VIDEOCON INDUSTRIES LIMITED Vs. RAM RAJ BHANDARI

JUDGEMENT

(1.) The instant appeal has been filed under Sec. 96 of the Code of Civil Procedure, 1908 (hereinafter referred to as 'the Code') read with Order 43 Rule 1 of the Code, assailing the order dtd. 21/3/2022 passed by the learned trial Court whereby, the plaint of the Appellants herein (hereinafter referred to as 'plaintiff companies') was rejected under Order VII Rule 11(d) of the Code against the Respondents herein. FACTUAL MATRIX

(2.) The facts necessary for the disposal of the present appeal are that the plaintiff companies held 50.21% equity shares in Tirupati Ceramics Limited (hereinafter referred to as 'TCL') being 30,00,000 equity shares of Rs.10.00each and also have a nominee Director on the Board of said company. TCL was declared as a sick company and consequently, proceedings were pending before the Board for Industrial and Financial Reconstruction (hereinafter referred to as 'BIFR'). The plaintiff companies applied for impleadment as a party to such proceedings to which the Respondent No.1 and 2 through TCL opposed but the BIFR allowed the impleadment application. This order allowing impleadment was challenged by TCL before the Appellate Authority for Industrial and Financial Reconstruction, Delhi (hereinafter referred to as 'AAIFR') which was dismissed and a further appeal to the Delhi High Court in W.P. (C) No. 11327/2015 was also dismissed by the Division Bench of this Court.

(3.) During the pendency of the proceedings before BIFR, the plaintiff companies entered into a Memorandum of Understanding (hereinafter referred to as 'MoU') dtd. 25/1/2011 with Respondent No.3 to transfer the said 50.21% of the issued share capital of TCL to the Respondent No.3, and the Respondent No.3 in return agreed to deposit Rs.60.00 lakhs with the plaintiff companies as security for the performance of the said MoU. In furtherance of the MoU, the plaintiff companies delivered the original share certificates covering the shares along with a Transfer Deed signed in blank as a security for the fulfilment of its obligation under the MoU. It was further agreed between the parties to the said MoU that the Respondent No.3 will not lodge the said shares for transfer until the conclusion of the proceedings before the BIFR and hence, till such time the plaintiff companies would remain as the owners of the respective shares and that the said MoU does not confer any right or title in the Respondent No.3 in the said shares except merely an option to purchase the same after conclusion of the proceedings before the BIFR.