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2023 Supreme(Del) 2330

IN THE HIGH COURT OF DELHI AT NEW DELHI
YASHWANT VARMA, J.
Daiichi Sankyo Company Limited - Decree Holder
Versus
Malvinder Mohan Singh and Others - Judgment Debtor
O.M.P.(EFA)(COMM.) No. 6 of 2016, Ex. Appl.(OS) No. 3764 of 2022, Ex. Appl.(OS) No. 3850 of 2022, Ex. Appl.(OS) No. 317 of 2023, Ex. Appl.(OS) No. 318 of 2023 and O.M.P.(I) (COMM.) No. 206 of 2016
Decided On : 24-04-2023

Advocates Appeared:
Mr. Arvind Nigam, Mr. Arun Kathpalia, Sr. Advs. with Mr. Amit Kumar Mishra, Ms. Devna Arora, Ms. Samridhi Hota, Mr. Varad Choudhary, Ms. Gauri Goburdhun, Ms. Astha Ahuja, Ms. Diksha Gupta, Mr. Rohan Jaitley and Mr. Kunal Chatterji, Advs., Mr. Giriraj Subramanium, Mr. Simarpal Singh Sawhney, Mr. Siddharth Juyal and Ms. Urvashi, Advs., Mr. Aditya Dewan and Mr. Mr. Sahil Chandra, Mr. Devina Sehgal and Mr. Mohd. Ashaab, Advs., Mr. Ritin Rai, Sr. Adv. with Ms. Shally Bhasin, Mr. Chaitanya Safaya, Mr. Prateek Yadav, Ms. Gunjan Mathur, Advs., Mr. Sanjiv Kakra, Sr. Adv. with Ms. Shally Bhasin, Mr. Chaitanya Safaya, Mr. Prateek Yadav and Mr. Akash Madan, Advs., Mr. Aashish Gupta, Ms. Sadhika Gulati, Advs., Ms. Aditi Mohan and Ms. Sakshi Sharma, Advs., Mr. Ashish Dholakia, Sr. Adv. with Mr. Sandeep Das, Mr. Siddharth Sharma, Mr. Anandini Kumari and Mr. Peeyush Agarwal, Advs., Mr. Jayant Mehta, Sr. Adv. with Ms. Roopali Singh, Ms. Durga P., Ms. Sayobani Basu, Mr. Akash Ray, Advs., Mr. Gaurav Mitra, Mr. Atul Sharma, Mr. Aditya Vashisth, Mr. Ananad Sengar and Ms. Himanshi Rajput, Advs., Mr. Jayant Mehta, Sr. Adv. with Ms. Roopali Singh, Ms. Durga Priya, Ms. Sayobani Basu and Mr. Akash Ray, Advs., Mr. Sumit Goel, Ms. Sonali Gupta, Mr. Ishan Nagar, Advs., Mr. Rajiv Nayar, Mr. Abhinav Vasisht, Sr. Advs. with Mr. Sanjeev Sharma, Mr. H.S. Chandhioke, Mr. Vaibhav Kakkar, Mr. Sahil Arora, Mr. Saleem Hassan, Ms. Vaishali Goyal, Mr. Rohit Dahiya, Mr. Siddharth Jain, Mr. Hriday Kochhar, Ms. Sannya Sud, Ms. Akshita Sachdeva and Ms. M. Das Gupta, Advs., Mr. L.K. Giri, Adv., Mr. Arvind Nigam, Mr. Arun Kathpalia, Sr. Advs. with Mr. Amit Kumar Mishra, Ms. Devna Arora, Ms. Samridhi Hota, Mr. Varad Choudhary, Ms. Gauri Goburdhun, Ms. Astha Ahuja, Ms. Diksha Gupta, Mr. Rohan Jaitley and Mr. Kunal Chatterji, Advs., Ms. Aditi Mohan and Ms. Sakshi Sharma, Advs., Mr. Ateev Mathur, Mr. Tushar Sahu, Ms. Divya Rana, Advs., Mr. Aditya Dewan and Mr. Mr. Sahil Chandra, Advs.

Headnote:(A) SEBI Act, 1992 - Section 12A - Arbitration and Conciliation Act, 1996 - Section 48 - Enforcement of foreign arbitral award - The court held that directors of companies violated court orders by transferring shares to circumvent legal obligations, and contempt was established against them. The matter included the complexities of investment through inter-corporate deposits designed to benefit promoters while evading legal responsibilities. (Paras 20-30, 50-68)

(B) Contempt of Court - Definitions and obligations of parties - The court's injunctions against asset dilution were affirmed, leading to directors relinquishing shares to satisfy obligations under a foreign award. Directors were found to have willfully disobeyed legal orders, warranting penalties and monetary fines. (Paras 31-44)

Table of Content
1. background details of judgments and orders. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8)
2. court's view on compliance and contempt findings. (Para 10 , 11 , 13 , 38 , 39 , 40 , 41 , 42 , 43 , 44)
3. claims about rights by fhsl and ihfl. (Para 17 , 18 , 19 , 20)
4. misrepresentation and fraudulent transactions addressed. (Para 45 , 46 , 47 , 48 , 49 , 50 , 51 , 52)
5. court's order for releasing funds. (Para 78 , 79)

ORDER :

Yashwant Varma, J.

EX. APPL.(OS) 3651/2022 in O.M.P.(EFA)(COMM.) 6/2016

1. The instant application has been moved by the execution petitioner for being accorded permission to withdraw the amount of INR 20,54,65,962.22 transmitted to the Registrar General of this Court pursuant to the order of 22 September 2022 passed by the Supreme Court in Contempt Petition (C) No. 2120 of 2018, Special Leave Petition (C) No. 20417 of 2017 and Suo Motu Contempt Petition (C) No. 4 of 2019 titled Daiichi Sankyo Company Limited v. Oscar Investments Limited , 2022 SCC OnLine SC 1281 .

2. For the purposes of clarity and completeness of the record, the directions as framed in the aforenoted order are extracted hereinbelow:—

    “30. In the premises we pass following directions:

    (a) Contemnor Nos. 9 and 10 are sentenced to suffer six months imprisonment and pay fine in the sum of Rs.5,000/- each within four weeks from today. In case of default of payment of fine, the contemnors shall undergo further imprisonment of two months.

    (b) Special Leave Petition (Civil) No. 20417 of 2017, Contempt Petition No. 2120 of 2018 in SLP (C) No. 20417 of 2017 and Suo Motu Contempt Petition (C) No. 4 of 2019 are disposed of with a direction to the High Court, before whom the proceedings in execution are pending, to consider appointment of forensic auditor(s) to analyse the transactions entered into by the noticee banks and financial institutions and to look into whether such transactions were bona fide and entered into in commercial expediency.

    (c) The executing court may also consider issuing appropriate process and appointing forensic auditor(s) to analyse the transactions entered into between FHL and RHT and other related transactions.

    (d) The amount of Rs.17,93,40,000/- which stands deposited in the Registry of this Court shall be transmitted to the executing court along with interest accrued thereon. The said amount shall be available to the executing court while considering execution of the instant foreign arbitral award.

    (e) Certain shares which are still lying with the noticee banks and financial institutions, for example, the shares of FHL pledged with and continued to be held by RBL Bank which were dealt with in the order dated 15.04.2021. passed by this Court, shall be available to the executing court and shall abide by such order as the executing court may deem appropriate to pass.

    (f) All the properties offered by Contemnor Nos. 9 and 10 in their attempt to partially purge themselves of contempt shall also be available to the executing court and shall abide by such directions as the executing court may deem appropriate to pass. Consequently, there shall be attachment of all those assets which may await the decision or direction to be passed by the executing court in due course of time which may also include the questions whether the assets in question apparently in the names of certain persons/entities can be proceeded against.

    (g) Needless to say that it shall be open to the executing court to pass such directions as the facts and circumstances presented before it may justify.

    (h) All pending proceedings before the concerned courts, including the First Information Reports and proceedings before NCLT shall be taken to logical conclusion in accordance with law.

    (i) The Registry shall send copies of all volumes, submissions and pleadings filed by the parties in the instant matters to the executing court for facility and record.

3. The funds wh

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