TaxTMI 
TaxTMI 
2019 (11) TMI 1458
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....1 and 85/18 of Edappally south Village. It forms part of a larger extent of 83.06 Ares of Edappally south village. The property has been purchased by the claim petitioner as per sale deed bearing No.2892/2008 of SRO Edappally and it is being enjoyed by the company by effecting construction of a 16 storied commercial building. But it was attached in execution of the decree in the suit (O.S. No.417/2011). The claimant is not liable to compensate the Decree holder or to satisfy the decree debt and hence the petition was filed to lift the attachment and to allow the claim petition. 3. The decree holder resisted the petition inter alia contending that M/s. Nippon Infra Project (P) Ltd is one of the projects of the judgment debtor, namely, M/s. Infra Housing Project (P) Ltd. Both the companies have common Directors and investors. The property attached is in the joint ownership of the claim petitioner as well the judgment debtor and hence the claim petitioner has no exclusive right over the property under attachment. 4. Before the court below, the Director of the claim petitioner was examined as PW 1 and Exts. A1, A2 and A4 to A6 were marked. No oral or documentary evidence was addu....
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..... E. George who represents the judgment debtor company is also a Director of the claim petitioner company. M/s.Infra Housing Pvt. Ltd., the judgment debtor company is engaged with the project for construction of apartments and the decree holder is a customer who invested money to secure an apartment. M/s. Nippon Infra Project (P) Ltd., the claim petitioner, is engaged with construction of commercial buildings. From the available records, it is clear that the Directors of the judgment debtor company and the claim petitioner company are common. Ext.A2 also reveals that the assignees, successors etc. will derive title of the property from Sri. George E. George as he is one of the purchasers of the property. PW1 has also admitted that Sri. Geroge E.Geroge has e-mail accounts in both the companies. PW1, the claim petitioner, is also the Director of Infra housing Ltd and he, in definite terms, admitted that Sri. Geroge E.Geroge, the Director who represents the Judgment debtor company has right in the attached property. But, by the impugned order the claim petition was allowed by the Court below. The decree holder felt aggrieved, filed this appeal. The main question mooted for consider....
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....Salomon and Co.Ltd. in which a company, as a legal entity, is held to be distinct from its members, the court propounded that though as a corollary, its corporate veil normally is impervious, but when its corporate identity is applied to circumvent law, to defeat public policy, perpetuate fraud or illegality or is sought to be used as a cover or a facade to justify a wrong, defend crime, to lend a name to private dealing, law would cease to acknowledge it to be a corporate entity and afford such protection otherwise entitled to under the Companies Law. It concluded that when camouflaged transactions are carried on behind the legal front, the court may lift the veil and look behind the artificial personality of the company and identify the real personalities or natural persons operating behind the screen............" 10. In S.Sukumar v. Secretary, Institute of Chartered Accountants of India and others [(2018) 14 SCC 360], it was observed by the Apex Court as follows: "50............... The principle of lifting the corporate veil has to apply when the law is sought to be circumvented. In expanding horizons of modern jurisprudence, it is certainly permissible. Its....
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.... theory of lifting of corporate veil has to be made applicable, so as to protect the interests of the persons who approach the court seeking for a valid relief. Though a Company is a separate legal entity, the law laid down by the Apex Court in the above referred decisions have made it clear that the doctrine of lifting of veil is legally permissible when there is an attempt to evade legal obligations by using corporate personality. Here, the decree holder had invested considerable money to purchase an apartment constructed by the judgment debtor company. When there was failure to comply with the terms of the agreement entered into by the parties, the suit was filed and a favourable decree was obtained by the decree holder. So, the facts of the case would show that the intention of the judgment debtor company was to evade the reasonable or valuable right of one of its customers by hiding behind the veil and raising a contention that the claim petitioner is not liable to compensate its customer as it is a separate corporate entity. In Sukumar's case (supra) the Apex Court stressed that the horizon of the doctrine of lifting the corporate veil is expanding and its frontiers are u....