Page 14 - Banking Finance December 2017

LEGAL UPDATE

United Breweries' ac- Land Compensation increased by Apex Court
counts attached by SEBI The Apex Court has increase land compensation for some 300 landowners in
Haryana who will now get Rs. 45 lakh and Rs.
SEBI had recently ordered attachment 35 lakh per acre instead of Rs. 33 lakh and Rs.
of bank ac-
counts as well 18 lakh decided by the land acquisition officer.
In ruling of Bijender vs State of Haryana, the
as share and
mutual fund court applied the belting system in which the
land abutting the road was given the highest
holdings of de-
value and the plots behind were awarded pro-
faulter businessman Vijay Mallya-led
United Breweries (Holding) Ltd (UBHL) portionately less. Examining the sale deeds of adjacent lands determined the
to recover dues totaling Rs. 18.5 lakh. correct market value of the land acquired. Finally the Supreme Court had al-
lowed the appeal of the landowners for higher compensation.
The decision has been taken after
UBHL failed to pay the fine imposed
on it. In 2015, SEBI had levied a fine Tribunal free to follow own rules
of Rs15 lakh on the company for dis- The Supreme Court recently stated in the case of International Asset Reconstruc-
closure lapses regarding creation and tion Co vs Official Liquidator of Aldrich
invocation of certain pledge transac- Pharma and others, that the Tribunal is not
tions in shares of United Spirits. The limited by the rules of the Code of Civil Pro-
pending dues-totaling Rs. 18.5 lakh- cedure and can devise its own procedure.
include the initial fine of Rs15 lakh The matter was in relation to the time limit
and interest of Rs3.5 lakh and a re- for moving an appeal to the debt recovery
covery cost of Rs. 1, 000. tribunal which is different from the period
In an attachment notice dated 13 set in the Limitation Act.
November, SEBI asked banks, deposi- The Recovery of Debts and Bankruptcy Act allows only 30 days while the Limita-
tories and mutual funds not to allow
tion Act condones a delay of 45 days and more, if sufficient reasons are given.
any debit from the accounts of The judgment stated that the RDB Act was enacted to facilitate and expedite
UBHL. However, credits have been recovery of debts due to banks and financial institutions by summary proceed-
permitted. Further, SEBI has directed
the banks to attach all accounts, in- ings before a statutory tribunal. Moreover, a tribunal is not a court though it
cluding lockers, held by the defaulter. has the trappings of a court.
"There is sufficient reason to believe
that the defaulter may dispose of the Trademark misuse led to compensation
amounts in the bank accounts and se- While deciding on case of Orient Ceramics & Industries Ltd vs Square Ceramic
curities in the demat accounts held Ltd., the Delhi High Court stated that the con-
with your bank, depository, mutual duct of Square Ceramics was "deplorable" and
fund, and realisation of amount due indicated "a tendency to indulge in illegal ac-
under the certificate would in conse- tivities and to obtain wrongful advantage"for
quence be delayed or obstructed," violation of trademark.
SEBI said.
The trademark in dispute was 'Orient' for ce-
Mallya held 7.91% stake in UBHL in ramic and vitrified tiles sold throughout the country. The rival firm incorporated
his personal capacity as of December
2016 while the total promoter hold- in Gujarat used the name 'Oriento' for the same products such as tiles which
ing through various entities stands at was allegedly similar to that of Orient Ceramics.
52.34%, according to the latest BSE It was mentioned that the play of words and the design and colors used in pub-
data. He has been in the UK since he licity materials would mislead consumers. The Gujarat firm was imposed a com-
left India on 2 March 2016. pensation of Rs. 10 lakhs for violation of trademark.

14 | 2017 | DECEMBER | BANKING FINANCE

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