to the applicant/third party objector - Even assuming the deposition in the affidavit dated 28.02.2024 to be correct for the sake of convenience and it is true that the amount, which was refunded to the S.K. Trading with regard to the property at Haldwani, had been refunded, by the same very logic the tabulated statement should have shown the amount which is due to the applicant/third party objector. The IFCI has not duly accounted for the amount payable to the applicant/third party objector. The details of the remittances made by IFCI to the Official Liquidator are yet to be verified and their claims as to the secured creditor are yet to be adjudicated upon by the Official Liquidator, apart from the other secured creditor, which is IDBI. Therefore, unhesitatingly, this Court finds that IFCI remains accountable and liable to make payment of Rs. 57.50 Lacs to the applicant/third party objector and the said amount should be refunded along with interest. The present application moved by Mr. Sachin Jain i.e. applicant/third party objector is allowed. 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.