JCT case: Punjab and Haryana High Court orders status quo

Tribune News Service

Chandigarh, November 29

The Punjab and Haryana High Court has granted relief to ARCIL, a secured creditor, by ordering status quo in all respects. It had taken the possession of plot number A-32, Industrial Focal Point, Phase VIII, Mohali, under the SARFESI Act.

The property was sold through public auction for Rs 90.56 crore to successful bidder GRG Developers & Promoters LLP. A secured creditor is a lender, generally a bank, with the benefit of a security interest over some or all of the assets of the debtor.

Following the auction, the PSIEC raised the issue with regard to entitlement of 50 per cent of the sale consideration towards unearned increase as per terms of the lease deed executed on July 8, 1987, whereby the land was allotted to M/s JCT Electronics Ltd on a leasehold basis for 99 years.

While confirming the sale and subsequent transfer of title and possession in favour of auction purchaser, PSIEC also demanded enhanced land cost and transfer fees to be directly paid to it for getting NOC for the purpose of transfer.

Appearing on behalf of ARCIL before the Bench of Justice MS Ramachandra Rao and Justice Jasjit Singh Bedi, senior advocate Chetan Mittal with counsel VK Sachdeva and Mayank Agarwal pointed out that the PSIEC in one of the communications dated November 6, 2020, had stated that the matter had been considered and approval of the Punjab Government was conveyed for execution of a tripartite agreement. Thereafter, a tripartite agreement was executed on December 11, 2020.

The dispute arose after it was conveyed that the matter has been referred to the Finance Department in spite of exact calculation in December 2020 and part payment already being received from the auction purchaser by the PSIEC.

Mittal informed the court that the tripartite agreement, which was made for the facilitation of direct payment of unearned increase to the PSIEC, has been terminated through the impugned order on the directions of the Punjab Department of Finance. It was alleged that it amounted to illegality and was without jurisdiction. It was also overreaching the court especially on account of the previous matter being sub judice.