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2023 Supreme(Del) 1309
IN THE HIGH COURT OF DELHI AT NEW DELHI
Prathiba M. Singh, J.
Shri Pratap Raj Pandey & Ors. – Appellants
Versus
Investor Education And Protection Fund Authority & Anr. – Respondents
W.P.(C) 3326 of 2020
Decided On : 19-04-2023
Mr. Fanish K Jain, Mr. Ankit Garg, Mr. Nischay Ahuja, Mr. Manak Goel and Mr. Rohit Yadav, Advocates, for the Petitioners.
Ms. Shiva Lakshmi, CGSC with Ms. Srishti Rawat, Advocate, for the Respondents.
Recognition of a foreign decree and the rights of the petitioners in shares held in India based on the decree passed by the Kathmandu District Court, Nepal.
Headnote:
Foreign Decree - Recognition of Rights - Section 44A of the Civil Procedure Code, 1908 - Section 3(2) of the Diplomatic and Consular Officers (Oaths and Fees) Act, 1948 - The judgment discusses the recognition of a foreign decree and the rights of the petitioners in shares held in India based on a decree passed by the Kathmandu District Court, Nepal. The court held that the certified copy of the decree, duly attested by the Indian Embassy in Nepal, should be recognized as pronounced by a Court of competent jurisdiction. The court also emphasized that the question of reciprocating or non-reciprocating territory applies only when seeking execution of foreign judgments, and in this case, the document is produced for recognition of the petitioners' rights in the shares.
Fact of the Case:
The petitioners, Nepalese citizens, sought recognition of their rights in shares held in India based on a decree passed by the Kathmandu District Court, Nepal, following the demise of their parents. The shares were locked and held by the Investor Education and Protection Fund Authority, and the petitioners' applications for transfer were rejected based on the argument that the Nepalese decree was not directly executable in India.
Finding of the Court:
The court set aside the impugned order and directed the respondent to refund the shares to the petitioners, recognizing their equal entitlement to the shares based on the decree of the Kathmandu District Court, Nepal. The court emphasized that the certified copy of the foreign decree, attested by the Indian Embassy in Nepal, should be recognized as pronounced by a Court of competent jurisdiction.
Issues: Recognition of foreign decree, applicability of Section 44A of the Civil Procedure Code, 1908, and the rights of the petitioners in shares held in India.
Ratio Decidendi: The certified copy of a foreign judgment, duly attested by the Indian Embassy in the foreign country, should be presumed to be pronounced by a Court of competent jurisdiction. The question of reciprocating or non-reciprocating territory applies only when seeking execution of foreign judgments, and not for recognition of rights in shares.
Final Decision: The impugned order was set aside, and the respondent was directed to refund the shares to the petitioners in terms of their applications. The transfer was to be made within four weeks. The petition was disposed of with no order as to costs.
Prathiba M. Singh, J.(Oral)
1. This hearing has been done through hybrid mode.
2. The present petition has been filed by three brothers i.e. Shri Pratap Raj Pandey, Shri Prabhat Raj Pandey and Shri Pradip Raj Pandey all sons of late Shri. Piyush Raj Sharma Pandey and late Mrs. Prem Kumari Pandey. The Petitioners are Nepalese citizens. The parents of the Petitioners, who were also Nepalese citizens had purchased a total of 2182 shares of M/s Ultratech Cement Ltd.
3. After the demise of the parents, a case for partition of the properties of the parents was filed in 2017 before the District Court, Kathmandu, Nepal. A decree of compromise was passed by the said court dated 11th May 2017 as per which the shares were to be divided equally between the brothers. The relevant clause of the said deed of compromise is set out below:
"The plaintiff and defendant ourselves, in spite of our litigation against each other, have made a mutual understanding at home to settle our dispute by compromising the case and the content of the compromise is that; the shares of different companies registered in the name of late father Mr. Piyush Raj Pandey and late mother Mrs. Prem Kumari Pandey in India, which are due for distribution under `Partition of Property', are our ancestral property and three brothers do have equal rights over them so that we have agreed to compromise the case upon dividing entire above stated shares registered in the name of late father Mr. Piyush Raj Pandey and late mother Mrs. Prem Kumari Pandey in India and bonus and other benefits thereof into three equal halves as mentioned in the particular and transfer each stake into the name of the plaintiffs and defendant accordingly with equal entitlement according to this deed of compromise so that we came with this joint application pursuant to Clause 182 of "Of Court Arrangement". Hence, let execute the deed of compromise in the said terms upon clearing the hearing date by today. By saying so we have prepared and typed this deed of compromise pursuant to joint application and affixed thumb impression and signature thereof at our free will and submitted to Kathmandu District Court."
4. Certified copy of the said decision was also verified and legalized by the Indian Embassy in Kathmandu. In the meantime, due to non-claiming of the dividends by the parents for a period of more than seven years, the shares were locked and now lie in the custody of the Respondent i.e. Investor Education and Protection Fund Authority.
5. On the strength of the compromise decree passed by the District Court, Kathmandu, the Petitioners filed three applications before the Respondent-Authority seeking transfer of the shares in their respective names. However, the same was not considered by the Respondent-Authority leading to the filing of Writ Petition (Civil) No. 680/2020 titled `Pratap Raj Pandey & Ors v. Investor Education and Protection Fund Authority & ANR.'
6. In the said writ petition, vide order dated 20th January, 2020 the Court directed that the application of the Petitioners ought to be decided within four weeks. The operative portion of the said order is set out below.
2. It is the case of the petitioners that the parents of the petitioners, who were citizen of Nepal, had purchased the shares in various companies in India including those of M/s Ultratech Cement Ltd. A case of seeking partition of the properties of the parents of the petitioners was filed before the District Court, Kathmandu, Nepal, where, based on a settlement, a decree dated 11.05.2017 has been passed. The petitioners have thereafter applied for transmission of the shares held by the parents of the petitioners and except for the shares in M/s Ultratech Cement Ltd., all other shares have been transmitted to the petitioners. It is further stated that even for the shares of M/s Ultratech Cement Ltd., M/s Karvy Computershare Pvt. Ltd., being the Registrar have approved the transmission of such shares to the petitio
