The Bombay High Court has not given any respite to the companies of Anil Ambani-led Reliance Group, which had sought compensation, alleging misconduct in sale of their pledged shares by Edelweiss group companies, according to Business Standard.
The high court not only refused to grant an interim relief but also described the group’s stand as deceitful and misleading. The court is yet to give its final judgment and has deemed its views as “prima facie”.
On the Anil Ambani group companies’ argument that they had not been given adequate notice before the pledged shares were sold, the court observed: “It is rather strange that such an argument is made by plaintiffs.
When the contract was entered into, plaintiffs found one business day notice to be reasonable…
Therefore, stand of plaintiffs’ smacks of deceit. Plaintiffs attempt is to mislead. At no point after the occurrence of events of default, did plaintiffs … ask for increasing the notice period,” the court said.
The court further said, “Plaintiffs don’t pay default interest, don’t top up the security ratio, don’t even tell defendants how they are going to make good, don’t even reply to letters from plaintiffs and now take a mendacious stand that notice period in the contract was not reasonable.”
The court also said there was no case of “fiduciary obligations” being breached by Edelweiss group companies in selling pledged shares.
The court asked the Reliance group companies’ counsel Aspi Chinoy, “… what is the breach of contract or which are the provisions of the agreements that plaintiffs are alleging defendants committed to breach.”
“I find nothing wrong in what defendants did,” Justice KR Shriram, who presided over the proceedings, said.
Denying any interim relief to Reliance group companies, Justice KR Shriram said, “… defendants cannot be stopped from exercising their rights under the contract and applicable law.”
