written arguments presented by Mr. Mody on 11-3-2003 in city civil suit5827/2001 hearing

Written arguments on 11-3-03






(1) Dhanyushya First created charge in August 1998 for Rs

11.0 crores and only then issued notice calling for

statutory records from plaintiff. This shows ulterior motive

to grab ownership titles.

(2) It needs to ne noted that Mr. Jalundhwala cannot create

Charge on the assets of Rupmanglam and Flovin when he

did not have necessary statutory records to pass

resolution for any transfer of ownership of shares, change

in directorship, change in registered office, approval of

balance sheet, approval of creation of charge etc.

(3) When Bank-Defendant had written to Core Health Care

On 3-8-1999, it appears that they were not satisfied with

The independent report letter dated 31-7-1999 and this

Contradicts with the statement filed by the bank-

defendants.

(4) The fact that defendant did not make payment from

Flovin - Textile Traders Bank Account totaling Rs 74.00

Lacs to Bank of India in 1997 means that their conscience

knew fully well that they were not the sole directors of

Flovin as claimed by them on the basis of alleged

resignation to have taken place on 22-4-1996.

(5) Serious doubts on quality of vigilance inquiry conducted

by signatory of the letter dated 21-10-1999 Mr. S.R.

Krishnmurthy , head of Global Trust Bank’s Branch when

He was sacked by the bank as per the press reports.


(6) The defendant Bank has only obtained Auditor’s report

from M/s Shah & Shah (Contents not known) but has not

obtained Auditor’s report from Kashiparekh & Associates,

Auditor of Rupmanglam and Flovin while creating charge.

This shows collusion with defendants no 1 to 3.

(7) It needs to be observed that Bank has relied on documents

Between Dhanyushya and Suresh Modi executed on

24-7- 1995 which forms 19% share in property only. It has

not obtained original documents for balance 81%

belonging to Rupmanglam and Flovin to create charge.

Besides, defendants 1 to 3 have deliberately not furnished

The said documents and this shows collusion with Bank.


(8) As the defendant No 1,2 had disputes pending regarding

Flovin, there was no need for Mr. Jalundhwala to

Subsequently accept alleged resignation on 17-9-1996 in

case of plaintiff for Rupmanglam.


(9) Provision of Chapter XX_C of the Income Tax Act clearly

Stipulates that 37-I permission is absolutely essential even

When one makes attempt to acquire property by transfer

Of shares. Such transfer of property is void and illegal.


(10) Plaintiff is of firm opinion that this is fit case to initiate

Contempt proceedings as defendant no 1 to 3 has failed to

Hnonor the promise made by them to the court

Commissioner and when they did not disclose such

Promise to the High Court.


(11) Defendant 1 to 3 has malafide intention of not furnishing

Evidence of ownership especially when such documents,

Information must have been filed by them while seeking

Amalgamation from the High Court and thereby illegal

Acts do not get exposed.


(12) When the defendant bank cannot take strong legal actions

Against the defendat 1,2,3 for not furnishing even simple

Evidence of minutes, balance sheet, transfer of shares

Called for in the suit means that they are in collusion with

The defendants.


(13) Dhanyushya while approaching Gujarat High Court has

Not stated that Mr. Soparkar appearing as Counsel

Happens to be one of the escrow person in the M.O.U.

Between the parties. This shows malafide intention to

Challenge the orders passed by the Civil Court with an

Intention to veil their illegal acts.


(14) The defendants 1,2,3 till date has given only denial

Statements, but they have not been able to furnish report

of compliance from the escrow persons consiststing of

Mr. Soparkar and Mr. Kashiparekh adducing original

Share certificate, transfer deed, letters of resignation,

Minute book records which clearly means that the escrow

Persons as well as the auditors do not want to confirm their

Alleged claim of directorship,ownership of shares,

ownership of property to support creation of charge.


(15) It needs to be observed that when Court has asked then to

Adduce evidence of ownership, except for denial

Statements they have not furnished any concrete evidence

Of ownership of shares, ownership of Rupmanglam

property so as to pass necessary resolution to create

charge.


(16) It needs to be observed that defendant 1,2,3 has not

Furnished any evidence to support their claim of

Directorship, and alleged resignations. It is only defendant-

bank who furnishes such information.


(17) The appropriate authority of Income –Tax has raised issue

Of 37-I in respect of Rupmanglam and Flovin by writing

Letter to plaintiff in his capacity of directorship of these

Two companies. Grave legal complications to plaintiff

and others can arise on account of such letters.






(18) Dhanyushya and Core Health Care documents filed in

the Income-Tax department were located in Insuarance

Building, Ashram Road, where fire took place on 29th

April 2002 and 10th December 2002. This has to be seen

In the light of non-cooperation to the Court

Commissioner and immediately approaching High

Court where direction was given to give reply on 26th

April 2002 and in light of letter addressed to Auditors

Of Dhanyuhsya on April 17, 2002 and posted on April

20 , 2002 and also in light of article which appeared in

Indian Express on 7th December, 2002 regarding great

Bank robbery on 7th December 2002 which revealed

Name of defendant 2 & 3. It is therefore, absolutely

Necessary to call for all evidences in the interest of

Justice and put the documents under aval japti to

prevent any further legal complications.









(19 ) Dhanyushya has no locustandi in the matter at the

Moment as they have given charge to the Bank. It is only

when Core HealthCare redeems the payment, then only

they can come into picture as they only own 19% share

in the property while 62% share in the property is not

owned by them.

(20) Jalundhwala can claim to continue as director only if legal

Share holder of the company him to act as director, and it is

Legal share holder who would authorize legal director to

Create charge.

(21) It is specifically referred in letter addressed to Global Trust

Bank on 24-7-1999 that as per record of right ,

Rupmanglam EXCLUSIVELY OWN CONSTRUCTION

While charge created by Dhanyushya and Flovin depict

That the construction alos belong to Dhanyushya and

Flovin. This is reflected in Form-8 filed with Registar of

Companies. Such creation of charge is void ab-initio.


(22) The question of limitation is mix question of fact and law.

Therefore, it cannot be decided at the interlocutory stage

Even otherwise the pleading of plaint contemplate that the

Suit is within limitation.





Honourable Court may please to allow the injunction

Application.



DATE 11=3=-03 -----------------------
AHMEDABAD