Bombay HC clears decks for Swadeshi Mills land auction, revives end to proceedings

Winding up of the institution involves selling its assets, paying disconnected creditors and distributing remaining assets to shareholders.

A seat of Justices Mahesh S Sonak and Jitendra S Jain passed a judgement connected an entreaty by Bipin J Bagadia and  Ashish Jagmohan Mooni, 2 shareholders of Swadeshi Mills company, argued done advocator Mohit Khanna.

The petitioners had challenged the orders of October 9, 2023 and December 21, 2022 of the  HC that disposed of an exertion made by Grand View Estates Private Limited (a radical institution of Shapoorji Pallonji Group of Companies) nether conception 466 of Companies Act and had stayed the winding up proceedings

The existent property radical holds 52 per cent involvement successful Swadeshi Mills done its 2 subsidiaries Forbes and Co Ltd (22.72 per cent) and Grand View Estates (29.29 per cent).

When the winding up proceedings nether the HC’s September 2002 bid was successful progress, the 2 subsidiaries of the existent property radical had sought a enactment connected the same, which was rejected by a single-judge seat of the HC successful October 2011. In August 2013, a two-judge seat of the HC had dismissed an entreaty against the single-judge seat order. The Supreme Court successful February 2016 dismissed the peculiar permission petition against the HC orders, noting it did not find immoderate ineligible and valid grounds to interfere successful the same.

After 4 years, successful 2020 and aboriginal successful 2021, the Grand View Estates and Rashtriya Mill Mazdoor Sangh entered into an statement related to the colony of dues of the company’s erstwhile workers.

Grand View Estates past filed different interim exertion successful HC successful 2022, seeking a enactment connected the winding up proceedings. The HC granted enactment connected this and besides issued directions to administer funds to creditors of the Swadeshi Mills aft handing it implicit to Grand View Estates.

Aggrieved by the said October 9, 2023 order, the contiguous petitioners approached HC.

Appearing for the petitioners, advocator Khanna claimed the nonsubjective of the responsive subsidiaries of Shapoorji Pallonji was to get the company’s properties for existent property purposes without facing immoderate nationalist auction, done which the champion imaginable terms could person been realised for the payment of Swadeshi Mills’s shareholders.

Senior advocator Virag Tulzapurkar, representing Grand View, submitted that it had already deposited Rs 240 crore successful tribunal and the aforesaid had been disbursed to workers.

The seat noted that impugned orders of 2022 and 2023 deserved to beryllium acceptable speech “for nonaccomplishment to see captious material’ including the earlier HC orders of 2011, 2013 and SC bid of 2016.

It said that the magnitude to beryllium disbursed to workers was taxable to the last verdict successful the contiguous appeal, therefore, nary equities could beryllium claimed successful that regard.

The HC refused the petition to proceed the enactment connected winding up proceedings. It besides directed the 2 subsidiaries presently successful power of company’s affairs, to desist from sell, oregon conveyance of its immovable properties without court’s permission.