- (1.) This is an application preferred by the Respondent No. 5-Dalmia Cement (Bharat) Ltd. (hereinafter 'Applicant') with a prayer to modify an interim order of this Court dated 27.08.2019 (hereinafter 'Interim Order') passed in Civil Appeal Nos. 5395-5398 of 2019 (hereinafter 'Accompanying Appeal'). Further, to that effect, direct the Respondent No. 7-National Securities Depository Limited (hereinafter 'NSDL') to release/transfer Mutual Fund units in favour of Respondent No. 5- herein, by crediting the same in their demat account maintained by NSDL.
(2.) For ready reference, the Interim Order dated 27.08.2019 is extracted below: "Permission to file appeal is granted. We have heard learned counsel for the parties and in view of the urgency and consequences explained, we are inclined to pass the following interim directions: 1. The National Security Clearing Corporation Limited will honour F and O Segment contract which had matured on 27th June, 2019 and has not been paid in view of the interim order passed by this Court on 26th June, 2019 in I.A. No. 91268/2019 in Civil Appeal No. 5104-5105/2019. The interim order is vacated, clarifying that the payments would be without prejudice to the rights and contentions of all the parties and subject to the final outcome and directions that this Court would pass. 2. Option is given to Novjoy Emporium Private Limited, OCL India Limited and Dalmia Cement East Limited to ask for conversion/sale/encashment of the mutual funds which were purportedly furnished as a security by Allied Financial Services Private Limited. Similar option is also given to 44 parties who had preferred Appeal No. 257/2019 before the Securities Appellate Tribunal, Mumbai. 3. On the option being exercised, IL and FS Securities Services Limited shall convert/encash the mutual funds, and the amount realised would be deposited in a fixed deposit in a Nationalised Bank for a period of six months to earn maximum interest. The deposit would be in the name of IL and FS Securities Services Limited and abide by further orders/directions of this Court. 4. The question of jurisdiction of Securities and Exchange Board of India, Securities Appellate Tribunal and the plea of IL and FS Securities Services Limited relying upon clause (5) of Chapter VII of the Bye-Laws framed by the National Security Clearing Corporation Limited are left open and would be decided at the time of final hearing. List the matters after four weeks." I. Respondent No.5-Applicant's Submissions:
(3.) Certain facts pertaining to the Applicant's submissions are outlined in brief below: i. Mutual fund units worth INR 344.07 crores belonging to the Applicant (hereinafter 'Mutual Fund units') were lying in two demat accounts of OCL India Limited (hereinafter 'OCL') and Dalmia Cement East Limited (hereinafter 'DCEL') which were erstwhile subsidiaries of the Applicant and have now merged with it. The said demat accounts were opened with NSDL through its participant, Respondent No. 4-Allied Financial Services Private Limited (hereinafter 'Allied'). ii. The Applicant states that the demat accounts were not trading accounts and that no power of attorney or authorization was given by the Applicant to Allied to deal with the Mutual Fund units in any manner whatsoever. The Mutual Fund units were not in physical form but in digitalized form, kept in the demat account of the Applicant. iii. The Applicant alleges that Allied had fraudulently and unauthorizedly placed the Applicant's Mutual Fund units as security with Respondent No.1-IL and FS Securities Services Ltd. and Ors. (hereinafter 'ISSL') as collateral for Allied's own transaction, i.e., margin obligations. iv. Aggrieved by the alleged fraudulent activities of Allied, the Applicant lodged a complaint dated 8.02.2019 with Respondent No. 1-Securities and Exchange Board of India (hereinafter 'SEBI ') and a complaint dated 15.02.2019 with the Economic Offences Wing, Delhi Police (hereinafter 'EOW') against Allied, ISSL, NSDL and their officials. v. On 9.12.2019, i.e., subsequent to the passing of the Interim Order by this Court, SEBI issued a show cause notice to ISSL wherein it has observed that ISSL had allegedly facilitated Allied in executing the fraudulent transfer of Mutual Fund units from the accounts of inter alia DCEL and OCL. The Applicant alleges that the show cause notice evidences ISSL's "active participation" in the fraud committed by Allied. vi. On 12.11.2019, EOW filed a charge-sheet against inter alia ISSL and Allied under Sections 406/420/467/468/471/120B/34 IPC in the court of the Learned Chief Metropolitan Magistrate, Karkardooma (East), Delhi (hereinafter 'Trial Court'). As per the findings in the abovementioned charge-sheet, Allied and ISSL allegedly colluded with each other and fraudulently transferred the Mutual Fund units from the demat accounts of OCL and DCEL to their own accounts and related entities by forging the signatures of the authorized signatories of OCL and DCEL on 66Delivery Instruction Slips. vii. On 13.12.2019, the Trial Court took cognizance against inter alia Allied and ISSL and issued summons. Thereafter, the Applicant herein preferred an application under Section 457/451 of the Code of Criminal Procedure, 1973 (hereinafter 'CrPC') before the Trial Court seeking release of possession of stolen Mutual Fund units on superdari as its rightful owner during pendency of the trial. However, ISSL filed objections to the said application contending that the said application was not maintainable in light of the Interim Order passed by this Court. After hearing the parties, vide order dated 25.08.2020, the Trial Court dismissed the application filed under Section 457/451 CrPC. Hence, the Applicant has approached this Court with the present Application. ;