OJA/24/2008 1/5 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD O.J.APPEAL No. 24 of 2008 In COMPANY PETITION No. 142 of 2006 In COMPANY APPLICATION No. 266 of 2004 With CIVIL APPLICATION No. 38 of 2008 In O.J.APPEAL No. 24 of 2008 In COMPANY PETITION No. 142 of 2006 In COMPANY APPLICATION No. 266 of 2004 For Approval and Signature: HONOURABLE MS. JUSTICE R.M.DOSHIT HONOURABLE MR.JUSTICE K.M.THAKER ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================================= ASSET RECONSTRUCTION COMPANY (INDIA) LTD. - Appellant(s) Versus AKAR LAMINATORS LTD. - Opponent(s) ========================================================= Appearance : MR MIHIR THAKORE SENIOR ADVOCATE WITH MR DARSHAN M PARIKH for Appellant(s) : 1, MR SN SOPARKAR SENIOR ADVOCATE WITH MRS SWATI SOPARKAR for Opponent(s) : 1, ========================================================= OJA/24/2008 2/5 JUDGMENT CORAM : HONOURABLE MS. JUSTICE R.M.DOSHIT and HONOURABLE MR.JUSTICE K.M.THAKER Date : 12/03/2008 ORAL JUDGMENT (Per : HONOURABLE MS. JUSTICE R.M.DOSHIT) This Appeal is preferred against the order dated 11th March, 2008 made by the learned Company Judge ordering the appellant to hand over the possession of the assets of the respondent company which the appellant has taken over on 11th March, 2008 in exercise of powers vested into it under Section 13(4) of the SARFAESI Act. The learned Company Judge was of the opinion that the action taken on 11th March, 2008 by the appellant pending the hearing of the company petition was highhanded. Mr. Thakore has appeared for the appellant. He has submitted that the respondent had submitted a scheme for restructuring which is subject matter of consideration before the learned Company Judge in OJA/24/2008 3/5 JUDGMENT above company petition No.142 of 2006. The appellant is 80% secured creditor of the respondent. Under the promise extended by the respondent on 24th February, 2006, the appellant did not object to the scheme proposed by the respondent company. However, in view of the subsequent conduct of the respondent and its inability to act according to the promise extended by it, the scheme proposed by the respondent could not have gone through. In the circumstances, the action of the appellant in exercising its power to recover the possession of the assets of the company was absolutely within the statutory powers vested in it. The action could not have been set at naught by the learned Company Judge. Mr. Thakore has submitted that one of the units of the respondent company is closed and is under the seal of employees' provident fund authority. The another unit at plot No.B-73 is not a running factory. Mr. Soparkar has contested the Appeal. He has submitted that the factory at plot No.B-73 is a OJA/24/2008 4/5 JUDGMENT running factory and manufacturing activity is going on. He has submitted that as the matter was at large before the learned Company Judge, the appellant ought not have to taken over the possession of the running factory of the respondent. The learned Company Judge has rightly directed the appellant to hand over the possession of the assets of the company to the respondent. We are informed at the Bar that the matter will come up for hearing before the Company Court on 13th March, 2008. We do believe that when the matter is at large before the learned Company Judge, the appellant could have stayed its hands until further order is made by the learned Company Judge. No case for interference is made out. The Appeal is dismissed. Civil Application No.38 of 2008 stands disposed of. (Ms. R.M.Doshit, J.) (K.M.Thaker, J.) OJA/24/2008 5/5 JUDGMENT kdc