M/S Punjab And Sind Bank v. The Official Liquidator

Company Application No.232 of 2019 in M.SUNDAR, J 'First Leasing Company of India Limited' [hereinafter 'said company' for the sake of brevity and clarity] is a company which has gone into liquidation in the aforementioned Company Petition namely, 'Company Petition No.255 of 2014' (hereinafter 'main CP' for the sake of brevity) which is at the instance of a petitioning creditor namely, ICICI Bank Limited.

2. Captioned application i.e., Company Application No.232 of 2019 has been taken out by another Bank namely, Punjab and Sind Bank, which is a creditor qua said company.

3. Applicant made a claim for a total sum of Rs.18,34,30,714/- (Rupees Eighteen Crores Thirty Four Lakhs Thirty Thousand Seven Hundred and Fourteen Only) and after adjudication, 'Official Liquidator attached to this Court' [hereinafter 'OL' for the sake of brevity] admitted the principal sum of Rs.15,00,00,000/- (Rupees Fifteen Crores Only). It is not necessary to delineate any further on facts in this regard owing to the scope of 1/4

captioned application. Captioned application is with the prayer to treat the applicant as a secured creditor under Section 529A of 'The Companies Act, 1956' [hereinafter 'said Act' for the sake of brevity].

4. In response to the captioned application, OL has filed a 'report dated 26.08.2019' [hereinafter 'said report' for the sake of brevity]. To be noted, the said report is a common report in support of captioned application and another application namely, Company Application No.231 of 2019, but what is of relevance is, it has been averred in the said report that the claim of the applicant Bank is for investment made in unsecured redeemable nonconvertible subordinated debt in the nature of debentures and the applicant has not created or secured any charge with the Registrar of Companies. This factual averment made in the said report is not disputed by the applicant. It is for this reason set out / articulated in said report that OL submits that applicant cannot be treated as a secured creditor under Section 529A of the said Act.

5. In the light of the narrative thus far, owing to the aforementioned 2/4

undisputed factual position, which has been set out supra, this Court is convinced that in the facts and circumstances of the instant case, stated position of OL that the applicant cannot be treated as a secured creditor under Section 529A is correct.

6. Therefore, captioned application is dismissed. There shall be no order as to costs.

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