UNITED SPIRITS LIMITED Vs. IDBI BANK LIMITED

JUDGEMENT

(1.) Mr.P.Chidambaram, learned Senior counsel along with Mr.C.K.Nanda Kumar, learned counsel for the petitioners.

(2.) The Petitioner No.1 is a public limited company and is incorporated under the provisions of the Companies Act 1956, which is engaged in the business of manufacturing, marketing and selling Indian made foreign liquor, wine and other alcoholic beverages. USL Benefit Trust is a private trust set up for the purpose of holding equity shares of and in United Spirits Limited for the benefit of the petitioner No.1, its successors and assigns. The respondent No.1 is a Government of India owned Bank and is a Banking company within the meaning of Section 5(c) of the Banking Regulations Act, 1949. The respondent No.2 has been appointed as security trustee under the security trustee agreement dated 17.06.2010 entered into between petitioner No.1 and respondent No.2 to hold the security created by petitioner No.1 in favour of respondent No.1.

(3.) The petitioner No.1 approached the respondent No.1 for financial assistance and vide a sanction letter dated 18.01.2010, the respondent No.1 sanctioned a Rupee Term Loan to the tune of Rs.450 Crores in favour of the petitioner No.1 subject to terms and conditions contained in the loan agreement dated 19.01.2010. Thereafter, vide a sanction letter dated 08.04.2010 the petitioner No.1 was sanctioned a further rupee term loan of Rs.200 Crores by respondent No.1, on terms and conditions contained in the sanction letter read with loan agreement dated 08.04.2010 entered into between petitioner No.1 and respondent No.1. The share pledge agreement was executed between the parties on 17.06.2010. The USL Benefit Trust created a pledge for the benefit of respondent No.1 in respect of 34, 59, 090 equity shares of the petitioner No.1 held by USL Benefit Trust, which respondent No.2 who was appointed as security trustee in pursuance of security trustee agreement dated 17.06.2010.