M/S. DAIICHI SANKYO COMPANY LIMITED versus OSCAR INVESTMENTS LIMITED & ORS. on 22 September 2022

1. The present proceedings arise out of an action initiated byDaiichi Sankyo Company Limited (hereinafter referred to as “Daiichi”)for enforcing a Foreign Arbitral Award dated 29.04.2016 made inSingapore and passed in favour of Daiichi and against 20 RespondentsDi.e. Respondent 1: Malvinder Mohan Singh, Respondent 2: MalvinderMohan Singh as Karta of HUF, Respondent No.3: Malvinder MohanSingh as Trustee of Bhai Hospital Trust, Respondent No.4: Japna M.Singh, Respondent 5: Nimrita Singh, Respondent 6: Shivinder MohanSingh, Respondent 7: Shivinder Mohan Singh as Karta of HUF,Respondent 8: Aditi Singh, Respondent 9: Anhad Parvinder Singh,ERespondent 10: Kabir Parvinder Singh, Respondent 11: Udayveer Singh,Respondent 12: Vivan Singh, Respondent 13: Nimmi Singh, Respondent14: Oscar Investments Ltd., Respondent 15: Malav Holdings Pvt. Ltd.,Respondent 16: Modland Wear Pvt. Ltd., Respondent 17: Fern HealthcarePvt. Ltd., Respondent 18: ANR Securities Pvt. Ltd., Respondent 19:FRHC Holdings Pvt. Ltd., Respondent 20: Oscar Traders (PartnershipFirm) (“Respondents/ Judgment Debtors”), directing them to jointly andseverally pay a sum of approximately INR 2562 crores with furtheradditional pre-award interest (4.44%) and post-award interest (5.33%),in Arbitration Case No.19074/CYK. The Award was challenged inSingapore as well as in India but the objections were dismissed and theGAward became final. In the proceedings initiated for enforcement ofsaid Award in the High Court[1], anobjection was raised under Section 48of the Arbitration and Conciliation Act, 1996 (for short, ‘the Act’).However, said objection was dismissed except insofar as originalrespondents No. 5 and 9 to 12, who were minors when the award wasH1High Court of Delhi at New Delhi.

declared. The further challenge in this Court to the rejection of theobjection did not succeed and Special Leave Petition (Civil) No. 4276 of2018 preferred therefrom was dismissed by this Court on 16.02.2018.

2. In the enforcement proceedings being OMP (EFA) (Comm.)No.6 of 2016 initiated by Daiichi, an apprehension was expressed thatthe Respondents were engaging in designs to move the assets outsidethe reach of Daiichi. It was submitted that Fortis Healthcare HoldingsPrivate Limited (“FHHPL”) was a holding company under the controlof the Respondents and the value of its shares was derived solely fromthe value of the downstream operating company- Fortis HealthcareLimited (“FHL”); and that FHL shares held by FHHPL were beingsold/ encumbered by the Respondents. In said proceedings, anundertaking given by the learned counsel appearing for respondentNos.14 and 19 was recorded by the High Court in its order dated21.06.2017 in following terms:

“8. Since the petitioner has raised an issue with regard to theshareholding of Fortis Healthcare Holding Pvt. Ltd. in FortisHealthcare Limited, the present order is being restricted to thevalue of the said unencumbered asset disclosed in the affidavit.

9. Learned Senior Counsel appearing for respondent no. 14 and19 submits that the value of the unencumbered asset comprisingof equity share in Fortis Healthcare Holding Private Limited hasbeen disclosed as Rs.452.60 Crores by respondent no.14 andRs.1889.30 crores by respondent no. 19.

10. Learned Senior Counsel appearing on behalf of respondentno. 14 and 19 undertakes that, irrespective of any transaction thatthe said respondent may enter into, the value as disclosed to thecourt would not be, in any manner, hampered or diminished.

11. The effect of the above statement of learned Senior Counselfor respondent no.14 and 19 is that the sum of Rs.2841.09 Crores(i.e. Rs.452.60 + Rs.1889.30 crores) would always be availableand realizable as an asset of respondent no.14 and 19, in FortisHealthcare Holding Pvt. Ltd. Towards the satisfaction of thedecretal amount as and when the stages so arises.

12. The statement is taken on record and the undertakingaccepted.”

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A3. In Special Leave Petition (Civil) No.20417 of 2017 theaforestated order dated 21.06.2017 is under challenge mainly on theground that rather than recording said undertaking of the learned counsel,the High Court ought to have issued appropriate process to secure theassets of those against whom the Award was passed. As a matter offact, the undertaking so recorded in the order dated 21.06.2017 was theBfifth assurance / undertaking given by the learned counsel appearing forrespondent Nos.14 and 19. Previous four such assurances were recordedby this Court in its judgment and order dated 15.11.2019[2 ]passed in VinayPrakash Singh vs. Sameer Gehlaut & Ors. as under:

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“Proceedings before the Delhi High Court C

The first assurance

4. During the enforcement proceedings, the petitioner filed I.A.No.6558 of 2016 before the High Court of Delhi praying that therespondents be restrained from alienating or encumbering theirassets. The petitioner expressed an apprehension that theDrespondents would fritter away their assets which would makethe award unenforceable. On 24.05.2016 Mr. Kapil Sibal, learnedsenior counsel appearing for the respondents assured the HighCourt that the interest of the petitioner will be protected. Thoughthis assurance was not recorded by the Court, the same forms aEpart of the letter sent by the counsel for petitioner, relevant portionof which reads as follows:- D

“1…Further, while directing that, inter alia, the ArbitrationAward dated 29 April 2016, be kept confidential, a formalprotective order has not been passed by the Hon’ble Court onthe strength of duly instructed oral assurance tendered byLearned Senior Counsel Mr. Kapil Sibal (appearing for theRespondents) that the Petitioner’s interest would be protectedto the extent of the total sum awarded under the Arbitral Awarddated 29 April 2016, and there would be no fait accompli. Mr.Kapil Sibal had also submitted that even recording of hispersonal statement in the order would affect the respondents’interest in the share market as some of his clients are listed instock exchange.”

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It appears that the respondents had urged before the Court thattheir assurance should not be recorded in the order of the Court, 2"The judgement”, for short.

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since that might affect the value of their shares in the share market.This was the first assurancegiven by the respondents to theHigh Court of Delhi. It would be pertinent to mention that the factthat such an assurance was made is also recorded in the order ofthe High Court dated 23.01.2017 wherein Mr. Harish N. Salve,learned senior counsel appearing for the respondents 1 to 4 and13 therein reiterated the assurance given to the Court as recordedin the letter dated 24.05.2016.

The second assurance

The second assurance

5. On 25.07.2016, the High Court of Delhi passed an order directingthe respondents to disclose the details of their immovable assetsand also to disclose the details of assets that have been alienatedand encumbered to third parties. It appears that during this periodreports appeared in various newspapers that the respondents weredisposing their stakes in subsidiary companies and were alsoclandestinely disposing of their assets. Left with no alternative,the petitioner filed an Interlocutory Application being I. A. No.618 of 2017 before the High Court of Delhi in which the followingprayer was made: - a. “Urgently pass an order directing the Respondents to securethe Award amount by depositing it with the Registrar of theDelhi High Court or by providing adequate security or by bankguarantee or by any other means that this Hon’ble Court maydeem fit;

b. Pass an order directing the attachment of the movable andimmovable assets and properties of the Respondents, and anyassets and properties in which the Respondents have anybeneficial interests until the disposal of the present petition, atleast to the extent of the amounts awarded in the Award;

c. Pass an order restraining the Respondents and their groupcompanies from selling, alienating or encumbering their movableor immovable properties/assets in any manner whatsoever;

d. Pass ex-parte, ad interim orders in terms of prayers (a), (b)and (c) above and confirm the same after notice to theRespondents;”

On 23.01.2017, Mr. Harish N. Salve, learned senior counsel forsome of the respondents before the High Court of Delhi reiteratedthe assurance given in the letter dated 24.05.2016 and sought two AB

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weeks’ time to furnish an affidavit by one of the respondentsgiving the details of assets of all the respondents. This was thesecond assurance.

The third assurance

6. The information was not provided in the manner sought by theHigh Court which is reflected in the order dated 06.03.2017. Theorder records that the respondents have been directed to furnishdetails of all unencumbered assets both movable and immovableand not merely the list of the investments, loans and advances asreflected in the affidavit filed by the respondents. The respondentswere directed to furnish further details and the counsel forrespondents had submitted that this would be done within 1 week.The High Court in its order dated 06.03.2017 clarified as follows:- “8. The Court would like to clarify that the above understandingby Respondent No.19 of what was required to be furnished interms of the order dated 23rd January 2017 is not correct. TheRespondents were in fact required to furnish the informationrelating to all the unencumbered assets, both moveable andimmovable, and not merely investments and loans andadvances.”

7. On 06.03.2017 Dr. Abhishek Manu Singhvi and Mr. Rajiv Nayar,learned senior counsel appearing for the respondents made astatement that the complete details/particulars of all unencumberedassets would be filed before the Registrar within one week.Certificates of Chartered Accountants of the respondents werealso directed to be filed giving the following details: -

(i) “the value of all the unencumbered assets, including bothmovable and immovable assets of Respondents 14 and 19, boththe book value as well as the fair value;

(ii) where these assets include investments in equity shares,preference shares and debentures, to indicate to what extentare these investments in related/group entities of theRespondents and in companies whose shares are listed andwhich of these shares have a condition of right of first refusal.

(iii) a clarification as to how much of the borrowings reflectedin the balance sheets are secured by way of pari passu chargeon the present and future current assets of the companies.”

The Court again noted the statement of Dr. A.M. Singhvi and Mr.Rajiv Nayar to the following effect: -

“12. Both Dr. Singhvi and Mr. Nayar state that if any changeis proposed in the status of any of the unencumbered assetswhose details are to be furnished as directed hereinbefore, theRespondents will first apply to the Court.”

This was the third assurance on behalf of the respondents.

The fourth assurance

8. OIL and RHC filed the certificates disclosing the value of theunencumbered assets and investments. On 28.02.2017 OIL hadunencumbered assets of a book value of 1953.70 crores and fairvalue of 1204.78 crores. The fair value of the unencumberedinvestments of OIL in listed entities including related/group entitieswas valued at 854.64 crores. As far as RHC is concerned, thebook value of the unencumbered assets was shown as 6,346.69crores and the fair value thereof at 3579.26 crores. The fair valueof unencumbered investments was shown as 3246.76 crores.Therefore, it was projected by the respondents that these twocompanies had a net value which was much more than the amountclaimed by the petitioner.

9. As pointed out earlier FHL is a Public Limited Company inwhich OIL and RHC held majority shares amounting to 52.20%through their wholly owned subsidiary, Fortis Healthcare HoldingsPrivate Limited (FHHPL) up till March, 2017. On 25.05.2017,FHL issued notice to its shareholders proposing that theshareholding of foreign investors would be increased. Immediately,thereafter, the petitioner filed I.A. No.7142 of 2017 before theHigh Court of Delhi praying that OIL and RHC be restrainedfrom reducing their 100% shareholding in FHHPL and be restrainedfrom indirectly transferring FHHPL shares in FHL. It was prayedthat these two companies be directed to maintain their holding of52% in FHHPL. In the meantime, the disclosures made by FHLto the Bombay Stock Exchange (BSE) showed that theshareholding of FHHPL in FHL had fallen to 45.7%.

10. On 19.06.2017 the High Court of Delhi recorded in its orderthat the learned senior counsel appearing for both OIL and RHC

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SUPREME COURT REPORTS

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Asubmitted that they are not seeking to change the status of anyunencumbered assets as disclosed to the Court and theshareholding as disclosed in terms of the order dated 06.03.2017shall not be affected. The statement was taken on record by theHigh Court and the application disposed of in terms of thisstatement. This effectively meant that the Court had restrainedBOIL and RHC from reducing their shareholding in FHL throughFHHPL in any manner. Relevant portion of the order passed bythe High Court of Delhi dated 19.06.2017 reads as follows: - “5. Learned Senior Counsel for respondent no.14 and 19 submitsthat they are not seeking to change the status of any unencumberedCasset as disclosed to the court and by mere passing of the impugnedresolution, the shareholding as disclosed, in terms of order dated06.03.2017, shall not be affected.

6. The statement is taken on record.

D7. In view of the above statement, the application is disposed of.”

This was the fourth assurancegiven by the respondents.”

4. While dealing with said Special Leave Petition (Civil) No.20417of 2017,the proceedings arising from the order dated 21.06.2017 and theEorders passed by this Court were noted by this Court in theJudgment asunder:

“Proceedings before this Court

13. The order dated 21.6.2017 of the Delhi High Court waschallenged by the petitioner before this Court and the mainFcontention of the petitioner was that despite the respondentsviolating the undertakings time and again restraint orders werenot being passed. In the Special Leave Petition (Civil) No.20417of 2017 filed by the petitioner this Court passed the followingorder on 11.08.2017: - G

“In the interim it is directed that status quo as on today withregard to the shareholding of Fortis Healthcare Holding PrivateLimited in Fortis Healthcare Limited shall be maintained.”

As per the statutory disclosures made by FHHPL to theBSE and National Stock Exchange (NSE), it was disclosed that H

on 14.08.2017, 30,59,260 shares of FHHPL in FHL were pledgedin favour of Indiabulls Housing Finance Limited (IHFL).

14. The petitioner filed a contempt petition being Diary No.27334of 2017 alleging that the conduct of the respondents in creating a13 pledge on 14.08.2017 is violative of the order dated 11.08.2017In the meantime on 21.08.2017, OIL filed an application beingI.A. 77497 of 2017 for directions permitting sale of encumberedshares to pay its debts and also prayed that a clarification beissued that the order dated 11.08.2017 is limited to shares otherthan to those pledged to banks and financial institutions. In I.A.77497 of 2017, OIL had stated as follows: - “24. It is in these circumstances that the Respondent Companyseeks a direction from this Hon’ble Court that the order dated11 August 2017 passed by this Hon’ble Court is limited to sharesother than those pledged to the banks and the financialinstitutions, the sale of which is being made after obtainingprior consent of the pledgee(s).

25. It is submitted that the said direction will not, in any event,have an impact on the potential creditors and that the availabilityof these funds will only help pare down the debt. This will onlyraise the value of the shares held by Respondents.”

Similar application being I.A. No.76959 of 2017 withidentical paragraphs 24 and 25 was filed by RHC.

15. On 31.08.2017, this Court directed as follows:- “As the present Special Leave Petition is due to come up for afuller consideration on 23rd October, 2017, we do not considerit necessary to delve into the issues raised at this stage as thetime taken to answer the same would be the same as would berequired to hear and decide the matter finally. We, therefore,decline to pass any order in the matter, save and except, to puton record that the interim order of this Court dated 11th August,2017 was intended to be in respect of both the encumberedand unencumbered shares of Fortis Healthcare Limited heldby Fortis Healthcare Holding Private Limited. Consequently,there will be no transfer of the shares to the extent indicatedabove.

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AParties may complete the pleadings in the meantime.

As we have now clarified the previous order of this Courtdated 11th August, 2017 no case for contempt is made out.However, it is needless to say that the present order and theabove clarification would govern the rights of the partiesBhenceforth. The contempt petition is accordingly disposed of.”

16. On this date, the contempt petition was disposed of and at thesame time it was mentioned that the order and the clarificationcontained therein would govern the rights of the parties henceforth.The order dated 11.08.2017 and 31.08.2017 were later clarifiedby this Court vide order dated 15.02.2018 which reads as follows:- C

“Having heard the learned counsels for the parties, we clarifyour interim orders dated 11th August, 2017 and 31st August,2017 to mean that the status quo granted shall not apply toshares of Fortis Healthcare Limited held by Fortis HealthcareHolding Pvt. Ltd. as may have been encumbered on or beforethe interim orders of this Court dated 11th August, 2017 and31st August, 2017.

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The applications for directions are disposed of in the above terms.”

It would be pertinent to mention that on 23.02.2018, thisECourt passed the following order:

“Interim order of this Court dated 15th February, 2018 willcontinue to hold the field till the High Court decides the matter.”

17. During the period 06.09.2018 to 18.09.2018 Indiabulls VenturesLimited (IVL), with which FHHPL maintains a demat accountFtransferred 12,25,000 shares of FHL held by FHHPL to IHFL. Inthe present contempt petition filed in October, 2018, it is allegedthat this transfer of shares was in contempt of the orders dated11.08.2017, 31.08.2017, 15.02.2018 and 23.02.2018.”

5. As stated in Paragraph 17 quoted hereinabove, ContemptGPetition (C) No.2120 of 2018 was filed in this Court alleging that transferof shares were effected in violation of the orders dated 11.08.2017,31.08.2017, 15.02.2018 and 23.02.2018 passed by this Court. Whiledealing with the matters in issue including the question whether 12,25,000shares were pledged prior to 11.08.2017 or not, this Court had set out aHchart in paragraph 3 of the Judgment as under:

6. The issues whether there was contempt of the orders passedby this Court and whether pledge of 12,25,000 shares was prior to11.08.2017 or not were considered by this Court as under:

“21. The main issue is whether these 12,25,000 shares werepledged prior to 11.08.2017 or not. At this stage it would be pertinentto mention that the stand of IHFL that no pledge was createdafter 11.08.2017 is incorrect. The disclosure made on 21.08.2017by FHHPL to BSE and NSE clearly discloses that 30,59,260 sharesof FHL held by FHHPL were pledged on 14.08.2017 in favour ofIHFL. This disclosure of 21.08.2017 is a part of the record andnot specifically denied by IHFL.

22. We may point out that till October 2017, IHFL was notrepresented in this Court. However, on 16.08.2017 and 31.08.2017

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Athrough emails RHC informed IHFL about the status quo orderpassed by this Court. Thus, IHFL cannot claim that they were notaware of this Court’s orders. However, from the material on recordespecially the replies filed by OIL, RHC, MMS and SMS it isapparent that on 06.09.2018, 07.09.2018, 08.09.2018 IHFLtransferred 6,00,000 shares of FHL held by FHHPL. When RHCBcame to know about these transfers, it immediately informed IHFLthat transfers were in violation of the orders passed by this Courton 11.09.2017. Despite the communication dated 11.09.2018, IHFLcontinued to transfer shares of FHL held by FHHPL on 11.09.2018,12.09.2018, 14.09.2018, 17.09.2018 and 18.09.2018. On 24.09.2018,Cthis Court was informed that IHFL had transferred 12,25,000 sharesheld by FHHPL in FHL in violation of the Court’s orders. As on29.09.2018, another transaction of 9,04,760 shares had taken place.The main issue is whether 12,25,000 shares were encumbered ornot.

D23. FHL is a public company and being a listed company, it has todisclose its shareholding patterns to the stock exchange. A chartshowing share holding pattern of FHHPL in FHL will show theposition of holdings at various stages:

It is true that we have to decide whether there is any disobedienceof the orders of this Court, but while doing so we will makereference to the proceedings before the Delhi High Court and theabove chart to show how both sets of respondents have violatedthe orders of the courts. As pointed above, on 19.06.2017 learnedcounsel for OIL and RHC had made a statement before the DelhiHigh Court that the status of unencumbered assets as disclosedto the court would not be changed and the shareholding asdisclosed in terms of order dated 06.03.2017 shall not be affected.When the petitioner felt that this order is not being complied with,it filed contempt petition in the Delhi High Court. Within two daysanother order was passed by the Delhi High Court on the basis ofthe undertaking given to it.

24. The above chart would show that in the quarter ending June2017, the total shares held by FHHPL in FHL were 22,22,11,701and the encumbered shares were 18,38,96,484. Only 3,83,15,217,were unencumbered.

25. This Court on 11.08.2017 directed that status quo with regardto shareholding of FHHPL in FHL be maintained. On 31.08.2017it was clarified that the order would apply to both encumberedand unencumbered shares. On 14.08.2017, 30,59,260,unencumbered shares were pledged in favour of IHFL. As far asthis violation of the order dated 11.08.2017 is concerned, in viewof the order dated 31.08.2017, the same stands condoned. Thiswould further mean that the unencumbered shares should havebeen reduced to 3,52,55,957.

26. However, the figures of September 2017 show a totallydifferent situation. The total shareholding has fallen to 17,80,26,597and the unencumbered shares to 26,31,777. This means that inaddition to 30,59,260 shares pledged on 14.08.2017, 3,26,24,180number of shares were encumbered or transferred during thisperiod. There is no explanation by OIL, RHC, MMS or SMS, asto how these unencumbered shares were encumbered ortransferred in total violation of the orders of the courts.

27. We shall now deal with the issue as to whether IHFL andIVL had violated the orders of this Court or not? To decide thisissue, it would be appropriate to determine whether IHFL

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transferred any shares which were not encumbered up to14.08.2017.

28. This brings us to the shareholding pattern of FHL for theperiod between 01.07.2018 and 30.09.2018 because it is duringthis period that IHFL transferred the shares. According to IHFLthese 12,25,000 shares stood pledged with them. Neither in I.A.No.109493 of 2017 nor in the reply filed by contemnor nos. 1-8, isthere any clear-cut statement as to how and when the differentpledges were created. Reference has been made to loandocuments of 2016 and also to the pledge of 14.08.2017. Accordingto alleged contemnor nos. 1 to 8, FHL was maintaining a demataccount with IVL. The case set up is that when the value of theshares of IHFL fell in the market, to make the security equal tothe outstanding due to IHFL, further shares were transferred byIVL to IHFL. It is urged that this was done in view of theinstructions given prior to 11.08.2017 by FHHPL to IVL and IHFL.

These transfers were done on the basis of the delivery instructionsslips executed by IHFL as power of attorney holder of FHHPL.Even if this be true, the alleged contemnors are guilty of violatingthe orders of this Court. The order dated 11.08.2017 clearly debarsFHHPL from changing its shareholding in IHFL. Vide order dated31.08.2017, it was clarified that the order dated 11.08.2017 wouldapply both to encumbered and unencumbered shares. It was onlyon 15.02.2018 that the order was clarified that it would not applyto shares encumbered prior to 11.08.2017 and 31.08.2017. Areading of the 3 orders makes it clear that no unencumbered sharescould be charged after 31.08.2017 at least. Even if FHHPL hadgiven power of attorney empowering IVL to transfer shares fromits demat account to top up the security value, that power ofattorney could not be used to violate the orders of this Court.What FHHPL could not do, could obviously not be done by itsagent or attorney. The shares which were used to top up thesecurity after 31.08.2017 were obviously unencumbered sharesprior to this date. The plea is clearly unacceptable and a lameexcuse for the wilful disobedience of the order directingmaintenance of status quo which, as modified, was to apply tothe unencumbered shares. The respondents were aware andcannot claim ignorance of the purported agreements under whichthey were required to top-up upon the securities, in case of fall of market value of the shares. In other words, the interim orderpassed by this Court was to apply even if there was a fall inmarket value of the securities held by the creditors.

29. To make this position clear, we may refer to the disclosuresmade by FHL to BSE. The above chart shows that in the quarterending 30.06.2018, FHHPL held 32,82,851 shares in FHL out ofwhich only 5,51,484 were encumbered, meaning that the balance27,31,367 were unencumbered shares. The disclosure of30.09.2018 and 31.12.2018 both reflect that the number ofencumbered shares have not changed but the total shareholdingof FHHPL in FHL has reduced from 32,82,851 to 11,53,091. Thismeans that what was transferred were 21,29,760 unencumberedshares and not encumbered shares. The transaction of 12,25,000shares therefore is out of the unencumbered shares because after31.03.2018, the encumbered shares were much below 12,25,000.

30. We are not entering into the dispute whether the shares weretransferred on the basis of pre-signed slips or delivery instructionslips based on the power of attorney but the fact remains that theofficial record shows that these shares were not encumbered andthe contemnors have failed to place any cogent material on recordto show that these 12,25,000 shares were pledged on or before31.08.2017.

31. IHFL, in fact, flagrantly violated this Court’s orders and madevarious transactions transferring even unencumbered shares. Thebest course available to IHFL would have been to approach thisCourt seeking a clarification before it made the transfers. Thisthey did not do. We are, therefore, clearly of the view that IHFLand IVL and their officials i.e. contemnor nos.1 to 8 knowing fullywell that this Court had passed an order directing status quo to bemaintained with regard to the holding of FHHPL in FHL, violatedthe order. There can be no manner of doubt that IHFL and IVLhave violated these orders and, therefore, we find contemnor nos.1-8 who are active directors of IHFL and IVL guilty of knowinglyand wilfully disobeying the orders of this Court and find themguilty of committing Contempt of Court. We will hear them on thequestion of sentence.”

7. This Court thereafter considered the role of contemnor Nos. 9and 10, namely, Malvinder Mohan Singh (MMS) and Shivinder MohanSingh (SMS) respectively as follows:

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“34. We have given detailed facts of the shareholding of FHHPLin FHL during the period of quarter ending September 2016 toDecember 2018 hereinabove. As far as these contemnors areconcerned, the first assurance given by them to the High Court ofDelhi was on 24.05.2016 when they assured the High Court ofDelhi that any dealings made by them would not affect the rightsof the petitioners. As on 30.09.2016, FHHPL held 32,50,91,529shares in FHL out of which 27,21,59,955 shares were encumberedshares and 5,29,31,574 shares were unencumbered shares. Forvarious reasons, the total number of shares fell to 22,22,11,701 inquarter ending June 2017 and the number of encumbered sharesbecame 18,38,96,484 and the unencumbered shares dropped byabout 1.5 crore shares to 3,83,15,217. Even after giving anassurance on 21.06.2017 to the High Court of Delhi, unencumberedshares were encumbered or transferred as is apparent from theabove table.

35. The petitioner came to this Court when the order dated11.08.2017 was passed and clarified by order dated 31.08.2017.During this period also the total shareholding of FHHPL in FHLfell from 22,22,11,701 to 17,80,26,597 by 4,41,85,104 shares. MMSand SMS have not furnished any explanation as to how thishappened. The contemnors were the best persons to disclose howthis happened. They have not done so. The only explanation wehave before us is about the pledge of 30,59,260 shares on14.08.2017. It is difficult to ignore this huge drop in shareholdingbut even if we were to ignore this, we do not understand how inMarch 2018, the shareholding fell to 34,20,451 and finally inDecember 2018 to 11,53,091. The undertaking given to the HighCourt of Delhi was that the shareholding as on 19.06.2017 and21.06.2017 would be maintained. On 11.08.2017, this Courtinjuncted the respondents from changing the shareholding. On11.08.2017, this Court passed the order of status quo referred toabove. Despite that specific order, on 14.08.2017 a pledge wascreated. This was a violation of the orders of this Court. RHCand OIL filed applications before this Court on 21.08.2017 prayingfor modification of the order and for a direction that the orderdated 11.08.2017 may be limited to the shares other than thosewhich already stood pledged to banks and financial institutions.Though separate applications have been filed, Paragraph 25 ofboth the applications are identical and has been quoted hereinabove.

36. These applications were filed on affidavit and it has held outto this Court that if the order dated 11.08.2017 is limited tounencumbered shares it would have no impact on the availabilityof funds to protect the interest of the petitioner. On the basis ofthis statement, the order dated 31.08.2017 was passed and thisCourt took a lenient view on the matter and disposed of thecontempt without taking any action.

37. Unfortunately, the actions of these contemnors clearly showthat these statements were made without the least intention ofcomplying with them. These contemnors had already prepared awell thought out scheme of diluting their shareholdings directly orindirectly in FHL to defeat the rights of the petitioner.

38. The explanations provided are not worth consideration.According to SMS he was not even taking part in theadministration of these companies and had gone into religiousservice. This is belied from the fact that he has been attendingmost of the meetings of the Board of Directors. The next defencetaken by both the contemnors is that they lost control over thecompanies because the encumbered shares were sold. As pointedout above it is not only the encumbered shares but also theunencumbered shares which have been transferred. In December2017, the unencumbered shares of FHHPL in FHL were 26,31,777and in December, 2018 there were only 6,01,607 unencumberedshares. This shows beyond any manner of doubt that there hasbeen wilful violation of the orders of this Court. It is apparent thatthe contemnors knowingly and willingly lost control of FHL.

39. A litigant should always be truthful and honest in court. Onewho seeks equity must not hide any relevant material. In the presentcase, the petitioner has violated the undertakings given to the DelhiHigh Court as also the orders of this Court. The Delhi High Courtwill deal with the issue in so far as the undertakings made beforeit are concerned. We have no doubt in our mind that contemnornos.9 and 10 have also wilfully and contumaciously disobeyed theorders of this Court. What has happened during the period whenthis matter has been pending in this Court is that the shareholdingsof FHHPL, which is wholly owned by OIL and RHC which inturn are controlled by SMS and MMS, have virtually vanished inFHL. FHHPL owns no shares in FHL now. It may be true that AB

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IHH Healthcare Bhd. (Malaysian Company) through its actuallyowned subsidiary Northern TK Venture Pte Ltd. is now themajority stake holder but that is due to allotment of preferentialshares. In addition to the preferential shares allotted to them, theshares which were owned by MMS and SMS through theirholdings in FHHPL in FHL have vanished into thin air and theonly conclusion which we can draw is that this was a well thoughtout plan to deprive the petitioner from the amounts due to it.

40. No person or institution howsoever powerful, can be permittedto misuse the process of the Court. Contempt of court can becommitted in various ways. Civil contempt is defined under theContempt of Courts Act, 1971 under Section 2(b) to mean wilfuldisobedience of any judgment, decree, direction, order of the Courtof wilful breach of an undertaking given to the Court. Criminalcontempt has been defined under Section 2(c) to include anythingwhich scandalizes or tends to scandalize or lower or tends to lowerthe authority of the Court. Criminal contempt also means any actwhich prejudices or interferes or tends to interfere with the duecourse of judicial proceedings. As far as the present case isconcerned, the conduct of contemnor nos.9 and 10 definitelyundermines the authority of the Court. We are dealing with aninternational arbitration which has fructified into an award but bymisusing the legal process contemnor nos.9 and 10 havesuccessfully avoided paying off the petitioner. In our view, actionfor committing criminal contempt could have been taken againstcontemnor nos. 9 and 10, but by taking a lenient view of the matterwe are only treating it as a civil contempt.

41. The order passed by this Court on 11.08.2017 with aclarification on 31.08.2017, and modification made on 15.02.2018,is not to be read in isolation but along with the solemn undertakingsand assurances given by the contemnors on as many as fiveoccasions before the Delhi High Court, the last one being as lateas on 21.06.2017. These assurances were to the effect that evenif the Court permits sale of encumbered shares for payment ofdebt, it would not have any impact on the (potential) creditors andavailability of the funds would only pare down the debt and increasethe value of the shares. Contrary to the aforesaid solemnassurances and undertakings, which were repeatedly reiterated to procure orders, the shareholding went into a downward spiral,as is apparent from the table in paragraph 23. There was asignificant decline in the total number of shares held by FHHPL,both encumbered and unencumbered, which fell down from27,21,59,955 and 5,29,31,574 in September 2016 to 5,51,484 and6,01,607 in December 2018. The aforesaid fact with the impacton valuation was never brought to the notice of the Court andwas concealed with the knowledge that these facts, if brought tothe notice, would have substantial bearing on the orders that wouldbe passed to protect the interest of the petitioner.

42. What is even more shocking and clearly contemptuous is themanner in which, in a well thought off plan, the authorized capitalof FHL was increased with the objective and purpose to transfercontrolling interest in the company. Consequently, the controllinginterest of MMS and SMS came down in FHL, as the companychanged hands. Controlling interest held by the majorityshareholders has considerable market value. Further, the amountbrought in by a foreign shareholder, who now has the controllinginterest in FHL, has been transferred in a dubious and clandestinemanner without full facts being brought on record. This amount isnot available for payment and satisfaction of the Award. AboutRs.4,600 crores has been transferred in a very hurried andclandestine manner to a trust registered in Singapore i.e. RHTHealth Trust (RHT). Coincidentally, respondents no.9 and 10themselves or through their holding companies were at one timethe biggest unitholders in the trust. It is obvious that the respondentsbeing debtors are maneuvering, transferring and converting theassets of value, with the desire and intent that the petitioners wouldnot be able to recover the decretal amount as per the award.

43. We would, therefore, not read the orders of this Court inisolation but along with the five solemn assurances and undertakingsgiven before the High Court. Directions given by this Court andthe orders passed were in light of the fact that the contemnorsalways projected that the said assurances and undertakings werebinding and adhered.

44. There can be no manner of doubt that contemnors 9 and 10have changed the shareholding of FHHPL in FHL knowingly andwilfully. They have done this with a view to defeat the rights of AB

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the petitioner. They have also wilfully and contumaciously violatedthe orders of this Court dated 11.08.2017, 31.08.2017 and15.02.2018. They are accordingly held guilty of committingcontempt of court. We shall hear them on the question of sentence.We give one chance to the contemnors no.9 and 10 to purgethemselves of the contempt.

45. On 21.06.2017, a statement was made on behalf of contemnornos. 9 and 10 before the High Court of Delhi that in respect ofany transaction that these respondents may enter into, a sum ofRs.2341.90 crores i.e. Rs.452.60 crores of OIL and Rs.1889.30crores of RHC would always be made available and realizablefrom the assets of the company. We, therefore, direct that in caseeach of the respondents deposits a sum of Rs.1170.95 crores i.e.50% of Rs.2341.90 crores in this Court within eight weeks fromtoday then we may consider dealing with them in a lenient manner.

Violation of order dated 14.12.2018

Violation of order dated 14.12.2018

46. It was also argued that contemnor nos.9 and 10 have alsoviolated the order dated 14.12.2018. Since this is not the subjectmatter of the main contempt petition and no notice has been issuedto the concerned parties in this regard, we feel that this issue hasto be segregated from the rest of the contempt petitions becausethe main pleadings and replies are in respect of the alleged contemptof orders dated 11.08.2017, 31.08.2017, 15.02.2018 and23.02.2018.

47. However, we cannot let the matters stand as they are. On14.12.2018, this Court had passed the following order:

“Issue notice. The personal presence of the allegedrespondentscontemnors is dispensed with for the present. Statusquo with regard to sale of the controlling stake in FortisHealthcare to Malaysian IHH Healthcare Berhad bemaintained.”

The order directs that the status quo with respect to thesale of controlling stake in FHL to IHH Healthcare Bhd.(Malaysian Company) should be maintained. We are now toldthat this sale had already taken place. This matter needs to beenquired into and we have to be certain when this sale actually took place and when was the controlling stake in FHL transferredto the IHH Healthcare Bhd. (Malaysian Company). Furthermore,on 09.01.2019, FHL moved an application in this Court and statedthat the transaction between the FHL and IHH Healthcare Bhd.(Malaysian Company) had been completed on 13.11.2018 andprayed that the order dated 14.12.2018 be modified insofar as itpertains to sale of controlling stake in IHH Healthcare Bhd.(Malaysian Company).

48. I.A. No.8948 of 2019 was filed by the petitioner on 15.01.2019stating that FHL is proposing to transfer Rs.4,000/- croresapproximately, received by it [as a result of the transferring ofshares to the IHH Healthcare Bhd. (Malaysian Company)] toRHT Health Trust, Singapore (RHT). Petitioner prayed forrestraining this transfer of funds and compliance of order dated14.12.2018. FHL filed a reply to this I.A., which made it apparentthat on 15.01.2019 itself FHL had completed the transactioninvolving acquisition of assets from Singapore based RHT eventhough it was fully aware that this Court was seized of the matter.

49. Interestingly, the main promoters of RHC and OIL i.e. MMSand SMS were the biggest unit holders in RHT when it was initiallyincorporated. The statistics of unit holding as on 20.06.2017 ofRHT Trust, Singapore shows that SMS, MMS, their familymembers, FHHPL, FHL and RHC virtually owned the RHT trust.That situation has now changed and now the situation is such thatthe companies/associations of which MMS and SMS are partnersare no longer visibly present and there are other persons who arethere. When and how the holdings in RHT trust were transferredby various people is a matter which is required to be gone into.”

8. Having found the contemnor Nos.9 and 10 and the entitiesRHC, OIL and FHL guilty of violating the assurances given to the Court,this Court directed in the Judgment as under:

“51. In view of the above discussion, we, dispose of this contemptpetition in the following terms: -

(i) We find Sameer Gehlaut, Director of Indiabulls HousingFinance Limited and Director of Indiabulls Ventures Limited(Contemnor Nos.1 & 5), Gagan Banga, Director of Indiabulls AB

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Housing Finance Limited and Director of Indiabulls VenturesLimited (Contemnor Nos.2 & 6), Ashwini Kumar Hooda,Director of Indiabulls Housing Finance Limited (ContemnorNo.3), Sachin Chaudhary, Director of Indiabulls HousingFinance Limited (Contemnor No.4), Divyesh Bharat KumarShah, Director of Indiabulls Ventures Limited (ContemnorNo.7) and Pinank Jayant Shah, Director of Indiabulls VenturesLimited (Contemnor No.8), who are active directors of IHFLand IVL of knowingly and wilfully disobeying the orders ofthis Court dated 11.08.2017, 31.08.2017 and 15.02.2018 ascontinued on 23.02.2018 and find them guilty of committingcontempt of this Court. We will hear them on the question ofsentence. We afford an opportunity to contemnor nos.1-8 topurge themselves of the contempt by depositing the value of12,25,000 shares as on 31.08.2017 in the Bombay StockExchange within eight weeks from today. In case, the saidrespondents purge themselves of the contempt, we may takea lenient view while imposing sentence.

(ii) Malvinder Mohan Singh, Director of Oscar InvestmentsLimited and Director of RHC Holding Private Limited(Contemnor Nos.9 and 12) and Shivinder Mohan Singh, Directorof Oscar Investments Limited and Director of RHC HoldingPrivate Limited (Contemnor Nos.10 and 13) have knowinglyand wilfully violated the orders of this Court dated 11.08.2017,31.08.2017 and 15.02.2018 as continued on 23.02.2018.Therefore, we hold both of them guilty of committing Contemptof this Court. We give one chance to them to purge themselvesof the contempt. We, direct that in case each of the contemnorsdeposits a sum of Rs.1170.95 crores in this Court within eightweeks from today then we may consider dealing with them ina lenient manner, while imposing sentence.

(iii) In case any of the contemnors deposits the amount asdirected hereinabove, this Court shall decide on the next dateas to how this amount is to be disbursed.

(iv) The Registry is directed to register a suo motu contemptpetition against RHC Holding Private Limited, OscarInvestments Limited, Malvinder Mohan Singh, Shivinder Mohan Singh and Fortis Healthcare Limited, for having wilfully violatedthe order of this Court dated 14.12.2018 and issue notice tothem returnable for 03.02.2020 asking them to show causewhy they should not be punished for contempt.

52. List the present contempt petition on 03.02.2020 when all thecontemnors named hereinabove shall remain present in the Court.On that day, we shall hear them on the issue of sentence. Alongwith this, the contempt petition which has been ordered to beregistered shall also be listed on 03.02.2020.”

9. In terms of leave granted in sub paragraph (i) of paragraph 51quoted above, the amount of Rs.17,93,40,000/- having been depositedby Contemnor Nos.1 to 8, it was held by this Court in its order dated18.12.2019that said Contemnors had purged themselves of the contemptand the matter was therefore closed as against them.

10. The Special Leave Petition and the Contempt Petition alongwith Suo Motu Contempt Petition No.4 of 2019, registered pursuant todirection (iv) in paragraph 51 as quoted above, were then taken up forhearing.

By order dated 11.2.2021, this Court issued notice to 17 Banks/Financial institutions with whom certain financial transactions wereentered into by the Contemnors and companies under their control; andsome of the shares were pledged to them, so that the version of saidBanks/ Financial institutions could be taken into account.

11. The Order dated 18.02.2021 passed by this Court noted thesubmissions advanced on behalf of the Contemnors, Noticees and Daiichi,whereafter certain directions were passed by this Court as under: -

“7. Mr. Kailash Vasdev, learned Senior Advocate, appearing forone of the contemnors had invited our attention to the affidavitfiled on behalf of Respondent No. 14 in compliance of order dated14.05.2018 (Volume 55). The tabular chart given in paragraph 7of said affidavit and assertions in paragraph 8 thereof were to thefollowing effect:

“7. The details of the number of shares held by FHHL in FHLare as follows:

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[2022] 11 S.C.R.

FHL are protected by the order dated 23.02.2018 passed bythe Hon’ble Supreme and cannot be encumbered/alienated byFHHL. Copies of the orders dated 11.08.2017, 31.08.2017,15.02.2018 and 23.02.2018 passed by the Hon’ble SupremeCourt are annexed herewith and marked as Annexure A(colly).”

8. This reply, thus, clearly shows that though allegedly neitherRespondent No. 14 nor Respondent No. 19 sold or furtherencumbered any shares after 06.03.2017, various banks/financialinstitutions themselves exercised the right of pledge/top-up ofpledged shares without any reference to or action from eitherRespondent No. 14 or Respondent No. 19.

9. In the circumstances, notices were issued to various banks/financial institutions as detailed in the order dated 11.02.2021.

10. Appearing for some of the banks/financial institutions, Mr.Shyam Divan and Mr. Ramji Srinivasan, learned Senior Advocates;and Mr. Jayant Mehta, Mr. Sanjay Gupta and Mr. Sharma, learnedAdvocates, submitted inter alia that the issue was already goneinto by this Court and that there were no pleadings to which anyresponse could be filed by the concerned banks/financialinstitutions.

11. In reply, Mr. Rakesh Dwivedi, learned Senior Advocate invitedour attention to the chart set out in paragraph 23 of the Order, tosubmit that first three entries of the chart disclose that the totalnumber of shares remained constant at 32,50,91,529; and thatafter the assurance was given on 23.01.2017 by the concernedrespondents before the High Court of Delhi (marked as secondassurance in paragraph 5 of the Order), not only the total numberof shares started dwindling but the number of unencumberedshares went down from 7,31,68,281 to 6,01,607, as stated in thechart. Mr. Dwivedi, then, referred to the affidavit dated 08.02.2017filed on behalf of all the respondents in the High Court of Delhiwhich held out that the value of unencumbered shares was morethan Rs.4,000/- crores and that the value of the unencumberedsecurity was sufficient in the event the award was to be enforced.The relevant paragraphs of said affidavit were as under: - AB

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“2. That vide order dated 23.1.2017, this Hon’ble Court haddirected an affidavit to be filed by anyone of the Respondentson behalf of all the Respondents in respect of the unencumberedassets held by the Respondents in support of the assurancegiven to the Court as recorded in the letter dated 24.5.2016.

3. Therefore, in furtherance of the Order dated 23.1.2017, Iam filing the present affidavit on behalf of Respondent No. 19and all other Respondents.

4. All the Respondents had submitted their respective affidavitsdisclosing their assets on 6.12.2016 to this Hon’ble Court. Theaggregate book value of investments held by all the Respondents(excluding investments inter se amongst the Respondents) asper the said Affidavits is Rs.10,217.10 Crores out of whichinvestments to the tune of Rs.1,409.93 crores are encumberedleaving the residual investments to the tune of Rs.8,807.18Crore as unencumbered. Further, as on 31.12.2016, the bookvalue of investments held only by RHC Holding Private Limited(Respondent No.19) as on 31.12.2016 is Rs.6,510.54 Croresout of which investments to the tune of Rs.1,513.86 Croresare encumbered leaving the residual investments to the tuneof Rs.4,996.68 Crores as unencumbered.

5. Respondent No.19 has also undertaken an internal valuationof its unencumbered investments as on 31.12.2016 mentionedin para (4) above and based on such internal valuations, theestimated (on a conservative basis] fair value of itsunencumbered investments as on 31.12.2016 is approximatelyRs.3,453 Crores.

6. Apart from the aforesaid investments, Respondent No.19has also extended loans and advances (other than loans andadvances to other Respondent entities) and after netting offthe loans raised on current assets, the amount of loans andadvances recoverable is Rs.252.59 Crores as on 31.12.2016which is over and above the aforesaid investments.

7. There is no intention of selling any of the unencumberedinvestments by way of shares held by Respondent No.19. Aproposal which is under discussion may involve the sale of 29,00,000 equity shares of SRL Limited held by RespondentNo.19 and 7.05,000 equity shares of SRL Limited held by MalavHolding Private Limited (Respondent No.15) to externalinvestors in the near future. These shares of SRL Limited areencumbered and thus not included in the value of unencumberedassets mentioned at paras (4) & (5) above. Obviously this willhave to be after obtaining the consents of the security holders.The proceeds of such sale will have to be utilized to pare downthe debt – the net assets of the Respondents will thus remainunchanged. The shares being sold [36,00,000] which are below5% of the share capital of SRL will be sold to an externalinvestor. The further proposal under consideration is to mergeSRL with another listed group company at a later point of time.Even if this does take place, this will have no implications onthe next assets of the Respondents.

8. There are proposals to issue further capital in thedownstream companies [below Respondent No.19]. The netresult of issue of shares will be accretion in the value of theshares of the upstream company. The promoters would continueto remain the single largest shareholders in the companies wherefresh capital is being issued to minority investors, and that willcreate value going forward. The induction of a Private Equityfund or some such investor – were it to take place – willimprove the finances of the downstream companies and thusadd to the fair value of the unencumbered and encumberedshares.

9. The value of the unencumbered assets declared is sufficientsecurity for the Award in the event it is enforced. This fairvalue of the unencumbered assets as mentioned in para (5)does not include value of 5 crore equity shares of FortisHealthcare Limited held by the underlying subsidiary of theRespondents which have been kept aside from the aforesaidvaluation for the sake of flexibility and debt repayments ofvarious group entities.”

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control of FHHPL. He further submitted that at the stage whenthe applications for modification/clarification were preferred bythe banks and financial institutions, on the basis of which the orderdated 25.02.2018 was passed by this Court, none of the bankshad told this Court what the consequences of said order wouldbe; and that in a matter of a yearand-half, the shareholding ofFHHPL stood reduced to negligible level.

13. Mr. Arvind P. Datar, learned Senior Advocate, added thatthere would normally be a basic arrangement or loan agreement,in terms of which various kinds of securities including charge overproperties, corporate and personal guarantees would be offered;and that a pledge of shares would only be by way of an additionalsecurity. None of the banks/financial institutions had indicated whythe unencumbered shares were sought to be put underencumbrance or the shares were sold when other forms ofsecurities were available. He further submitted that thearrangements under which the shares were pledged must bedisclosed so that the purpose for which the basic accommodationor loan was obtained would also be clear. For example, accordingto him, in November, 2016 a loan agreement was entered intobetween India Bulls and RHC Holding Private Limited for anamount of Rs.350 crores purportedly for ‘construction/developmentof residential projects’. He submitted that no such project hadcome up and the amount of Rs.350/- crores through successivetransactions, was siphoned away. What kind of due diligence wasundertaken by the banks/financial institutions while extending theloan facility must therefore be brought on record.

14. Both the learned Senior Counsel submitted that with variousorders passed by the High Court and this Court, the concernedindividuals and corporate entities could not sell the shares held byFHHPL directly and, therefore, a device was employed and thearrangement was so structured that the shares were proceededagainst by the banks and financial institutions. It was submittedthat the banks/financial institutions had intervened in the matterspending before this Court, that they were definitely aware of theAward granted in favour of M/s. Daiichi Sankyo Company Limited;and that the role of banks and financial institutions would, therefore,require closer scrutiny.

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15. In the premises, for the present, we direct all the noticeebanks and financial institutions: - “(a)to place on record the basic documents pertaining to loansadvanced or financial accommodations extended in respectof which the shares of FHL were pledged with them; B

(b) to place on record the nature of securities offered inconnection with such loan arrangements;

(c) to place on record the details of the encumbered andunencumbered shares of FHL standing in the name ofFHHPL, held by them in September, 2016; C

(d) to place on record the details of encumbered andunencumbered shares of FHL standing in the name ofFHHPL, held by them on 11.08.2017; (e)to give details of shares of FHL standing in the name ofFHHPL, which were put by them under encumbrance afterD11.08.2017; (f)to give details of shares of FHL standing in the name ofFHHPL, sold by banks/financial institutions from January,2017; E

(g) to disclose whether such encumbrance created after11.08.2017 was in pursuance of any fresh arrangement oragreement and, if so, the details of such agreement/arrangement; (h)to disclose whether under such agreement/arrangement anyother security was given by the pledgors; and F

(i) to give the value of the encumbered shares as they stoodin September, 2016, on 11.08.2017 and on subsequentdates.”

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12. The subsequent Order dated 15.4.2021 passed by this Courtnoted submissions advanced on behalf of Noticee No.4 and passeddirections as under:

“Mr. Sanjay Gupta, learned advocate appearing for M/s.RBL Bank Ltd.- Noticee No.4 submits: - H

A(a)As on 11.08.2017, 38.75 crores shares of Fortis HealthcareLtd. stood pledged with the noticee in respect of facilitiesgranted to M/s. Religare Wellness Ltd (now known as RWLHealthworld Ltd.) and to Religare Aviation Ltd. (now knownas Ligare Aviation Ltd.)

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(b) On 20.02.2018, 33.75 crores shares were sold for Rs. 47crores while another tranche of 80,000 shares was sold on24.05.2018 for about Rupees one crore.

(c) Thus, 4.20 lakh shares are still under the control of NoticeeNo.4.

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(d) All the facilities now stand squared up and the amountsadvanced by the noticee have been recovered.

It is also submitted that the pledgor never approached thenotice for recovery of additional shares amounting to 4.20 lakhsDshares, though all the arrangements had squared up.

In the circumstances, we direct the Noticee No.4 to holdon to these 4.20 lakhs shares till further orders.

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13. All the concerned Contemnors as well as Noticees filed theirEresponses enclosing relevant documents and materials. The concerneddocuments run into more than 200 volumes. The broad outline ofsubmissions advanced on behalf of the Noticees is to the following effectthat for various financial accommodations/ loans taken by the companiesdirectly or indirectly under the control of Contemnor Nos.9 and 10,Fshareholding of FHHPL in FHL was pledged as collateral security withauthorisation in favour of the Noticees to sell those shares in open marketto protect the interest of the Noticees if the value of the security wasgetting reduced or diminished. Various transactions have been referredto in the responses filed on behalf of the Noticees and relevant documentsGin support have been placed on record.

14. A comprehensive list of dates and events emerging from thedocuments so placed on record by the Noticees is tabulated hereunder.The abbreviations used in the list of dates are as under: - •Axis Bank Limited (ABL)H

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•Ambit Finvest Private Limited (Ambit)

•Credit Suisse Finance (India) Pvt. Ltd. (CSFIPL)

•Dion Global Solutions Ltd. (DION)

•ECL Finance Ltd. (ECL)

B•Finserve Shared Services Limited (FSSPL)•FHL (Fortis Healthcare Limited)•FHHL (Fortis Healthcare Holding Limited)•Fortis Healthcare Holding Private Limited (FHHPL)C•Healthfore Technologies Ltd. (HTL)•Indiabulls Housing Finance Limited (IHFL)•Ligare Voyages Ltd. (LVL)•Lakshmi Vilas Bank (LVB)D•Oscar Investments Limited (OIL)•RHC Holdings Private Limited (RHC)•Religare Enterprises Limited (REL)E•Religare Aviation Limited/Ligare Aviation Ltd. (RAL/LAL)•Religare Finvest Limited (RFL)•Religare Capital Markets International (Mauritius) Limited(RCMIML)F

•Religare Wellness Ltd./RWL Healthworld Ltd. (RWL)

•Rantakar Bank Limited (RBL)

•Yes Bank Limited (YBL)

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The relevant dates regarding arbitral and execution proceedingsas well as the undertakings given on behalf of the respondents arehighlighted in the list of dates for easy reference. The list of dates andevents is as under:

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M/S. DAIICHI SANKYO COMPANY LIMITED v. OSCARINVESTMENTS LIMITED [UDAY UMESH LALIT, CJI]

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M/S. DAIICHI SANKYO COMPANY LIMITED v. OSCARINVESTMENTS LIMITED [UDAY UMESH LALIT, CJI]

15. The submissions advanced on behalf of the concernedContemnors, Respondents,Noticees and other parties, with salient pointsDare in the following volumes: - A.Volume 126: Submissions by Securities and Exchange Boardof India B.Volume 157: Brief Submissions by Mr. Arvind P. DatarEregarding Banks and Financial Institutions and Creation ofWrongful Pledges

C.Volume 160: Julius Baer Capital India Private Limited D.Volume 161: Indiabulls Housing Finance Limited F

E.Volume 163: ECL Finance Ltd.

F.Volume 178: RBL Bank Ltd.

G.Volume 182: Aditya Birla Finance Limited H.Volume 183: First Abu Dhabi Bank Limited G

I.Volume 191: Kotak Mahindra Bank Limited J.Volume 203: Credit Suisse Finance Limited •Released all pledges and closed both ANR and RHCFacilities before Supreme Court passed its status quoorder.

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AK.Volume 214: Submissions by Religare Finvest Limited(Respondent No.17)

L.Volume 215: Submissions by Religare Enterprises Limited,Religare Finvest Limited, Religare Comtrade Limited(Respondent No. 16, 17, 18)

B•No final relief has been claimed by the Petitioneragainst Religare Group •Petitioner’s Intervention resulted in interim stay inthe 23 Matters initiated at the instance of thisRespondent before NCLT

•Respondent, being a financial creditor of the debtorentities, its financial debts rank higher in the waterfallmechanism upon liquidation, as compared toPetitioner’s.

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•Religare didn’t participate in fraud and was not abeneficiary D

M.Volume 218, 225, 226: Submissions on behalf of ShivenderMohan Singh & Malvinder Mohan Singh (Contemnor No.9,10,12,13)

N.Volume 222: The Petitioner’s proposal for purging ofcontempt by the RespondentsE

•8 Properties being Land Areas and 1 Property beinga Building •3 Brands/Trademarks being Religare, SRL and Fortis•Cash in Bank available with Ligare Voyages(Ireland) LimitedF

•Cancellation of Pledges created or top up rightsexercised after 24.05.2016

•Withdrawal of Amount deposited by Indiabulls on18.11.2019

•Recovery from FHL based on assurances made bySingh Brothers before the Delhi High Court G

O.Volume 223: Petitioner’s Submissions regarding role ofShivender Mohan Singh •In every aspect, the Singh Brothers were togetherHtill Delhi High Court pronounced 31.01.2018

Judgement and Singapore High Court pronouncedjudgement dated 21.12.2018

P.Volume 224: Submissions by Yes Bank Limited (NoticeeNo.1)

•YBL is a secured creditor

•A clean chit has been given to YBL insofar as SubjectEncumbrances are concerned •YBL, vide submissions in Volumes 173 – 177, 199,clarified that it had created no encumbrances overFHL Shares post 11.08.2017, and subjectencumbrances were invoked only pursuant to15.02.2018 Order by SCI

•YBL was not a party before the Delhi High Courtwhen the assurances were given by the JudgementDebtors •YBL is not a judgement debtor qua the Petitioner •YBL has several recovery proceedings pendingagainst the JDs •FHHPL, under various pledge agreements with YBL,gave a representation that there was no litigationpending qua the FHL Shares.

•No personal guarantee obtained from SMS

•Cross Collateralization is not creation of freshencumbrances Q.Volume 228: Axis Bank Limited •A clean chit had been given to ABL

•Vol.197 Filed

•No Top Ups created by ABL

•Cross Collateralization Agreements only in relationto Pledges that were already encumbered and as perstandard industry lending practices •ABL invoked all pledges after 15.02.2018 Order A

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AR.Volume 162/229: Submissions by Lakshmi Vilas Bank(Noticee No.17):

•No notice of proceedings

•Bonafide Transactions(s) with Ranchem

•Pledging and Invocation of Pledge on Shares of FHLS.Volume 230: Submissions on behalf of Daiichi Sankyo(Petitioner)

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• 3 Proceedings pending before this Court –

1. SLP(C)20417/2017

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2. Contempt Petition (C) 2120/20183.SMC (C) 4/2019

• Banks and Financial Institutions categorized into three:

4.8 Banks that have wilfully violated the ordersand assurances given to DHC as well as toSCI

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5.4 Banks that released the shares and sold noshares after 24.05.2016

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6.4 Banks and Financial Institutions whichneither appeared nor filed any affidavit incompliance with order dated 18.02.2021.

•Petitioner be permitted to withdraw the ContemptDeposit F

•Direction to FHL/IHH to bring back Rs.4000 Croresand consequences thereof T.Volume 231: Ambit Finvest Private Limited

• Pledge over the shares never invoked

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16. We heard Mr. Mukul Rohatgi, Mr. Rakesh Dwivedi, Mr. ArvindP. Datar and Mr. Joydeep Gupta, learned Senior Advocates on behalf ofDaiichi while Contemnors Nos.9 and 10 were represented by Mr. KailashVasdev and Ms. Meenakshi Arora, learned Senior Advocates. On behalfof YES Bank Ltd. (YBL), Axis Bank Ltd. (ABL) and Indiabulls HousingHFinance Limited (IHFL) submissions were advanced by Mr. Shyam

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Divan, learned Senior Advocate while rest of the Noticees wererepresented by the other learned Counsel.

17. The basic submissions made on behalf of Daiichi were:

(A)The respondents having suffered a Foreign Award, deviseda well-planned scheme to dilute the share-holdings held byBcompanies controlled by said Contemnors Nos.9 and 10;and thus, attempted to frustrate the execution of said award.

(B)Various transactions referred to in the documents submittedbefore the Court clearly show that multiple forms of Securityincluding charge on immovable properties, personalundertakings and other securities were available to the banksand financial institutions. However, what was proceededagainst were the shares held by FHHPL in FHL.

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(C)The manner in which the controlling interest in FHL, whichcompany in turn controlled all the physical assets, wasdiluted, was doubtful and questionable. Similarly, theacquisition of the controlling interest by IHH/NTK wouldshow that the very same assets are now being controlledby RHT which was nothing but a trust established byContemnor Nos. 9 and 10.

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(D)These transactions were not bona fide and in order tounravel the truth, this Court may consider appointing ForensicAuditor(s).

18. In the written submissions filed by Daiichi, the roles of theJudgment Debtors as well as of various entities were specifically dealtwith as under:

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“A. Judgment Debtors:

I. The Petitioner filed SLP [Vol 1and2] on 22 June 2017 [SLP VolI and 2]. Mr. Rakesh Dwivedi, Senior Advocate, made submissionson behalf of the Petitioner [SLP Vol 221, 223], inter alia, againstarguments made by counsel for MMS and SMS (Mr. KailashVasdev and Ms. Meenakshi Arora, respectively). Petitioner hasalso specifically responded to this Hon’ble Court’s query regardingthe pleadings against Judgment Debtors in the Contempt Petition[SLP Vol 217] on the basis of which the Contempt Judgment waspassed, against them.

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A2. The Judgment Debtors were given full opportunity to respondand defend their case before this Hon’ble Court. MMS and SMSfiled separate replies to the SLP and the Contempt Petition. MMSfiled its reply affidavit in SLP dated 13 March 2019 (SLP Vol 54,55) and SMS filed its reply to SLP on 12 March 2019 (SLP Vol53). MMS also filed its reply to Contempt Petition (SLP Vol 59).BIn addition, MMS filed a sur-rejoinder in the Contempt Petition(SLP Vol 65). SMS also filed a sur-rejoinder in the ContemptPetition (SLP Vol 62). The Petitioner filed a rejoinder-affidavit tothe reply of MMS (SLP Vol. 61). The Petitioner in its rejoinder-affidavit explained how MMS and SMS blatantly misled the courtCby asserting that the banks and financial institutions had acted ontheir own accord in invoking their right to top-up under pre-existingcontractual obligations. Petitioner also showed how theRespondents obstructed the course of justice by falsely assertingthat five crore shares had already been kept aside for satisfyingthe debts of the banks and financial institutions and that a sufficientDnumber of unencumbered shares were available to satisfy andrealize the Award. The Respondents never informed the courtsof the existence of “pre-signed slips” which could be used by thebanks and financial institutions on account of Respondents’ pooreconomic condition and inability to service the debt or theE“manufactured defaults”. The Respondents submitted before theDHC that “ ...[On a Group basis, the market fair value of assetspledged is more than sufficient to meet the liabilities. Were it notto be so, the lenders would have asked for topping of the securities”[SLP Vol. 149/Page 18-25].

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3. Mr. Dwivedi made rebuttal submissions against the JudgmentDebtors [SLP Vol 221/Page 1-9, 17-23]. His submissions were (i)Judgment Debtors made active misrepresentations regardingunencumbered shares/ existence of top-up clauses to the Petitioner,DHC and this Hon’ble Court; (ii) the value of assets of RHC andOscar in the form of FHHPL shares derived their value solelyfrom the value of the shares of FHL owned by FHHPL; (iii) therewas no fall in the share price of FHL shares due to any stepstaken by Daiichi to enforce the Award; and (iv) Judgment Debtorsdid not take steps in the commercial interest ofFHL. In respect ofI.A. No. 43119 of2020 filed by MMS in the SLP, the Petitionerfiled its reply [SLP Vol 110/Page 1-11], inter alia, agreeing with F

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the proposal for a forensic audit of all entities in Table “A” andTable “B” [SLP Vol 222/Page 2]. Furthermore, the Petitioner alsoagreed to MMS’s request for the sale of land parcels, brand/trademarks and operating companies, and the monies so realizedto be deposited with this Hon’ble Court in the Petitioner’s favour.

4. In response to this Hon’ble Court’s query regarding the proposalfor purging of contempt, the Petitioner has proposed certain reliefsagainst the Judgment Debtors: ([SLP Vol 222/Page 2-4]

B. Banks and Financial Institutions

5. The Petitioner, pursuant to the Contempt Judgment, in itsresponse to reply filed by FHL in the SMC [SMC Vol 26/Page27- 37], apprised this Hon’ble Court of the creation of pledgesand the exercise of top-ups by banks and financial institutions incollusion with MMS, SMS, other Judgment Debtors, IHHHealthcare Berhad and FHL, which ultimately led to the dilutionof the controlling shareholding of OIL and RHC (through FHHPL)in FHL.

6. Thereafter, Mr. Arvind P. Datar, Senior Advocate, on behalf ofthe Petitioner, by way of oral submissions and brief writtensubmissions - filed on 17 February 2021 [SLP Vol 157], informedthis Hon’ble Court that wrongful pledges were created after thefirst assurance was given to the DHC on 24 May 2016. Sincethese pledges were created in violation of court orders, Mr. Datarrequested this Hon’ble Court to pass orders to, inter alia, restorethe status quo ante in respect of the shareholding of FHHPL inFHL, as on 24 May 2016, and to restitute the Petitioner in respectof creation of all wrongful pledges after 24 May 2016.

7. In its written submissions [SLP Vol 125/Page 3], the Petitionerhas requested this Hon’ble Court to void the impugned pledgesand/securities created after 24 May 2016 or, in the alternate, tocompensate and restitute the Petitioner for the loss caused due tothe creation of pledges and subsequent sale of shares by banks/financial institutions on or after 24 May 2016 [SLP Vol 125/Page6-7]. The Petitioner has also informed this Hon’ble Court of thescheme adopted by the banks and financial institutions in collusionwith MMS, SMS, FHL and IHH, to deprive the Petitioner of therights accorded to it on FHL shares by the systemic dilution of A

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controlling stake of FHHPL in FHL [SLP Vol 138/Page 7/Paragraph/9-11,15].

8. In view of the above submissions, this Hon’ble Court, by orderdated 18 February 2021, directed various banks and financialinstitutions to file affidavits responding to certain queries by thisHon’ble Court. In purported compliance with the order dated 18February 2021, some of the banks and financial institutions havefiled their affidavits. The Petitioner has filed additional submissionsdated 23 March 2021 [SLP Vol 187] informing this Hon’ble Courtof the contemptuous acts of the banks and financial institutions incollusion with the Judgment Debtors. The Petitioner informed thisHon’ble Court that, until May 2017, there could not have beenany occasion for a top up by banks or financial institutions as theshare price of FHL shares had remained more or less stable andthe share price had not been impacted. It was submitted that thebanks and financial institutions had actively misled this Hon’bleCourt along with the Judgment Debtors to obtain orders dated 15February 2018 (modification of ordersdated 11 August 2017 and31 August 2017 in SLP) from this Hon’ble Court by submittingthat “any change in the status of encumbered assets of the saiddownstream companies or any change in the shareholding ofRespondent No. 1 and 8 herein in the downstream companies inorder to reduce liabilities, will not have any negative impact, eitheron the value of assets or the no. of unencumbered shares” [SLPVol. 187/Page 4/Paragraph 4]. It was thus submitted by thePetitioner that the banks and financial institutions were fully awareof the court orders and the assurances given to the DHC by theJudgment Debtors and are, therefore, guilty of a deliberate andwilful violation of the orders of the DHC.

9. Following detailed oral submissions by Senior Counsel on behalfof the banks and financial institutions - Mr. Shyam Divan (Yes,Axis and IHFL), Mr. Gopal Jain (L VB, Julius Baer and FirstGulf), Mr. Pinaki Mishra (Credit Suisse), Mr. Ramji Srinivasan(Ambit Finvest) and Mr. Amit Sibal (ECL Finance), the Petitionerfiled its rebuttal/rejoinder submissions on 12 May 2021 [SLP Vol.221/11/10-16, 24-103]. Mr. Dwivedi also made extensive oralsubmissions rebutting the submissions made by the banks andfinancial institutions. For the convenience of this Hon’ble Court,

Mr Dwivedi categorized the banks and financial institutions intothe following three categories:

(i) Category I: Eight banks that have wilfully violated the ordersand assurances given to the DHC as well as to this Hon’bleCourt should be issued a notice of contempt [SLP Vol 221/Page 47-64];

(ii) Category II: Four banks that have released shares and havesold no shares after 24 May 2016 [SLP Vol 221/Page 65-71]; and

(iii) Category III: Four banks and financial institutions whichneither appeared nor filed any affidavit in compliance withthe order dated 18 February 2021 [ SLP Vol 221/Page 83].

10. In response to this Hon’ble Court’s query regarding the proposalfor purging of the contempt by the contemnors, the Petitioner hasproposed certain reliefs with respect to the wrongful pledgescreated by the banks and financial institutions contemptuously andfor a direction to conduct a forensic audit. [SLP Vol 222/Page 4-5].

C. Fortis Healthcare Limited and IHH Healthcare Berhad

11. Mr. Mukul Rohatgi, Senior Counsel, on behalf of the Petitionersubmitted that at the time of issuance of the Award, the SinghBrothers, through their group companies, RHC and OIL, enjoyeda controlling shareholding (71.7%) in FHL, a listed company whichowns and controls various hospitals across India [SLP Vol 133].The ownership of FHL at the relevant times is described in achart filed by the Petitioner [Annexure W- 1/SLP Vol 133/Page10] [Also, SMC Vol 26/Page 20]. The Petitioner, at all times, hassubmitted that the value of shares of RHC and Oscar in FHHPLwas derived solely from FHHPL’s controlling stake in FHL [SLPVol 221/Page 2].

12. On 06 December 2018, the Petitioner filed I.A. No. 176128of 2018 in SLP (SLP Vol 40) seeking leave to file additionaldocuments in the Contempt Petition. These documents disclosedthe shareholding pattern ofFHL for the quarter ending June 2017to the quarter ending September 2018 in order to highlight thediminution of shareholding held in FHL through FHHPL. The A

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Petitioner had also filed application - IA No.9264 of2018 beforethe DHC on 16 July 2018 in the enforcement proceedings drawingattention to the press releases dated 27 March 2018 and 13 July2018 showing that IHH was proposing to acquire FHL and assetsofRHT Trust [SLP Vol 40/page 83-85]. The Petitioner prayedthat the Judgment Debtors be directed to deposit the entire decretalamount and FHL be injuncted from proceeding ahead with thetransaction with IHH Healthcare [SLP Vol 40/page 94]. FHL fileda reply to IA 9264 of 2018 on 31 July 2018 [SLP Vol 40/Page 98-127]. The Petitioner has submitted that sufficient material wasplaced before this Hon’ble Court which established that (i) theJudgment Debtors not only breached the undertakings given tothe DHC but they also violated the orders of this Hon’ble Court;(ii) false affidavits were filed by the Judgment Debtors both in theDHC as well as before this Hon’ble Court; and (iii) this Hon’bleCourt had been deliberately misled by the Judgment Debtors, andbanks and financial institutions to obtain a modification on 15February 2018 of the status quo orders dated 11 August 2017 and31August 2017.

13. The Petitioner also filed an application for directions (I.A.No. 8948 of 2019) in the Contempt Petition on 15 January 2019,upon learning that, despite this Hon’ble Court’s order dated 14December 2018, the transaction of transferring the controllingstake in FHL to IHH was proceeding ahead and the amount ofINR 4000 crores received by FHL was being transferred to RHTTrust, in which the Singh Brothers and Judgment Debtors had asubstantial interest. The Petitioner had prayed in this applicationthat the transfer of funds to RHT be injuncted until the undertakingrecorded in DHC order dated 21 June 2017 was fulfilled/satisfied,and also to ensure compliance with the order dated 14 December2018. [SLP Vol 45/page 9-19].

14. The Petitioner filed another application for directions (IA No.15162 of 2019) in the Contempt Petition on 24 January 2019 [SLPVol 46/Page 1-5] after ascertaining that FHL had completed theacquisition of portfolio assets ofRHT and on 15 January 2019INR 4650 crores had been transferred in violation of this Hon’bleCourt’s order dated 14 December 2018 within a few hours ofPetitioner’s application. FHL filed a reply to I.A. No. 8948 of2019

[SLP Vol 50] and to I.A. No. 15162 of2019 [SLP Vol 49] inFebruary 2019.

15. On 09 March 2021, during the course of oral submissions,FHL defended the RHT transaction and submitted that FHL’sactions did not amount to an act of contempt. Mr. Datar, in hisoral and written submissions dated 18 March 2021 [SLP Vol 185],while addressing this Hon’ble Court’s queries related to the roleof IHH, FHL and RHT, highlighted the clandestine method bywhich the amount of INR 4000 crores was transferred out ofIndia, despite knowledge of the pending application and the statusquo order dated 14 December 2018. Mr. Datar also submittedthat the remittance of INR 4000 crores was in clear violation ofthe status quo order dated 14 December 2018. He submitted thatsince RHT had, on 31 December 2018, made a disclosure to theSingapore stock exchange of the extension of the long stop dateto 26 March 2019 for the RHT Transaction, there was no apparenturgency to remit this amount to RHT on 15 January 2019. Tofrustrate the claims of the Petitioner further, the monies receivedin violation of the order dated 14 December 2018 were immediatelydistributed by RHT to its unitholders [SLP Vol 185/Page 9]. Ofthis amount, FHL has admittedly received - INR 817 crores [SMCVol 37/Page 81].

16. Mr. Datar briefly reiterated the Petitioner’s position on theRHT transaction during the closing arguments on 12 May 2021.Mr. Datar also placed reliance on the principle of tort of conspiracyto explain the large-scale conspiracy carried out by the banksandfinancial institutions in tandem with the Respondents, FHL andIHH, and argued that that it is only just and proper that FHL isdirected to make available the amount of INR 4000 crores forDaiichi to ensure restitution in respect of the undertaking given byits Chief Executive Officer and Managing Director (SMS andMMS respectively) on 21 June 2017 [SMC 26/Page 63/Paragraph97].

17. In response to this Hon’ble Court’s query regarding the proposalfor purging of contempt, the Petitioner has proposed certain reliefsagainst Fortis Healthcare Limited and IHH Healthcare Berhad[SLP Vol 222/Page 6].

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D. RHT Trust, Singapore

18. Mr. Datar made oral submissions regarding the FHL-IHH-RHT transaction. In a nutshell, the submissions were as follows:(i) Mr. Gurinder Singh Dhillon and Mr. Gurpreet Singh Dhillon areunitholders of RHT. Mr Gurpreet Singh Dhillon was an executivedirector and chief executive officer of RHT [SLP Vol 26/Page61-62]; (ii) FHL-IHH-RHT transaction was initially negotiated in2017 between the Singh Brothers and IHH [SLP Vol 26/Page37]; and (iii) FHL-IHH-RHT transaction was undertaken at thebehest of and for the mutual benefit of the Singh Brothers, FHL,IHH and various banks and financial institutions [SLP Vol 26/Page 43]. It should be noted that Mr. Gurinder Singh Dhillon andMr. Gurpreet Singh Dhillon are close relatives of the Singh Brothersand it is probable that the Dhillon family (of which Mr. GurinderSingh Dhillon and Mr. Gurpreet Singh Dhillon are members) alsobenefitted from the FHL-IHH-RHT transaction.

19. In response to this Hon’ble Court’s query regarding the proposalfor purging of contempt, the Petitioner has proposed certain reliefsagainst RHT including a notice to RHT. [SLP Vol 222/Page 6].

E. Religare

20. Mr. Krishnan Venugopal, Senior Counsel, made extensive oralsubmissions on behalf of the Petitioner in reply to the argumentsmade by Mr. C.U. Singh, Senior Advocate, appearing for ReligareEnterprises Limited, Religare Comtrade Limited and ReligareFinvest Limited (“Religare Group”). The Religare Group has soughtvacation of the order dated 05 April 2019 passed by this Hon’bleCourt in SLP thereby staying the insolvency proceedings against23 entities before the National Company Law Tribunal, Delhi.

21. Mr. Venugopal relied on his rebuttal submissions [SLP Vol 220]and convenience compilation [SLP Vol 209]. Further, reliance wasalso placed on the application for additional documents [SLP Vol211] where he highlighted that the order passed by SEBI on 14March 2019 had, in fact, been revoked by order dated 12November 2020. The submissions made by Mr. Venugopal, in anutshell, were as follows: (i) Religare Group has not initiatedinsolvency proceedings against eight out of the nine entities whoselands have been offered for sale; (ii) the lands acquired by these companies were acquired mostly before 2010, whereas ReligareGroup gave loans only in 2016-2018 and therefore, Religare Group’sloans could not possibly have been used to acquire those lands;(iii) entities in Religare Group are not decree holders and aretherefore not entitled to share in any amounts recovered pursuantto the present proceedings, which proposition has been settled inthe facts of this case itself by the High Court of Delhi as well asby this Hon’ble Court; and (iv) since Religare Group’s insolvencypetitions are admittedly premised on fraud, they must not bepermitted to be admitted.

22. During the course of closing submissions on behalf of thePetitioner, Mr. Rakesh Dwivedi, sought a continuance of the stayorder dated 05 April 2019 as it has a direct bearing on the outcomeof the present Contempt Petition. It was submitted on behalf ofthe Petitioner that, in the absence of continuation of this order, theassets that may be utilized for the purging of contempt committedby the Singh Brothers will become subject to insolvencyproceedings thereby jeopardizing the process of purging ofcontempt. [SLP Vol 222/Page 7].

F. Miscellaneous

F. Miscellaneous

23. Withdrawal of INR 17,93,40,000 deposited by Contemnor Nos.1- 8 (IHFL and IVL, and its directors) (“Contempt Deposit”) incompliance with the direction contained in paragraph 51 (i) of theContempt Judgment. Mr. Jaideep Gupta, Senior Advocate, madesubmissions on behalf of Daiichi on 12 May 2021. He submittedthat the Petitioner is entitled to receive the Contempt Depositand, hence, it should be permitted to withdraw the ContemptDeposit, as prayed for in IA No. 50764 of 2020 in the ContemptPetition. [SLP Vol 91].

24. The Contempt Deposit was made as a result of thecontemptuous conduct of the contemnors that has severelyaffected the interest of the Petitioner. No third parties can claim ashare in the deposit made by a party committing contempt ofprotective orders passed in favour of the Petitioner. Further, theseare monies deposited in contempt proceedings and Section 73 ofthe Code of Civil Procedure, 1908 is not applicable in theseproceedings.”

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A19. In support of the contention that IHH / NTK be directed toput the funds back in FHL,it was submittedthat matter raised followingquestions:

“(i) Whether Fortis Healthcare Limited/ IHH etc. in remitting thesum of approximately INR 4000 crores on 15 January 2019 haveBviolated the status quo order dated 14 December 2018, and thuscommitted contempt?

(ii) Whether INR 4000 crores should be brought back by IHHand deposited with Fortis Healthcare Limited?

(iii) Whether the deposit of INR 4000 crores, if directed to beCmade, could be utilized to honour the undertakings recorded andrepresentations made on various occasions before the Delhi HighCourt and this Hon’ble Court?

The additional questions raised during the hearing on 12 May 2021,and submissions made by Mr. Datar on behalf of the PetitionerDare set out below:

Additional Q. No. 1: Whether the submissions on tort ofconspiracy and the theory of attribution were made in theabsence of pleadings?

(a) A specific plea regarding conspiracy was made by the PetitionerEin para 97 of SMC Volume 26 at page 63. For ready reference,the paragraph is reproduced below:

“97. Given the large-scale conspiracy carried out by the banksand financial institutions in tandem with the Respondents, FHLand IHH, Daiichi Sankyo submits that it is only just and properthat FHL be required to make this amount of INR. 4000 croresavailable for Daiichi Sankyo in respect of the undertaking givenby its CEO and Managing Director on 21 June 2017. DaiichiSankyo further says and submits that until and unless FHLmakes available this amount for realization of the decretal sum,FHL/IHH should not be allowed to proceed with the OpenOffer or utilize the amount of INR 4000 lying in the escrowaccount for that purpose. “

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The award dated 29 April 2016 was against 19 respondents.Repeated assurances I undertakings were given to the Delhi HighHCourt that the total assets were in excess of INR 10,000 crores and that in any event, a sum of INR 2341.9 crores will always beavailable to satisfy the award I decretal debt. These undertakingswere on behalf of the entire group, including Fortis HealthcareLimited (“FHL”), as has been pointed out in written submissions[SLP Vol 185] and reiterated in these submissions. In I.A. No.9264 of 2018 was filed by Daiichi on 16 July 2018 in the DelhiHigh Court to stop the takeover of FHL by IHH. A reply dated2018 filed by R19 (RHC) inter alia that: “Given the group’sliabilities, including the award .... “. Thus, the award is equally theliability of FHL, as it is of other group companies of the SinghBrothers.

(b) The manner in which the shareholding of Fortis HealthcareHolding Private Limited (“FHHPL”) in FHL was reduced from71.1 % to 0.66% was in complete violation of eight undertakingsgiven to the Delhi High Court and to the Supreme Court and couldnot have been done without the active knowledge of the banksand IHH.

(c) Apart from specific pleadings, the conspiracy is also revealedfrom the extensive pleadings in these matters and the role of thefollowing entities:

(i) Banks, which gave large amount of loans to group companiesof the Singh Brothers without any scrutiny on end utilization ofthe loans (this has been explained by Mr. Rakesh Dwivedi, SeniorAdvocate)

(ii) FHL and IHH Healthcare Berhad, in transferring INR 4000crores in violation of the status quo order and to frustrate thedecree.

(iii) RHT Health Trust, Singapore, in participating in the transactionof receipt of INR 4000 crores from FHL and IHH, beingtransferred out of India in violation of the status quo order dated14 December 2018. This was done while Mr. Gurpreet SinghDhillon (maternal cousin of Singh Brothers) was the signatoryand at the helm of the affairs of RHT.

(d) Theory of attribution: It is a settled principle that acts ofdirectors, who are in management and control, are deemed to beacts of a company which is a legal entity but has no mind or bodyto think and act. It is well settled that the acts of the directors in AB

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Acontrol are attributable as the acts of the company and treated assuch. There are extensive pleadings which show that the groupcompanies, including FHHPL and FHL, were under themanagement and control of the Singh Brothers. Thus, the theoryor principle of attribution applies. Undertakings by the SinghBrothers are undertaking of the group companies, including and,Bin particular, that of FHL.

Additional Q. No.2: Whether this Hon’ble Court can issuedirections in addition to imposing any punishment forcontempt?

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C(a) This Hon’ble Court has the power to punish for contemptunder Article 129 of the Constitution of India. Willful breach of anundertaking given to a court is a civil contempt under section 2(b)of the Contempt of Courts Act, 1971. Further, the doing of “anyother act whatsoever” which “interferes with or tends to interferewith, or obstructs or tends to obstruct the administration of justiceDin any other manner” is a criminal contempt under section 2(c)(iii)thereof.

(a) The Contempt of Courts Act, 1971 only provides for imposingpunishment for contempt of court. But the contempt jurisdictionof this Hon’ble Court enables not only imposition of punishmentEbut granting relief by way of restitution. The judgment of thisHon’ble Court in Delhi Development Authority v. SkipperConstruction[3 ]makes it amply clear that the court can giveappropriate directions for remedying and rectifying the things donein violation of its orders.

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(b) A reference can also be made to the decisions in s[4], whichheld that this Hon’ble Court can take cognizance even for violationof orders of the High Court. (This was overruled on another pointin Supreme Court Bar Association v. Union of lndia[5]).

G(c) At stake in the present case is the sanctity and validity ofundertakings given to the Delhi High Court and the Supreme Court.

3(2007) 15 SCC 60 I - For text, see SMC Vol 36, P 227-251 on para 24-28.

4(1995) 2 scc584, 602-603 (paras 22 and 23).

5(1998) 4 SCC 409 - the Supreme Court could not remove an advocate’s name from theHrolls of the State Bar Council.

If these can be violated with impunity, it will be a serious setbackto the rule of law and the image and the prestige of the superiorjudiciary in India. It is humbly stated that it should be made clearthat if an undertaking is violated, particularly in the context ofgroup companies, the High Courts and the Supreme Court havesufficient power under Articles 129 and 215 to pass whateverdirections are necessary to ensure that the undertakings arefulfilled.

Additional Q. No. 3: If FHL/ IHH is directed to bring backINR 4000 crores, whether Petitioner will be entitled torecover the award/ decretal amount from these funds?

(a) In the answer to Question No.2 of the earlier writtensubmissions [SLP Vol 185/Page 9], submissions have been madeas to why it is imperative that INR 4000 crores should be broughtback. The extraordinary and unseeming haste in sending INR4000 crores outside India was in breach of the status quo order ofthis Hon’ble Court dated 14 December 2018. It is well settledthat any act in violation of court’s order is void and the status quoante must be restored. [(i) Satya Brata Biswas v. Kalyan Kumar[6]and (ii) Vidur lmpex and Traders Private Ltd. v. Tosh apartmentsPrivate Ltd.[7]].

(b) If the sum of INR 4000 crores is brought back, it will be anasset in the books of accounts of FHL. This will be like any otherasset ofFHL namely lands, buildings, investments, cash account,cash in bank, etc., and can be attached to fulfill the undertakinggiven.

(c) As pointed out in detail later in this additional written submission,there were multiple undertakings given by the Singh Brothers andjudgment debtors that the award will be binding on the groupcompanies.

(d) The first undertaking in the execution proceedings (on 24 May2016) was given only to ensure that the listed entities, primarilyFHL, Religare, etc. remained unaffected. Further, undertakings were also given to ensure that no prejudice was caused to FHL

6(1994) 2 SCC 266 (para 23 and pages 106-117 of SMC Vol 36.

7(2012) 8 SCC 384 (para 49. page 118-150 of SMC Vol 36.

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which was a flagship company.

(e) There is no dispute that FHHPL and FHL are part of thegroup companies on whose behalf the undertakings were given.Thus, even though these two companies are not the judgmentdebtors in the arbitral award, the obligation to ensure that theaward is satisfactorily complied with is upon all these groupcompanies including FHHPL and FHL.

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(f) At the time of the first undertaking, the Singh brothers held71.7% ownership directly and indirectly in FHL through FHHPL.They were in control of the management of FHL. The undertakingsthat were given to prevent of the award, execution has directlyenured to the benefit of FHL whose business operations continuedwithout any hindrance.

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(g) The undertakings given by Singh Brothers are thus binding onFHL as well. These undertakings, given at the time when theyDhad more than 71 % control, would be binding even after theirFHL shareholding was reduced. It is submitted that an undertakinggiven to the court by a person or persons who are majorityshareholders, will continue to bind that company even if theirshareholding is subsequently reduced to a minority. This isEparticularly important when such shareholding is reduced inviolation of assurances and undertakings to a court.

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(h) In Rosnan Sam Boyce v. B.R. Cotton Mills Ltd.,[8] it was heldthat the undertaking given by the person in management and control,will be the undertaking of the company itself. In the same way,Fthe undertaking given by the Singh Brothers would equally bindFHL. The systematic attempt to frustrate the undertaking shouldnot be permitted. In the B.R. Cotton Mills case, it was held thatunder Article 142, the court could do complete justice and that theundertaking given by the director was an undertaking by the firstrespondent company would be treated as having committedGcontempt. In the same way, FHL may be equally bound by theundertaking.

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(i) Thus, the undertakings I assurance that a sum of INR 2341. 9crores will always be available for satisfaction of the award amount H8(1990) 2 SCC 636, (para 7, 8, 9 at page 58-60 of SMC Vol 36)

will also be an undertaking on behalf ofFHL. Once theundertakings were given on behalf of the group and was beenmade amply clear that FHL was the most valuable member ofthis group/ single economic entity, the undertakings are binding onall the entities on whose behalf the undertaking was given. Daiichiwill be entitled to recover the amount by attaching assets of anyof these entities, including FHL as well.

(j) FHL cannot escape liability on the ground that it is a listedentity or that Singh Brothers along with their investment companieshad less than 1 % shares of FHL on the date on which INR 4000crores was sent out. IHH, the new investor in FHL and now incharge of the management of FHL, had full knowledge of thevarious undertakings given to the High Courts and the SupremeCourt. IHH and its directors cannot now escape the liability tohonour the understandings I assurances by taking shelter underthe concept of separate corporate personality. The assets ofFHLare liable to be attached in execution of the award at the presentmoment as they would be when the Singh brothers were m controland gave the undertakings / assurances.

(k) If FHL is permitted to evade liability, then undertakings can begiven on behalf of a group of companies and these will be renderedmeaningless if a new management takes over or there are newshareholders who have a majority.”

20. On behalf of Contemnor No.9 – Malvinder Mohan Singh, itwas submitted that the transactions in question were entered into innormal course of business andthere was no attempt on part of thecontemnors to put the assets beyond the reach and control of Daiichi. Itwas submitted that whatever the Noticees, banks and financial institutionsdid was pursuant to the transactions entered into well before theassurances / undertakings were given to the High Court and this Court.Inhis attempt to purge himself of contempt, Contemnor No.9 submittedthat certain properties held by his relations and Companies under thecontrol of his group could still be proceeded against.The details of suchproperties given in the written submissions, were as under:

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1082SUPREME COURT REPORTS

[2022] 11 S.C.R.

ALoan extended by Loan extended to Amount Cumulative (Rs. amount Crores)(Rs. Crores)Gurinder Singh Dhillon 1.57 223.15 Gurkirat Singh Dhillon 88.78 1. Modland Wears Private Gurpreet Singh Dhillon 79.71 Limited Nayan Tara Dhillon 0.61 Shabnam Dhillon52.48B2. Devera Developers Private Gurkiran Singh Dhillon65.47122.62 Limited Gurpreet Singh Dhiilon 57.16 Gurkirat Singh Dhillon 101.91 292.5 Gurpreet Singh Dhiilon 110.81 3. Fern Healthcare Private Sanjay Godhwani 1.92 Limited Sunil Godhwani68.60Prime Trust4.19CLuminous Holdings Pvt. 5.07 Ltd. 4. Best Healthcare Private Gurkirat Singh Dhillon103.37207.15 Limited Gurpreet Singh Dhiilon103.785. Adept Lifespaces Private Gurkirat Singh Dhillon 85.58 152.88 Limited Gurpreet Singh Dhiillon 67.30 Total998.3

D21. It was submitted by Contemnor No.10 – Shivendra MohanSingh that he was neither involved in the management nor in thenegotiations or talks in respect of any of the transactions entered intowhich was seriously being questioned. According to said Contemnor, itwas his brother namely Contemnor No.9, who was completelyEresponsible for all said transactions.

22. As the record shows, the bulk of the shareholding held byFHHPL in FHL was pledged with YES Bank Ltd. (YBL) and AxisBank Ltd. (ABL). Mr. Shyam Divan, learned Senior Advocate advancedsubmissions on behalf of these two entities and took us through variousFdocuments placed on record.

The preliminary submissions advanced on behalf of YBL were asunder:

“7. The crux of YBL’s case is that 8,97,81,906 FHL shares wereencumbered in favour of YBL, by 28.07.2016. Out of theG8,97,81,906 FHL shares, 5,41,35,500 FHL shares were encumberedunder various agreements, prior to 30.03.2016. A further 2,65,02,852FHL shares were encumbered under agreement to pledge dated30.03 .2016. Thus, prior to the date of the arbitral award(29.04.2016), a total of 8,06,38,352 FHL shares were encumberedin favour of YBL. Subsequently, on 28.07.2016, i.e. after the ‘First H

Assurance’ by the Judgment Debtors (before the Hon’ble DelhiHigh Court in OMP EFA 6 of 2016) and prior to the Second andThird assurance, a further 91,43,554 FHL shares were encumberedunder another agreement to pledge. Therefore, by 28.07.2016,8,97,81,906 FHL shares were encumbered in favour of YBL, priorto the second to fifth assurances given by the JDs before theHon’ble Delhi High Court. These 8,97,81,906 FHL shares weresold only pursuant to this Hon’ble Court’s Order of 15.02.2018.(Pg.1, Vol 200)

8. It is pertinent to reiterate that YBL was never a party beforethe Hon’ble Delhi High Court when the assurances were givenby the JDs. Furthermore, YBL was not even a party to thecaptioned SLP filed against the Order dated 21.06.2017 passedby the Hon’ble Delhi High Court. YBL was also not aware of thecontents of the affidavits being filed by the JDs nor was it awareof the nature of the assurances being given by the JDs to theHon’ble Delhi High Court. (Para 47, Pg. 34, Vol 173)

9. Admittedly, FHHPL is not a judgment debtor qua Daiichi.Further, the Orders of the Hon’ble Delhi High Court and thisHon’ble Court make it clear that there was no injunction qua theshares of FHL held by FHHPL at any time prior to 11.08.2017.There was also no restriction on lending to the JDs or their groupcompanies at any point of time. In fact, even the Hon’ble DelhiHigh Court vide its judgment dated 15.10.2020 passed in EA No.615, 625 and 815 in OMP EFA 6 of2016 (order upheld by thisHon’ble Court) (“15 October 2020 Judgment”) has categoricallyheld that there was neither any restriction on lending to the JDsnor was there any injunction qua the JDs assets till 19.02.2018.The Hon’ble Delhi High Court’s reasoning was based on thepremise that the foreign arbitral award in favour of Daiichi becamea decree only on 31.01.2018, after Daiichi’s enforcement petitionwas allowed, in terms of Section 49 of the Arbitration andConciliation Act, 1996. (Paras 49 to 52, Pg. 37, Vol 173)

10. Further, all allegations of collusion between the JDs and YBLfor the purpose of defeating Daiichi’s rights are completelyincorrect, meritless and baseless, and are unsupported by anyevidence. This is also evident from the fact YBL has severalrecovery proceedings pending against the JDs and the borrowers A

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before various forums for an outstanding amount of INR 532.9Crore (excluding interest) (as of 22.02.2021). (Paras 43 to 46,Pg. 33, Vol.173)

11. Moreover, there were contemporaneous public disclosuresmade by FHL / FHHPL with the stock exchange concerning theSubject Encumbrances, thereby negating the argument that theseencumbrances/ pledges were being created in a discreet andcollusive manner. Additionally, it also appears that JD Nos. 14and 19, in their affidavit of unencumbered assets dated 14.03.2017had mentioned that 5 crore unencumbered shares of FHL held byFHHPL would be kept aside for repayment of debt obligations ofthe group companies (Para 4, Pg. 254, Vol 2, Pg. 444, 455, Vol 6).Furthermore, admittedly, neither the JDs nor Daiichi had everinformed YBL that there was any restriction on either lending tothe JDs or their group companies post 24.05.2016, nor was YBLinformed of any injunction existing qua the FHL shares or anyother assets of the JDs’ or their group companies. Moreover,FHHPL, under the various pledge agreements executed with YBL,also gave a representation that there was no litigation pendingqua the FHL shares. (For eg., Clause 4.l(o), Pg. 439, Vol 175)This shows that it was a well-accepted position among the differentstakeholders including Daiichi that there was no such injunction /restriction qua the FHL shares, prior to 11.08.2017. (Paras 43 to46, Pg. 33, Vol 173)

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12. Therefore, there is absolutely no legal basis to nullify YBL’ssubject loan and security agreements executed between24.05.2016 and 11.08.2017. Thus, to hold YBL, a bona-fideFsecured creditor, accountable for certain unilateral assurancesgiven by the JDs to the Hon’ble Delhi High Court, would be atravesty of justice.”

Similarly, preliminary submissions advanced on behalf of ABL wereas under:

G

“7. The crux of ABL’s case is that 1,36,50,000 FHL shares wereencumbered in favour of ABL under various agreements prior to29.04.2016 (the date of the arbitral award in favour of Daiichi).Further, a total of2,58,50,000 FHL shares were encumbered infavour of FHL by 15.12.2016 which is even prior to the secondH(23.01.2017) and third assurances (6.03.2017) given by the IDs to the Hon’ble Delhi High Court (Tranches 1 to 9, @Pgs. 1 to 5Vol. 197).

8. Contrary to Daiichi’ s claim, after the third undertaking, thetotal encumbrance in favour of ABL in fact reduced to 1,83,75,000FHL shares from previously held 2,58,50,000 shares. Thus, as of11.08.2017, ABL had in its favour an encumbrance over 1,83,75,000FHL shares. These encumbrances were invoked only pursuant tothe Supreme Court’s Order of 15.02.2018 (Pgs. 9, 10 Vol. 197).

9. It is pertinent to reiterate that ABL was never a party beforethe Hon’ble Delhi High Court when the assurances were givenby the JDs. Furthermore, ABL was not even a party to thecaptioned SLP filed against the Order dated 21.06.2017 passedby the Hon’ble Delhi High Court. ABL was also not aware of thecontents of the affidavits being filed by the JDs nor was it awareof the nature of the assurances being given by the JDs to theHon’ble Delhi High Court. (Para 43, Pg. 26, Vol 167)

10. Admittedly, FHHPL is not a judgment debtor qua Daiichi.Further, the Orders of the Hon’ble Delhi High Court and thisHon’ble Court make it clear that there was no injunction qua theshares of FHL held by FHHPL at any time prior to 11.08.2017.There was also no restriction on lending to the JDs or their groupcompanies at any point of time. In fact, even the Hon’ble DelhiHigh Court vide its judgment dated 15.10.2020 passed in EA No.615, 625 and 815 in OMP EFA 6 of2016 (order upheld by thisHon’ble Court) (“15 October 2020 Judgment”) has categoricallyheld that there was neither any restriction on lending to the JDsnor was there any injunction qua the JDs’ assets till 19.02.2018.The Hon’ble Delhi High Court’s reasoning was based on thepremise that the foreign arbitral award in favour of Daiichi becamea decree only on 31.01.2018, after Daiichi’s enforcement petitionwas allowed, in terms of Section 49 of the Arbitration andConciliation Act, 1996. (Paras 45 to 48, Pg. 27 to 30, Vol. 167)

11. Further, all allegations of collusion between the JDs and ABLfor the purpose of defeating Daiichi’s rights are completely baseless,and are unsupported by any evidence. This is also evident fromthe fact ABL has several recovery proceedings pending againstthe JDs and the borrowersbefore various forums for an outstandingamount. As stated in its compliance affidavit, even today there is AB

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approximately an outstanding amount of INR 624 Crores (approx.)as of22.02.2021. (Paras 39 to 42, Pg.25, Vol 167)

12. Moreover, there were contemporaneous public disclosuresmade by FHL / FHHPL with the stock exchange concerning theSubject Encumbrances, thereby negating the argument that theseBencumbrances were being created in a discreet and collusivemanner. Additionally, it also appears that JD Nos. 14 and 19, intheir affidavit of unencumbered assets dated 14.03.2017 hadmentioned that 5 crore unencumbered shares of FHL held byFHHPL would be kept aside for repayment of debt obligations ofthe group companies (Para 4, Pg. 254, Vol 2, Pg. 444, 455, Vol 6).CFurthermore, admittedly, neither the JDs nor Daiichi had everinformed ABL that there was any restriction on either lending tothe JDs or their group companies post 24.05.2016, nor was ABLinformed of any injunction existing qua the FHL shares or anyother assets of the JDs’ or their group companies. This showsthat Daiichi was also well aware that that there was no suchDinjunction / restriction qua the FHL shares, prior to 11.08.2017.(Paras 39 to 42, Pg. 25, Vol 167).

13. Therefore, there is absolutely no legal basis to nullify ABL’ssubject loan and security agreements executed between24.05.2016 and 11.08.2017. Thus, to hold ABL - a bona-fideEsecured creditor - accountable for certain unilateral assurancesgiven by the IDs to the Hon’ble Delhi High Court, would be atravesty of justice.”

23. Mr. Harish N. Salve, learned Senior Advocate advancedsubmissions on behalf of the IHH/ NTK. It was submitted that theshareholding held by FHHPL in FHL was not in any way transferred inFfavour of IHH/ NTK but what was allocated to IHH/ NTK wassubscription of fresh shares. The money so put in by way of capitalintothe company was then utilized by FHL for streamlining its businessstructure. It was submitted that under an antecedent arrangement, theproprietary interest in the hospitals and diagnostic centres was held byGRHT, a trust set up in Singapore and those assets were being utilized byFHL for its business purposes; and in return FHL was paying a hugeamount of money by way of lease rentals. The liability to pay theselease rentals was affecting the financial health of FHL considerably andas such a decision was taken by the management to gain a proprietaryinterest in said assets rather than continue under the lease arrangement.HIt was for the purpose of acquisition of such proprietary interest that the amount of Rs.4,666/- crores was transferred by FHL in favour of RHTTrust. These transactions were completely bona fide and entered intofor the purposes of securing and protecting the business structure andinterest of FHL. In the written submissions the concerned events wereset out as under:

“2. As explained below, the events that took place were as follows:

(a) Daiichi had initiated an arbitration against the Singh Brothersand others in relation to allegations of fraud in the sale of theirshares of Ranbaxy Ltd. It is pertinent to note that the presenttransaction has no connection with that transaction.

(b) Having secured an award in their favour, the Decree Holderthen took to enforcing the award in India. In the course of theseenforcement proceedings, undertakings were given on behalf ofthe Singh Brothers to the Hon’ble Delhi High Court that theywould not alienate their assets. At some point, the Decree Holderalso carried the matter to this Court, and undertakings were alsogiven in this court by the Decree Holder to the same effect.

(c) It appears that in the meantime since there was a fall in thevalue of the shares of FHL, the banks from whom loans had beenobtained against the security of the shares, invoked pre existingpledges. In the petition for leave to appeal filed by the DecreeHolder, initially on 11 August 2017, this Hon’ble Court injunctedthe banks from encashing any pledges. This order however cameto be modified on 15 February 2018 when this court clarified thatthe injunction would relate only to pledges created after 11 August2017.

(d) Upon the modification of the order, the bankers who nowbecame entitled to enforce the pledges took steps to transfer theshares to themselves or their nominees including the sale of theshares, and this caused a drastic fall in the shareholding of theSingh Brothers in FHL.

(e) By March 2018, the shareholding of the Singh Brothers inFHL had dropped to below 1 %. The Singh Brothers also resignedfrom the Board of Directors of FHL. The new shareholdersnominated professional directors and professional managementto run the affairs of FHL.

(f) The financial condition of FHL was precarious and that is whythe board of FHL decided to induct fresh capital to salvage thecompany. This was done by a public process inviting bids from A

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interested parties. The highest premium was quoted by IHHHealthcare Berhad (“IHH”) and it is through this process thatNTK (100% indirectly owned subsidiary of IHH) came tosubscribe to shares issued by FHL.

A

(g) This transaction of issuance of shares was consummated by13 November 2018, i.e., prior to the Stay Order of 14 December2018. However, as a consequence of the acquisition of sharespursuant to the investment of ` 4000 crores (at ` 170 per share,with a premium of around 20% above the prevailing market price)which was by way of a preferential allotment under the ShareSubscription Agreement dated 13 July 2018 between NTK andFIIL (“Share Subscription Agreement”). [SMC Compilation/Vol.15/Page 410-4 71] and NTK became obliged to make a public offerto acquire the shares of such of those (it members of the publicwho would like to exit FHL.

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(h) The consequence of the order of injunction passed on 14December 2018 is to render this process of acquisition of sharesDof the members of the public in an Open Offer (as defined below)under a freeze. It is submitted that the injunction is not servinganybody’s purpose and in fact, is contrary to the interests of thepublic shareholders. The only interest the Decree Holder has inpursuing this course of action is to try to pressurize IHH to payEthem their decretal dues, for the reason that the prospects ofrecovery from the Singh Brothers (who are already in jail fornon-payment) appear to be bleak.”

D

24. In its response to the submissions made on behalf of theContemnors regarding purging of Contempt, following submissions weremade on behalf of Daiichi:

F

“A. Judgment Debtors

1. As sought by the contemnor MMS in (and as proposed in) I.A.No.43119 of 2020, this Hon’ble Court may direct a forensic auditof the group companies of MMs and SMS identified in Vol. 90/Table A/pages 4 and 5 and the companies and individuals towhich loans have been advanced by the judgment debtors andassociate companies as set forth in Vol. 90/Table B/pages 6and 7. Extracts from I.A. 43119 of 2020 describing Table ‘A’ andTable ‘B’, are annexed herewith as Annexure “P-1”. The SCmay also direct forensic audit of entities (indirectly owned andcontrolled by MMS and SMS) which are registered outside India.

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An illustrative list of such entities is annexed herewith as Annexure“P-2”.

2. The SC may also direct a forensic audit of all the concernedcompanies that borrowed from banks and financial institutions(Dion Global Solutions Limited, Ligare Aviation Private Limited,Ligare Voyages Private Limited, Ranchem Private Limited, ANRSecurities Private Limited, RHC Holding Private Limited, OscarInvestments Limited, Fortis Healthcare Holding Private Limited(“FHHPL”), RWL Healthworld Limited and Religare CapitalMarkets International Mauritius Limited) and for which the sharesof Fortis Healthcare Limited (“FHL”) owned by FHHPL werepledged from time to time, including where top-ups with respectto the pledges were made, in violation of the orders andundertakings given to the Hon’ble Delhi High Court (“DHC”)and the SC. A list of borrower entities is annexed herewith asAnnexure “P-3”.

3. As per MMS and SMS, the following assets are available forsale to purge a part of the contempt:

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4. In addition to the aforesaid land parcels, MMS and SMS havealso stated that the following brands/trademarks are available forsale to purge a part of the contempt:

5. As per SMS, an amount of US$ 10.89 million is available withLigare Voyage (Ireland) Limited. Accordingly, this Hon’ble Courtmat by pleased to direct the Contemnors deposit this amount, i.e.,US$ 10.89 million held by Ligare Voyages, with this Hon’ble Court[Vol. 88/Page 7,9,33]

6. The request for the aforesaid sale of lands/properties given byMMS and SMS should be considered favorably by this Hon’bleCourt, and a retired judge of this Hon’ble Court may be appointedto undertake this sale process in a time-bound manner.

B. Banks

7. Banks and financial institution who have created additionalpledges or exercised right of top-ups after 24 May 2016 (i.e., thedate of the first assurance) have been instrumental in the systematicdilution of the FHL shares owned by FHHPL. The JudgmentDebtors have deliberately pledged the shares in relation to (andas collateral for) dubious loans extended to the various groupcompanies of FHL (owned and controlled by the Singh Brothers).Eight banks and financial institutions (Axis Bank, Yes Bank, RBLBank, ECL Finance Limited, First Abu Dhabi Bank, Indiabulls,Aditya Birla Finance Limited and Lakshmi Vilas Bank) have engaged in this reprehensible conduct and, as per the share priceas on 11 May 2021, the vale of the shares pledged after 24 May2016, is approximately and amount of INR 2859,45,32,748/- (Thatis, Indian Rupees Two Thousand Eight Hundred Fifty-Nine CroresForty-Five Lakhs Thirty-Two Thousand Seven Hundred Forty-Eight Only).

Banks and financial institution who have created pledges orexercised right of top-ups after 24 May 2016 (i.e., the date of thefirst undertaking), should be directed to deposit the equivalentamounts with this Hon’ble Court. This Hon’ble Court may alsodirect that the money being deposited by the banks and financialinstitution is pursuant to the exercise of its contempt jurisdictionand, therefore, any and all monies if so directed to be deposited topurge the contempt can only be released in favour of Daiichi whohas suffered as a result of the contemptuous acts. A table ofpledges created (after 24 May 2016) by each bank and the totalvalue is annexed as Annexure “P-4”.

8. DCB Bank, HDFC Limited and Citi Corp Finance (NoticeeNos. 12, 10 and 13 respectively) have not appeared before thisHon’ble Court despite service of the notice on them. This Hon’bleCourt should cancel the pledges created by them on the shares ofFHL as owned by FHHPL in violation of the court orders andthey should be directed to deposit the equivalent amount with theHon’ble Court. [Vol.210/Page 82]

9. This Hon’ble Court may direct RBL Bank to deposit a sumequivalent to the value of 4,20,000 shares of FHL i.e., approx.,INR 9,88,89,000 (Indian Rupees Nine Crores Eighty-Eight LakhsEighty-Nine Thousand Only) which were injuncted from beingtransferred or sold by order dated 15 April 2021 of the SC.

10. While Indiabulls sold 12,25,000 shares of FHL in violation ofthe orders of the SC and has been held guilty for this, it has alsosold 9,04,760 shares during the period of 05 September 2018 – 21September 2018 I gross violation of orders of this Hon’ble Court.Therefore, the SC should direct Indiabulls to deposit an amount ofINR 21,30,25,742 (Indian Rupees Twenty-One Crores ThirtyLakhs Twenty-Five Thousand Seven Hundred and Forty-TwoOnly), which is an amount equivalent of the value of these shares AB

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(as on 11 May 2021). No separate suo motu contempt proceedingsare required.

11. Axis Bank still retains 90,00,000 shares of FHL and theseshares must be directed to be sold and the monies so realizedmust be deposited with this Hon’ble Court.

B

12. There was an unlawful top-up of shares by banks of:

(i) 5,00,000 shares by First Abu Dhabi Bank on 31 May 2017(Approx. value: INR 11,74,00,000 (Indian Rupees Eleven CroresSeventy-Four Lakhs Only)); and

(ii) 1,10,00,000 shares by Axis Bank on 30 November 2016(Approx. value: INR 11,77,25,000 (Indian Rupees Eleven CroresSeventy-Seven Lakhs Twenty-Five Thousand Only)).

C

First Abu Dhabi Bank and Axis Bank should therefore be directedto deposit the aforesaid amounts equivalent to the value of theshares which were unlawfully topped-up in blatant violation oforders of the DHC and the SC.

D

13. This Hon’ble Court may allow Daiichi Sankyo to withdrawINR 17,93,40,000 deposited by Indiabulls on 18 November 2019in compliance with the directions in the judgment dated 15November 2019. Daiichi has filed I.A. No.50764 of 2019 seekingEwithdrawal of these monies. [Vol.91]

C. Fortis Healthcare Limited

14. By their undertaking as recorded in DHC’s order dated 21June 2017, Respondents/Judgment Debtors had assured that asum of INR 2341.90 crores will always be available andrealizable to satisfy the Award dated 29 April 2016. At this juncture,the Singh Brothers were the Chairman and the Managing Directorof FHL.

F

15. Daiichi Sankyo has the right to recover the amount of INR2341.90 crores from FHL because FHL is also subject to andbound by the undertakings given from time to time by the SinghBrothers. By the theory of attribution, the undertakings/representations/assurances made from time to time are as if theyhave been (and, indeed, should be deemed to have been made byFHHPL and FHL, both of whom (although there are not judgment G

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debtors) form part of the Fortis Group. It is submitted that FHL isas bound by the assurances/undertakings given eight timesbecause, inter alia, the Singh brothers were the directing mindand will of FHL.

16. FHL and IHH have violated the order dated 14 December2020 of this Hon’ble Court by transferring an amount of INR4000 crores (that is, Indian Rupees Four Thousand Crores) outsideIndia to RHT Trust, Singapore. This amount should be broughtback and deposited with this Hon’ble Court. This Hon’ble Courthas initiated suo moto contempt action against FHL in this regard.FHL, IHH and NTK must be directed to deposit this amount withthis Hon’ble Court.

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D. RHT Trust

17. Notice of contempt to be issued to RHT Trust and its followingofficials; D

(i) Tank Kang Fun-CEO/CFO-Trustee Manager; and

(ii) Gurpreet Singh Dhillon – former CEO and ExecutiveDirector of the RHT Trust and a close relative of the SinghBrothers.

This Hon’ble Court may direct RHT Trust and GurpreetESingh Dhillon to explain their roles in:

(i) the transfer of INR 4000 crores by FHL to RHT Trust inbreach of the order dated 14 December 2018 of the SC:

(ii) the further transfer of the monies to RHT’s unitholders(including directly/indirectly members of the Dhillon familyand the Singh Brothers) which was also in violation of theorder dated 14 December 2018. This transfer involved afurther transfer of INR 817 crores to FHL (as a unitholder);and F

(iii) the execution of definitive agreement dated 13 FebruaryG2018 between FHL and RHT for the buy-back of RHTportfolio assets based on the term sheet dated 14 November2017 and disclosure to the SGX dated 15 November 2017that resulted in the transfer of a controlling stake in FHL toIHH. This was in breach of the assurances given to theDHC and the status quo order of this Hon’ble Court.H

AE. Religare

1. Any IBC proceeding should be subject to the outcome of thecontempt proceedings and orders passed by this Hon’ble Court.

2. No IBC proceeding should be admitted against the judgmentdebtors, Fern Healthcare Private Limited, Modland Wears PrivateLimited and ANR Securities Private Limited.

B

3. This Hon’ble Court may reserve the right of Daiichi Sankyo toraise all the arguments raised before this Hon’ble Court and theNCLT may be directed to examine all arguments without prejudiceto any arguments under Section 65 of the IBC.

C

4. The proceedings against 23 entities initiated by Religare FinvestLimited, if permitted, will directly impact the outcome of thecontempt proceedings.”

25. In the backdrop of these submissions, following questions arisefor our consideration: - D

(a) Whether the acts of commission or omission on part ofContemnor Nos.9 and 10 and the entities controlled by them,were calculated to put the assets of the companies undertheir control beyond the reach of Daiichi?

E(b)Having given clear assurances to the High Court and thisCourt, whether such acts of commission and omission onpart of Contemnor Nos.9 and 10 amount to contempt of theorders passed by the High Court and this Court?

(c) Whether the banks and financial institutionssold the sharesFwhich were pledged with them, purely as a matter ofcommercial expediency or whether there was any deliberateact of defiance to defeat the rigour and width of the orderspassed by the High Court and this Court?

(d) Whether the acts committed by them were in connivancewith Contemnor Nos.9 and 10?

G

(e) Whether the transactions entered into by or with IHH/ NTKwere bona fide or whether there was a deliberate attemptto defeat the processes of Court and thereby keep the assetsbeyond the reach of Daiichi?

H

26. The first two questions raised hereinabove need no furtherelaboration as the conduct of contemnor Nos.9 and 10 was consideredand they were held guilty of having committed contempt of the orderspassed by the High Court and this Court. While holding them guilty, byits judgment and order dated 15.11.2019 this Court had given them anopportunity to purge themselves of contempt. Therefore, insofar as therole played by Contemnor Nos.9 and 10 is concerned, the matter rests ina narrow compass i.e., whether they have purged themselves of contemptor not? The kind of assets that have been offered by said ContemnorNos.9 and 10 in their affidavit are so inadequate that it is impossible tosatisfy the amount awarded in favour of Daiichi in the foreign arbitralaward. We are, thus, left with no alternative but to hold that saidContemnor Nos.9 and 10 have failed to purge themselves of contempt.As a matter of fact, there is no genuine attempt on their part. The questionthen comes up is about the quantum of sentence. Considering the enormityof their actions, in our view, the maximum sentence that can be awarded,must be imposed. We, therefore, sentence them to suffer six monthsimprisonment andimpose fine of Rs.5,000/- for having committedcontempt of court with default sentence of two months.

27. That takes us to the next set of questions regarding the roleplayed by the noticee banks and financial institutions. With the assistanceof the learned counsel appearing for the parties we made an attempt togo through the documents placed on record but find ourselves unable tocome to a definite conclusion whether there were antecedentarrangementswhich enabled said banks and financial institutions to keepattaching the shares and keep on converting large quantity of sharesfrom the compartment of “unencumbered shares” to that of “encumberedshares” and thereafter keep disposing of said shares. We are also unableto come to a clear conclusion whether all those actions were protectedby the order dated 15.02.2018 passed by this Court enabling the banksand financial institutions to sell encumbered shares.

This exercise will require going into issues of fact, comparing ofthe documents and accounts as well as considering the expediencywhether the shares were required to be sold in order to keep affordingcomfort and sufficient security to said banks and financial institutions.

28. It is true that it is possible for a court, while exercisingjurisdiction in contempt, to pass consequential orders in the nature ofsequestration orders to secure the properties which the contemnor had AB

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Aput beyond the reach of the court or which were acquired by thecontemnor for himself or for any other person or entity by his wrongfulacts. But there are two difficulties to undertake such exercise in contemptjurisdiction in the present matter. First, these noticees were not partiesto the initial proceedings in this Court. Secondly, they have come up witha defence that all their acts were purely commercial in nature and it wasBthe expediency of the situation which demanded such actions on theirpart. These issues need to be gone into at the appropriate stage(s).Butbefore reacting that level, a factual analysis in the form of forensic auditassuggested by Daiichi is also required to be undertaken. Such exercisewill certainly help the court in arriving at an appropriate conclusion andCin passing appropriate orders or directions. We, therefore, refrain frompassing any directions against said banks and financial institutions forthe present but observe that the executing court or any other authoritycompetent to exercise such power shall do well to appoint forensicauditor(s) to undertake proper exercise to unravel the truth.

D29. Insofar as the issues concerning the acquisition of proprietaryinterests in hospitals and diagnostics centers at a price of Rs.4,666 croresby FHL is concerned, facts on record are not quite adequate to enterinto such arena. Prima facie, it appears to be acquisition of proprietaryinterest to subserve the business structure of FHL as suggested by IHH/NTK. But again, that is a matter to be enquired into and facts to beEassessed in the light of any forensic analysis, if the court so deemsappropriate.

30. In the premises we pass following directions:

(a) Contemnor Nos.9 and 10 are sentenced to suffer six monthsFimprisonment and pay fine in the sum of Rs.5,000/- each withinfour weeks from today. In case of default of payment of fine, thecontemnors shall undergo further imprisonment of two months.

(b) Special Leave Petition (Civil) No.20417 of 2019, ContemptPetition No.2120 of 2018 in SLP(C) No.20417 of 2019 and SuoGMotu Contempt Petition (C) No.4 of 2019 are disposed of with adirection to the High Court, before whom the proceedings inexecution are pending, to consider appointment of forensicauditor(s) to analyse the transactions entered into by the noticeebanks and financial institutions and to look into whether suchtransactions were bona fide and entered into in commercialHexpediency.

(c) The executing court may also consider issuing appropriateprocess and appointing forensic auditor(s) to analyse thetransactions entered into between FHL and RHT and other relatedtransactions.

(d) The amount of Rs.17,93,40,000/- which stands deposited inthe Registry of this Court shall be transmitted to the executingcourt along with interest accrued thereon. The said amount shallbe available to the executing court while considering execution ofthe instant foreign arbitral award.

(e) Certain shares which are still lying with the noticee banks andfinancial institutions, for example, the shares of FHL pledged withand continued to be held by RBL Bank which were dealt with inthe order dated 15.04.2021 passed by this Court,shall be availableto the executing court and shall abide by such order as theexecuting court may deem appropriate to pass.

(f) All the properties offered by Contemnor Nos.9 and 10 in theirattempt to partially purge themselves of contempt shall also beavailable to the executing court and shall abide by such directionsas the executing court may deem appropriate to pass.Consequently, there shall be attachment of all those assets whichmay await the decision or direction to be passed by the executingcourt in due course of time which may also include the questionswhether the assets in question apparently in the names of certainpersons/ entities can be proceeded against.

(g) Needless to say that it shall be open to the executing court topass such directions as the facts and circumstances presentedbefore it may justify.

(h) All pending proceedings before the concerned courts, includingthe First Information Reports and proceedings before NCLT shallbe taken to logical conclusion in accordance with law.

(i) The Registry shall send copies of all volumes, submissions andpleadings filed by the parties in the instant matters to the executingcourt for facility and record.

Directions issued.

A

B

C

D

E

F

G

H