Companies

ED to court: Cannot agree to sale of shares seized from United Breweries

Krishnaprasad Bengaluru | Updated on January 27, 2018 Published on April 26, 2017

BL27_NEWECO_KINGFISHER

Court asks Official Liquidator ‘not to precipitate’ the matter during further hearings

The Enforcement Directorate on Tuesday informed the Karnataka High Court that it cannot agree to the sale of shares seized from the possession of United Breweries (Holdings) Ltd, till the conclusion of the confiscation proceedings against businessman Vijay Mallya and the conclusion of the trial under the Prevention of Money Laundering Act.

A written statement in this regard was submitted before a Division Bench comprising Chief Justice Subhro Kamal Mukherjee and Justice PS Dinesh Kumar during the appeal filed by UBHL against the order for winding up the company.

ED’s Special Public Prosecutor S Mahesh said in the written statement that “in view of the fact that the ED had reasons to believe on the materials in their possession that the appellant [UBHL] was in possession of proceeds of crime, they had initiated attachment proceedings as per Section 5(5) of the Act, which has been confirmed by the Adjudicating Authority.”

Under these circumstances, the statement said: “The ED is not empowered to permit the sale of attached properties, which are shares in this case, in favour of the appellant for any purpose, much less for the purpose of selling it and to disburse the sale proceeds to its debtors or the same to be deposited before the court.”

While requesting the court to reject UBHL’s plea to sell the shares, the ED stated that “severe harm and injury” will be caused to the directorate, whereas no such harm or injury will be caused to UBHL.

Following this, the Bench directed the Official Liquidator, who is set to take charge of UBHL based on the order for liquidation, not to precipitate the matter while further hearing the appeal after the court’s summer vacation in June.

UBHL had proposed to deposit the amount realised by selling the seized shares, before the court.

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Published on April 26, 2017
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