IDBI BANK LIMITED Vs. ICICI BANK LIMITED

JUDGEMENT

(1.) The Appeal is filed under provisions of Sec. 13(1- A) of the Commercial Courts Act, 2015 challenging the judgment and order dtd. 29/9/2022 passed by learned Single Judge of this Court dismissing Interim Application (L) No.2102 of 2022 filed by the Appellant seeking interim injunction.

(2.) Brief facts leading to filing of the present Petition, in a nutshell, are that National Highway Authority of India (NHAI) and Lanco Devihalli Highway Limited (LDHL) had entered into a Concession Agreement dtd. 9/7/2007 for construction of a road on Build, Operate and Transfer Basis. A Substitution Agreement dtd. 8/2/2008 was executed between State Bank of India (SBI) and Dena Bank (now Bank of Baroda) (collectively referred to as Senior Lenders), LDHL and NHAI inter alia providing that the Senior Lenders shall be entitled to appropriate any consideration received for the substitution as provided from the Selectee towards payment of their and NHAI's respective dues to the exclusion of LDHL. Rupee Facility Agreement was executed between ICICI and LDHL on 13/6/2012 under which ICICI provided Rupee Facility of INR 90 crore to LDHL. A Master Restructuring Agreement was executed by consortium of 24 Banks (of which Appellant-IDBI Bank Limited is the lead Bank). Lanco Infratech Ltd., ICICI and Senior Lenders also became signatories to the Master Restructuring Agreement. An Indenture of Mortgage dtd. 1/12/2014 was executed between LDHL, Lanco Infratech and IDBI, under which various properties were mortgaged by LDHL in favour of IDBI. On the same day, a charge was registered with the Registrar of Companies for an amount of INR 111.55 crore. On 16/12/2015, LDHL executed Deed of Hypothecation in favour of ICICI as security interest under the Rupee Facility Agreement, ranking subservient to the security interest created in favour of Senior Lenders. On 3/8/2017, ICICI issued a notice recalling the financial assistance granted to LDHL under the Rupee Facility Agreement. In August 2018, SBI issued an advertisement as the lender's agent proposing to substitute LDHL with a suitable Selectee in terms of the Substitution Agreement and solicited bids from the prospective bidders for handing over the rights and obligations of the concessionaire under the Concession Agreement for residual period of the concession. According to ICICI, the bid document expressly recorded ICICI's outstanding debt.

(3.) ICICI was apparently opposed to appointment of new Selectee and filed Commercial Suit No.1447 of 2018 before this Court seeking injunction against Senior Lenders from replacing LDHL under the Concession Agreement without the prior consent of ICICI. On 31/10/2018, an interim order was passed in the Suit directing that NHAI would not grant approval to the Agreement executed by and between the Defendants and the new Concessionaires. It appears that consent terms were filed in the Suit, under which the parties inter alia agreed new concessionaire and NHAI shall execute all intermediate documents and that new Concessionaire would deposit consideration of INR 385.90 crore in the Court. The consent order recorded that the issue as to manner of distribution of the amount paid with the Court shall be determined in the Notice of Motion filed by ICICI. In the above background, SBI issued letter dtd. 22/5/2019 to IDBI intimating the status of the suit and requesting IDBI to file intervention application in the Suit. On 9/10/2019, IDBI filed Intervention Application in the Suit. The said Application however remained pending. On 13/1/2021, an order was passed in the suit urging the parties to settle the disputes with regard to distribution of the deposited amount by the new Concessionaire. While the settlement discussions were at advanced stage, IDBI pressed its Impleadment Application, which came to be rejected by order dtd. 20/12/2021. After IDBI was denied opportunity to intervene the suit filed by ICICI, the present suit (Commercial Suit (L) No.2100 of 2022) was filed by IDBI seeking a declaration of its security interest being superior to ICICI's security interest. IDBI filed Interim Application (L) No.2102 of 2022 seeking interim injunction restraining release of funds to ICICI Bank and SBI during pendency of the suit. On 27/4/2022, this Court allowed the Senior Lenders to withdraw the undisputed principal amount. This left only the residual amount, on which IDBI as well as ICICI was staking claims. By the impugned judgment and order dtd. 29/9/2022, the learned Single Judge has proceeded to dismiss IDBI's Interim Application for temporary injunction. Aggrieved by the judgment and order dtd. 29/9/2022, the present Appeal has been filed.