- (1.) The substituted petitioning creditor - Kaushik Shah Shares and Securities Private Limited - seeks an order adjudicating Debtor No. 2, an insolvent.
(2.) The substituted petitioning creditor's claim arises in the following manner. (A) The substituted petitioning creditor, in the year 2001, filed a reference for arbitration with the Bombay Stock Exchange in connection with its claim against Debtor Nos. 2, 3 and 4, Nirjay Securities Pvt. Ltd. and one Mayank. An award dated 29th July 2002 was made against Nirjay Securities Pvt. Ltd. for a sum of Rs. 2,19,75,396.70, interest and for costs. The claim against the others was rejected. The Appellate Bench of the Bombay Stock Exchange rejected the substituted petitioning creditor's appeal on 25th April, 2003. The substituted petitioning creditor challenged the award by filing Arbitration Petition No. 381 of 2003. By an order dated 4th April, 2005, for which the parties did not seek reasons, the award was set aside insofar as it rejected the claim against Debtor Nos. 2 to 4 and the said Mayank and the Arbitrators were directed to make a fresh award with respect to them. (B) On 19th April, 2006, the arbitrator made and published an award against Nirjay Securities Private Limited and Debtor No. 2 in the sum of Rs. 2,19,75,396.70 with interest at eighteen per cent per annum on Rs. 2,04,71,815.70, but rejected the reference against Debtor Nos. 3 and 4 and the said Mayank. The substituted petitioning creditor's appeal before the Appellate Bench of the Stock Exchange was dismissed on 26th September, 2006. The substituted petitioning creditor filed Arbitration Petition No. 167 of 2007, challenging the award of the Appellate Bench of the Stock Exchange insofar as it rejected the reference against Debtor Nos. 3,4 and the said Mayank. The petition is pending. (C) In the result, the award dated 19th April, 2006, as against Debtor No. 2 has become final. The substituted petitioning creditor is, therefore, a creditor qua Debtor No. 2 to the extent of the amounts awarded.
(3.) The facts leading to the original petitioning creditor filing the Insolvency petition are as follows. (A) On 31st July, 2006, one Mrs. Ritu Sethi obtained a decree against the debtors in Summary Suit No. 1595 of 2005. On 19th October, 2006, at the instance of Mrs. Ritu Sethi, Insolvency Notice No. N/268 of 2006 was served against the judgment debtors based on the decree dated 31st July, 2006. The insolvency notice was served upon the judgment debtors on 31st October, 2006. (B) The act of insolvency was complete on 5th December, 2006. (C) The original petitioning creditor Mrs. Neebha Kapoor, availing of the said act of insolvency referred to above, filed the above Insolvency petition on 12th January, 2007, in connection with her claim against the debtors. (D) By a letter dated 9th February, 2007, addressed to Mrs. Ritu Sethi, the debtor's Advocate admitted that a sum of Rs. 32,780/-was still payable and, accordingly, enclosed a pay order for the said sum towards satisfaction of the decree. (E) On 11th April, 2007, the judgment debtors filed Chamber Summons No. 583 of 2007 in the said Summary Suit No. 1595 of 2005 filed by the said Ritu Sethi seeking a declaration/ order to the effect that the decree stands fully satisfied. In the affidavit-in-reply dated 1st June, 2007, it was contended that an amount of Rs. 8,046/- was still due and payable under the decree. (F) This Chamber Summons was disposed of by an order dated 6.5.2009, the learned Judge recorded the statement on behalf of the plaintiff that she has received certain amounts and that the decree in two suits stood satisfied. It was however, clarified that the order would not influence the Court in the proceedings filed under section 138 of the Negotiable Instruments Act in any manner.;