TaxTMI 
TaxTMI 
2019 (11) TMI 1458
X X X X Extracts X X X X
X X X X Extracts X X X X
....wing the claim petition filed under Order XXI Rule 58 of the Code of Civil Procedure as E.A. No. 288 of 2018, in E.P. No. 232 of 2017, and lifting the attachment effected by the execution Court. 2. The claim petitioner is M/s. Nippon Infra Project (P) Ltd. represented by its Director Sri.John George. The property scheduled in the petition is having an extent of 41.997 Ares comprised in Sy. Nos. 85/19/A/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 atta....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d by its Director Sri. George E. George. As per Ext.A2 Sale Deed No.2892/2008, the property attached was purchased along with a larger extent by M/s. Nippon Infra Project (P) Ltd, a company registered under the Companies Act,1956. Ext.AI is the certificate of incorporation of M/s. Nippon Infra Project (P) Ltd. As borne out from Ext.A2, Sri.George E. George, the Director of M/s. Infra Housing Pvt. Ltd is also a Director of M/s. Nippon Infra Project (P) Ltd, the claim petitioner. It is pertinent to note that the Memorandum and Articles of Association of both the companies have not been produced and therefore the entire details of the Directors of the Companies are not available. According to the appellant, both the companies, M/s. Infra Hous....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 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 consideration in this appeal is whether the execution court was....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ion of law or injustice to the public, customers/third parties who approach them for their business. 8. The Apex Court in State of Rajasthan v. Gotan Lime Stone Khanij Udyog (P) Ltd., [(2016) 4 SCC 469), held as follows: "24. The principle of lifting the corporate veil as an exception to the distinct corporate personality of a company or its members is well recognised not only to unravel tax evasion but also where protection of public interest is of paramount importance and the corporate entity is an attempt to evade legal obligations and lifting of veil is necessary to prevent a device to avoid welfare legislation.....'' 9. The Apex Court in State of Karnataka v. J. Jayalalitha and others [(2017) 6 SCC 263] held in para 532 as ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....improper conduct or for violation of law. Protection of public interest being of paramount importance, if the corporate personality is to be used to evade obligations imposed by law, the real state of affairs needs to be seen........" 11. In State of U.P. v. Renusagar Power Co. [(1988) 4 SCC 59] the Apex Court observed in para 66 as follows: "66. It is high time to reiterate that in the expanding horizon of modern jurisprudence, lifting of corporate veil is permissible. Its frontiers are unlimited. It must, however, depend primarily on the realities of the situation. The aim of the legislation is to do justice to all the parties. The horizon of the doctrine of lifting of corporate veil is expanding.........'' . In para 67, it w....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e 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 o....