The judgment emphasizes the importance of compliance with CDR provisions and the need to establish a prima facie case for the grant of interim orders.

Manmohan Singh, J.

1. Urgent matter is received at 4.00 p.m.

2. The three Plaintiffs, namely, GTL Limited, Chennai Network Infrastructure Limited and GTL Infrastructure Limited, have filed the present suit for declaration and permanent injunction against the Defendants, namely, IFCI Limited and IFCI Financial Services Limited, seeking the following prayers:

a) This Hon'ble Court be pleased to declare that the said Notice dated 8th September, 2011 sent by Defendant No. 1 to Plaintiff No. 1 and 2 being contrary to and in violation of the provisions specified in Annex 4 of the CDR Master Circulate dated 1st July, 2011 issued by the Reserve Bank of India, Inter-Creditor Agreement, the Debtor Creditor Agreement and the same be declared as illegal, null and void;

b) This Hon'ble Court be pleased to pass a decree for permanent injunction against Defendant No. 1 restraining it from and selling the Pledged Shares during the operation of standstill as per the provisions of the CDR Master Circular dated 1st July, 2011 read with the Inter-Creditor Agreement and the Debtor Creditor Agreement;

c) The suit be decreed with exemplary costs; and

d) such further and other relief as the circumstances of the case may require as this Hon'ble Court may deem fit and proper.

3. Along with the suit, the Plaintiffs have also filed the interim application under Order XXXIX, Rules 1 & 2 read with Section 151 Code of Civil Procedure being I.A. No. 14802/2011, seeking immediate interim order to stay the implementation, operation and effect of notice dated 08.09.2011 and also from selling, transferring, alienating, parting with any of the shares pledged with them by the Plaintiff No. 1's company.

4. It is pertinent to mention here that prior to the above-mentioned suit, Plaintiff No. 1 filed the suit for declaration and permanent injunction being CS(OS) No. 1771/2011 against Defendants No. 1 & 2 herein as well as Plaintiffs No. 2 & 3 impleaded here who were made parties as Defendants No. 3 & 4 in that suit as proforma Defendants. In the said suit, in one of the prayers, the said Plaintiff No. 1 sought the relief (h) that "pending the final decision of the Empowerment Group in relation to the proposed Corporate Debt Restructuring Scheme, the Defendants be restrained by an order and injunction of this Hon'ble Court from, in any manner, directly or indirectly, dealing with, disposing of, selling, offering for sale, appropriating or causing to be appropriated, causing to be offered for sale, creating or causing to be created any third party rights of whatsoever nature in the suit shares and/or the balance pledged shares or any part thereof." In the earlier suit, the prayer was also sought against Defendants No. 1 & 2, their agents, servants or any other person claiming through or under them to restrain perpetually by an order and injunction, in any manner, directly or indirectly, from dealing with, disposing of, selling, offering for sale, causing to be offered for sale of the suit shares.

5. One of the arguments in the earlier suit was that the present Plaintiffs were in advance stage of referring the matter for Corporate Debt Restructuring with the ultimate objective of securing the interests of their shareholders and lenders, including Defendant No. 1 and there was a meeting of the Board of Directors on 21.07.2011 for referring the matter to the CDR Cell. The Empowered Group of CDR was likely to hear the matter and give its approval for admission to CDR before the end of that month. It was argued that once the CDR process is commenced, as per the Regulation of Reserve Bank of India and the Debtor Creditor Agreement, there would be a standstill period of 90 days during which time the present Plaintiffs and the lending banks are barred from taking/continuing any legal action. It was alleged that Defendant No. 1 was aware that the said Scheme is at an advance stage to refer the matter to the CDR.

6. As Defendants No. 1 & 2 got the confidential information, they ha