JM FINACIAL RECONSTRUCTION CO LTD vs M/s. Concerin Virginia Chennai (P) Ltd on 7 October 2026

1. M/s Conceria Virginia Pvt Ltd

50, Raja Muthaiah Road, Periamet

Chennai – 600 003

2. Mr. Asgar Ali Dhala (since Deceased)

14, Sivaganga Road, Nungambakkam

Chennai – 600 034 2a. Mrs. Zubedia Asgar Ali Dhala No.19, Sivaganga Road, Nungambakkam Chennai – 600 034 2b. Ms. Atiya Fattima No. 19, Sivaganga Road, Nungambakkam Chennai–600 034

3. Mr. Muhammed Yavar Dhala

No.4, Casurina Drive, Sri Kapaleeswaran Nagar Neelangarai, Chennai 600 041

4. M/s Forward Leather Company

50, Raja Muthaiah Road, Periamet,

5. Forward Shoes (India) Pvt. Ltd.

50, Raja Muthaiah Road, Periamet,

Chennai – 600 003

…Certificate Debtors/Defendants

(Defendant 2a & 2b added as per order dated 07.07.2026 made in MA No. 74 of

Counsels on record / appeared:

Counsel for Petitioner : M/s R. Sugumaran Counsel for Respondents : M/s Namasivayam

ORDER IN MA 226/2026

1. The applicant financial institution filed MA No.226/2026, a petition praying to modify the order dated 29.05.2026 made in TA No.1545/2025 in terms of clause 5 to 7 of the Joint Memo of Compromise dated 09.02.2023.

2. It is the case of the petitioner that State Bank of India, the original lender had filed the following OA against the defendants herein for recovery of monies due as follows:

a) OA No.51 of 2022 (TA NO.1545 of 2025) against Conceria Virginia Chennai Private Limited and Ors for recovery of outstanding sum of Rs.7,89,50,010.64/- along with further interest costs and charges b) OA 66 of 2012 against the Forward Shoes India Pvt Ltd and Ors for recovery of outstanding sum of Rs.54,33,99,125.51p along with further interest, costs and charges.

c) OA 86 of 2012 against the Forward leather company and Ors for recovery of outstanding sum of Rs.27,71,09,115.77p along with further interest, costs and charges.

2. It is submitted that the financial assets of the defendants were assigned in favour of JM Financial Assets Reconstruction Company Limited vide Assignment Agreement dated 26.03.2014 under the provisions of the SARFAESI Act, pursuant to which the applicant herein was substituted in place of the original lender.

3. It is submitted that during the pendency of the OA, the applicant and the defendants along with the defendants in OA No.66 of 2012 and OA No.86 of 2012 jointly entered into Memorandum of understanding (MOU) dated 18.03.2015 to settle dues of the applicant in the manner and on the terms and conditions more particularly contained the MOU. It is submitted that a joint memo of compromise was signed and filed by all the parties and DRT-I vide its order dated 06.08.2015 in O.A. No. 51 of 2012, OA NO.66 of 2012 and OA.No. 86 of 2012 disposed of the original application by allowing memo of compromise. However, the terms of the memo of compromise read with the MOU have not been complied with the defendants and as a result, the said defendants are still liable to pay the outstanding dues to the applicant.

4. It is further submitted that the defendants vide E-mail dated 02.04.2025 had approached the applicant for settlement of the outstanding dues. Upon consideration, the applicant issued One Time Settlement letter dated 22.07.2025 agreeing to settle the dues under

OA.No.51 of 2012, OA NO.66 of 2012 and OA. No.86 of 2012 subject to strict compliance of the terms contained therein.

5. The defendants agreed to pay the applicant an agreed consideration of Rs.13,45,00,000/- (Rupees Thirteen Crores Forty Five Lakhs only) in full and final settlement of the dues covered under TA.No.1545 of 2025, OA NO.66 of 2012 and OA.No.86 of 2012 before this Hon’ble Tribunal.

6. Upon receipt of the entire agreed consideration in accordance with the above terms and such other terms and conditions as stipulated under the settlement letter dated 22.07.2025, the applicant agrees that the present proceedings may be treated as fully settled and disposed of

7. It is expressly agreed that in the event of default or non-compliance of any term of this compromise or the terms and conditions more particularly provided under the one time settlement letter dated 22.07.2025, the applicant shall be at liberty to revive the present proceeding seek issuance of a Debt Recovery Certificate and initiate recovery proceedings in accordance with law without prejudice to its right under the SARFAESI Act or any other applicable law.

8. Based on the above terms and other conditions the parties filed Joint Compromise Memo dated 09.02.2026 for withdrawal of the OA by incorporating the default clause in the event of the failure of the defendants to pay the aforesaid sum or non-compliance of the terms and conditions under the settlement letter dated 22.07.2025, the applicant shall be at liberty to proceed with OA.

9. The chamber order was passed on 29.05.2026 in and by which the TA was disposed off recording the compromise. However while disposing of the TA, it was observed that all the defendants have paid the sum of Rs.13.45 crores, which is not correct. The defendants promised to pay the said consideration. It is useful to extract Clauses 5 to 7 of the Joint Memo of compromise for proper and better appreciation of facts. Quote “5. The defendants agree to pay the applicant an agreed consideration of Rs.13,45,00,000/- in full and final settlement of the dues covered under the TA.No.1545 of 2015, OA NO.66 of 2012 and OA.No.86 of 2012 before this Hon’ble Tribunal.

6. Upon receipt of the entire agreed consideration in accordance with the above terms and such other terms and conditions as stipulated under the settlement letter dated 22.07.2025, the applicant agrees that the present proceedings may be treated as fully settled and disposed of.

7. It is expressly agreed that in the event of default or non- compliance of any of any term of this compromise or the terms and conditions more particularly provided under the one time settlement letter dated 22.07.2025, the applicant shall be at liberty to revive the present proceeding seek issuance of a Debt Recovery Certificate and initiate recovery proceedings in accordance with law without prejudice to its right under the SARFAESI Act or any other applicable law.”

10. The above clauses reveal that the defendants have not made the payment but agreed to make the payment. In the circumstances the order dated 29.05.2026 requires modification. Hence this MA.

Heard both sides and perused the records of the case.

11. The Assistant Registrar of this Tribunal vide proceedings dated 20.05.2026, had inadvertently recorded that the matter has been settled out of Court. The relevant proceedings is extracted as under: “Counsel for applicant bank present. Applicant bank has filed FS memo, joint memo refund of Court fee and Form 11 for return of documents. The matter has been settled for Rs.13,45,000/- under OTS. FS memo in order. Exhibits A1 to A70 are verified.

Applicant bank is entitled for refund of 25% of Court fee paid. Posted before Hon’ble PO on 29.05.2026 for further proceedings.”

12. Based on the above recording, this Tribunal vide proceedings dated 29.05.2026 recorded as under: “TA has been filed for recovery of Rs.7,89,50,01.64p/-. The applicant bank has filed a full satisfaction memo stating that the account has been settled out of court by One Time settlement and that the defendants have paid an amount of Rs.13,45,00,000/- towards one time settlement of TA claim and hence prayed to dispose the above Transfer Application as settled out of court. Further, joint memo has been filed for

Refund of Court Fee, which is verified by the Registrar Vide proceedings dated 20.05.2026, applicant bank is entitled to get of 25% of the court fee remitted in this case as per Rules. Full satisfaction memo along with joint memo filed by the applicant bank is taken on record. Accordingly, TA stands disposed of as settled between the parties. All the pending IAs stands closed. Registry is directed to refund the court fee as per procedure.

Registry is directed to return Ex.A-1 to A-70 to applicant bank under proper acknowledgement.”

12. Now the petitioner financial institution has filed MA No.226/26 praying to modify the order dated 29.05.2026, in terms of the clause 5 to 7 of the joint compromise memo.

13. Having regard to the circumstances of the case and upon consideration of the Joint Compromise Memo, this Tribunal is of the view that the prayer made in M.A. No. 226/2026 deserves to be allowed.

14. Accordingly, the proceedings dated 29.05.2026 is modified to the extent necessary to give effect to Clauses 5 to 7 of the Joint Compromise Memo and the following order is passed: “TA has been filed for recovery of Rs.7,89,50,01.64p/-. The applicant and the defendants have filed a Joint Compromise Memo dated 18.02.2026 stating that the defendants agree to pay the applicant an agreed consideration of Rs.13,45,00,000/- in full and final settlement of the dues covered under the TA.No.1545 of 2015, OA NO.66 of 2012 and OA.No.86 of 2012 before this Tribunal. Upon receipt of the entire agreed consideration in accordance with the above terms and such other terms and conditions as stipulated under the settlement letter dated 22.07.2025, the applicant agrees that the present proceedings may be treated as fully settled and disposed of. It is expressly agreed that in the event of default or non- compliance of any of any term of this compromise or the terms and conditions more particularly provided under the one time settlement letter dated 22.07.2025, the applicant shall be at liberty to revive the present proceeding seek issuance of a Debt Recovery Certificate and initiate recovery proceedings in accordance with law without prejudice to its right under the SARFAESI Act or any other applicable law.” The parties have prayed for disposal of TA in terms of compromise and also prayed for return of original title documents morefully detailed in the Form 11. Joint compromise Memo along with Form 11 has been verified by the Registry vide proceedings dated 20.05.2026. Joint Compromise Memo is taken on record. Accordingly, TA stands disposed of in terms of the Joint Compromise Memo dated 09.02.2026. Applicant bank will be at liberty to invoke default clause, in the event of non-compliance of the terms of compromise by the defendants, as agreed between the parties as per Clause 5 to 7. All the pending IAs stands closed. Registry is directed to return Ex.A-1 to A-70 to applicant under proper acknowledgement”

15. With the above observations, MA No.226/26 stands allowed. There shall be no order as to costs.

Sd/- (S.V. GOWRAMMA)

PRESIDING OFFICER, DRT-III, CHENNAI

(Dictated to PS, transcribed by her, corrected, signed and pronounced by me on this the 07th day of October, 2026)