Back
I. P. MUKERJI, ANIRUDDHA ROY
Manav Investment And Trading Company Limited – Appellant
Versus
Dbs Bank India Limited – Respondent
JUDGMENT
We do not want to keep this appeal pending. We have heard it out, dispensing with all formalities.
The appellant is the pledgor of shares of Birla Tyres Ltd. [BTL] today, worth about Rs.14 crores. These shares were pledged with the respondent bank to secure their loan from the bank.
By a notice dated 23rd February, 2022 the appellant was given time to pay Rs.15,87,50,000/- by noon of 16th March, 2022. In default, the respondent would proceed to sell the shares. By another notice of the same date the appellant was called upon to pay the entire outstanding amount of Rs.70,17,15,582.20 by noon of 16th March, 2022, failing which the remaining pledged shares would be sold.
The very short question which arises in this appeal is whether the notices of invocation of the pledge dated 23rd February, 2022 can be construed as reasonable notice to sell the pledged goods as provided in section 176 of the Indian Contract act, 1872 ?
Sections 176 and 177 of the said act enact as follows :
'176. Pawnee's right where pawnor makes default.-If the pawnor makes default in payment of the debt, or performance; at the stipulated time or the promise, in respect of which the goods were pledged, the pawne
The main legal point established in the judgment is the interpretation and application of sections 176 and 177 of the Indian Contract act, 1872 in the context of the sale of pledged shares and the ri....
24. Point of Law : One notice in contradistinction to giving a shorter period in another notice for shares of the same company that are pledged with the defendant does not stand to reason and is acco....
The judgment emphasizes the requirement of reasonable notice for the sale of pledged goods and highlights the impact of the Depositories Act on the rights of redemption against third parties.
under Section 176 of the Contract Act, the pawnor, if not otherwise liable for the debt as a borrower or as a guarantor or otherwise, does not merely from the act of making a pledge, become liable to....
A pledgee has the unfettered right to invoke the pledge and sell pledged shares upon default, governed by the Indian Contract Act, regardless of prevailing economic conditions.
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
