SBI HOME FINANCE LIMITED Vs. CREDENTIAL FINANCE LIMITED

JUDGEMENT

(1.) THIS Appeal is directed against an order of the learned single Judge (Rebello, J.) dated 3rd August, 2000 made in Notice of Motion No. 908 of 2000 dismissing the Notice of Motion as against the second respondent and vacating the ad-interim injunction orders as against the third and the fourth respondent. The learned single Judge has narrated the facts in detail in the order and, therefore, it is not necessary to reproduce the facts in extenso. However, some of the salient facts required for decision of the Appeal may be recounted.

(2.) THERE is an agreement for bill discounting on certain terms and conditions between the appellant-original plaintiff and the first respondent (original first defendant) under which the plaintiff had extended certain facilities to the first respondent. These were guaranteed by the second respondent (original second defendant ). The appellant, therefore, brought a Money Suit for recovery of Rs. 13,42,00,023/- against the first and second respondent. The Notice of Motion was taken out for attachment before judgment of two tangible assets of the first respondent being two office premises at Nariman Point, Mumbai. It was alleged in the affidavit-in-support of the Notice of Motion that the first respondent owed a large sum of monies to the appellant and the claim of the appellant was virtually admitted. It was pointed out that a Suit had been filed in the Calcutta High Court against the first respondent wherein an attachment before judgment was ordered against the first respondent. The first respondent did not appear, but the attachment order was modified from time to time at the instance of the second respondent. Finally, however, the Suit itself was dismissed as being beyond the territorial jurisdiction of the Calcutta High Court. Hence, the present Suit was brought in this Court against the first and second respondents.

(3.) ON the basis of the material presented before him, the learned single Judge (Nijjar, J.) took the view that the first respondent had only two tangible assets being the office premises at Nariman Point, Mumbai. It was admitted that this had been sold off to the third and fourth respondents whose registered office address were also shown to be situated at the office address of the first respondent. It was, therefore, contended on behalf of the appellant that the first respondent was closely connected with the third and the fourth respondents and that the transfer was intended to defraud the creditors, or at any rate, to delay or defeat the decree that might be made in the Suit. Certain circumstances, like the filing of a winding up petition against the first respondent and compromise entered into therein by the first respondent, filing of an independent Suit by the appellant against the first respondent in which a Receiver had been appointed, were also pointed out to the learned single Judge to indicate that there was acute financial stringency faced by the appellant. On a conspectus of all facts presented to him, Nijjar, J. was of the view that though certain defences had been urged by the first and the second respondent, their worth could have to be tested and adjudicated at the trial, but that pending hearing of the Notice of Motion, the interest of the plaintiff had to be protected by an ad interim order. Consequently, the learned single Judge (Nijjar, J.) made an ad interim order on 6th April, 2000 directing the first and the second respondents to furnishs security towards the appellants suit claim in the amount of Rs. 13,42,00,23/-, either by the first respondent alone or by equal contributions by the first and the second respondents, if so agreed upon between them. A period of six weeks was granted for furnishing the security. Till the security was furnished, the first respondent was injuncted from alienating, encumberating, parting with possession of, disposing of or creating any third party rights or inducting anyone into the aforesaid office premises at Nariman Point, Mumbai.