On Monday, the High Court of Bombay upheld the order of the Metropolitan Magistrate at Ballard Pier, Mumbai, under which Venugopal Dhoot, Director of Videocon Industries, was ordered to deposit Rs. 6.75 crore under way of provisional reward in a check bouncing case.
The Bench of Justice RP Mohite-Dere issued a notice of appeal and retained the challenged order until the next hearing date.
Dhoot had reached the High Court seeking to set aside the order handed down by the Court of Justice in the search bouncing proceedings launched by the Bank of Maharashtra.
The court order ordered Dhoot to deposit 20 % of the overall sum (Rs. 33.75 crore) referred to in the check supposed to have been disheartened by Videocon.
Senior Advocate Abad Ponda, appearing for Dhoot, argued that his client was just the designated signatory of the search issued by Videocon, and that he was not the 'drawer' of the check.
Ponda relied on the judgments of the Supreme Court to contend that it was Videocon Industries that was needed to make the payment, as ordered by the court, and not the Director of the company.
Dhoot 's motion, filed by Advocate Akash Menon, alleged that, after the admission of insolvency proceedings against Videocon by the National Corporate Law Tribunal (NCLT) in 2018, Mumbai had been named a specialist resolution (RP) to handle the company's financial and administrative affairs.
The RP will also represent the company in the litigation pending before the Metropolitan Magistrate, as the High Court has been told.
Bank of Maharashtra also raised a claim with the RP for the recovery of the sums owing to it. Thus, the plea insists that there was no need for any interim compensation to be charged.
The plea explained that, after the election of the RP, the Board of Directors had been dissolved and all the financial and administrative matters of the company had been passed to the RP. In the light of the move, Dhoot has no influence over Videocon 's finances.
The dishonoured check was reported to have been issued by Videocon as one of several blank checks on the 'Working Capital Term Loan' carried out with the Bank of Maharashtra.
Videocon allegedly released the checks to satisfy the Bank's unilateral demand, and the checks were not provided as protection against the loan.