SHAKTI NATH Vs ALPHA TIGER CYPRUS INVESTMENT NO. 3 LTD
Bench: HON'BLE MR. JUSTICE UDAY UMESH LALIT, HON'BLE MS. JUSTICE INDU MALHOTRA, HON'BLE MR. JUSTICE HEMANT GUPTA
Judgment by: HON'BLE MR. JUSTICE UDAY UMESH LALIT
Case number: C.A. No.-001674-001674 / 2020
Diary number: 23489 / 2017
Advocates: ABHAY KUMAR Vs
IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.1674 OF 2020 (Arising out of SLP(C)No.22038/2017)
SHAKTI NATH & ORS. …Appellants
ALPHA TIGER CYPRUS INVESTMENT NO.3 LTD. & ORS. …Respondents
O R D E R
1. The present Appeal has been filed to challenge an award
passed in an ICC arbitration with its seat in New Delhi.
The Appellant has challenged the judgment dated
08.05.2017 passed under Section 37 of the Arbitration and
Conciliation Act, 1996 (“Act”), whereby a division bench of
the Delhi High Court rejected the Appeal.
2. The factual background in which the present Appeal has
been filed is as follows : -
2.1. The Appellant-Promoters entered into a Shareholders
Agreement (“SHA”) and a Share Subscription and
Purchase Agreement (“SSPA”) with Respondents No.1
and 2 both dated 21.03.2008 to acquire 50%
shareholding in Respondent No. 3 for the development
of a Special Economic Zone for Information Technology
and Information Technology Enabled Services. The
project was to be developed on a plot of land
admeasuring approx. 45,202 sq. mts. in NOIDA
(“Project Land”) which was allotted to one M/s Sarv
Mangal Real Tech Pvt. Ltd. (“M/s Sarv Mangal”). The
Project Land was sub-leased by M/s Sarv Mangal to
Respondent No. 3.
2.2. The SHA and SSPA were terminated. The parties
entered into a Restated Shareholders Agreement
(“RSHA”) and a Restated Share Subscription and
Purchase Agreement (“RSSPA”) both dated 02.07.2009.
As per Clause 3.3 and 3.4 of the RSSPA,
Respondents No. 1 and 2 were required to contribute
Rs.45 crore to purchase and subscribe the shares in
Respondent No.3, which was brought in by
2.3. The Appellants terminated both the agreements on
17.12.2009. The Respondents No. 1 and 2 invoked
arbitration, and submitted the Request for Arbitration
to the ICC Court under the RSHA and RSSPA.
2.4. The Tribunal vide its award (2:1) dated 20.01.2015
allowed the claim of Respondents No. 1 and 2, and
awarded the following : -
a) payment of Rs.45,00,27,747/- together with Simple
Interest @ 18% p.a. from 31.10.2011 to the date of the
b) payment of Simple Interest @ 15% p.a. on all sums
awarded to the claimants in the award, till the date of
c) the Appellants were not entitled to repayment of lease
rental paid to NOIDA from Respondents No. 1 and 2,
and the Respondent-Claimants were under no
obligation to share future lease rental;
d) the Appellant-Promoters were directed to pay costs of
the arbitration comprising of:
i. fees and expenses of the arbitral tribunal and the
ICC administrative expenses fixed by the ICC Court
for the total amount of USD 900,000;
ii. Rs.2,39,08,082/- towards the legal fees of the
iii. costs of the hearing venue in the amount of
iv. a sum of Rs.1,274,931/- in respect of other costs
and expenses of the Respondent - Claimants.
2.5. The Appellants filed objections under S. 34 of the 1996
Act before the Delhi High Court. The learned Single
Judge vide Order dated 09.02.2017 rejected the
challenge on merits, and held that it was an
undisputed fact that Respondents No. 1 and 2 had
brought in a sum of Rs.45,00,27,747/- for the project.
The Appellants had terminated the RSHA and RSPA
soon after the funds were brought in by Respondents
No. 1 and 2. The Court found the findings of the
arbitral tribunal to be consistent with the terms of the
2.6. Aggrieved, the Appellants preferred an Appeal under S.
37 of the Act before the Division Bench of the Delhi
High Court. The Division Bench vide judgment and
order dated 08.05.2017 rejected the Appeal as being
devoid of any merit.
3. The Appellants have challenged the Order passed under S.
37 of the 1996 Act by way of the present Special Leave
3.1. This Court vide interim Order dated 15.09.2017
directed the Appellants to deposit an amount of
Rs.20,00,00,000/- (rupees twenty crore) in the
Registry of this Court, which was directed to be
invested in a short-term fixed deposit account with a
nationalised bank. The Appellants were injuncted
from alienating the Project Land, so that in the
ultimate eventuality, if the award was sustained by
this Court, it could be realised from the sale of the
3.2. By a subsequent Order dated 01.05.2018,
Respondent No.1 was permitted to withdraw an
amount of Rs.10 crore unconditionally, from the
amount lying deposited in this Court.
3.3. By a further Order dated 14.11.2019, the Senior
Counsel for the Appellants requested for time to find a
suitable buyer for the Project Land. It was made clear
that the sale would be under the auspices of a public
authority or a court officer, and the entire sale
consideration would be deposited in the Registry of this
It was further directed that the balance amount of
Rs.10 crore along with the accrued interest, which was
lying been deposited in the Registry of this Court,
would be released to Respondent No.1.
The counsel for the Appellants made a request to
join NOIDA as a party to the present proceedings since
the Project Land was leased out by NOIDA.
Consequently, Notice was issued to implead NOIDA in
3.4. The Appellants filed an affidavit dated 05.12.2019
stating that the Project Land was free from any and all
encumbrances, and was not subject to any pre-existing
mortgage or charge.
It was further submitted that the Appellants were
able to identify a party which was interested to acquire
the sub-lease of the Project Land, viz. M/s. Good Living
Infrastructure Pvt. Ltd. (“Bhutani group”). The Bhutani
group had submitted their Expression of Interest to
acquire the sub-lease of the Project Land from NOIDA
by acquisition of shares of Respondent No. 3 for a total
consideration of Rs.99,44,55,000/-. The Bhutani
group was willing to deposit the sale consideration in
the Registry of this Court, after deducting the dues
payable to NOIDA. A copy of the Expression of Interest
dated 26.11.2019 was placed on the record of this
The Appellants further submitted that the balance
amount would be raised by mortgaging the property
situated at Industrial Plots No. 4 and 5, Block A, Sector
16, NOIDA, owned by Appellant No. 4, which is being
used as the Corporate Office.
The CEO of M/s Good Living Infrastructure Pvt.
Ltd. who was present in Court confirmed that his
Company stands by the offer of Rs 99,44,55,000/-
made by him before the Court.
M/s Good Living Infrastructure Pvt. Ltd. was
directed to file a Board Resolution along with an
affidavit to confirm the offer before the next date of
3.5. M/s Good Living Infrastructure Pvt. Ltd. through its
CEO/ Additional Director, duly authorized by a Board
Resolution dated 20.12.2019, filed an Affidavit dated
06.01.2020 before this Court to place on record its
Interest to acquire the sub-lease of the property
bearing Plot No.001B situated Sector 140A in NODIA
district Guatam Budh Nagar, U.P. admeasuring
45,202.50 sq. mts. held by M/s IT Infrastructure Park
Ltd. (Respondent No.3) for a consideration of Rs.
99,44,55,000/-. This would be effectuated by
acquisition of shares of Respondent No.3 which holds
the aforesaid property under a sub-lease executed
between NOIDA–the Lessor, M/s Sarv Mangal Real
Tech Pvt. Ltd.–the Lessee, and Respondent No.3–the
sub-lessee under Sub Lease dated 21.10.2009.
In the said Affidavit, Bhutani Group stated that it
is aware of the pending litigation before this Court, and
is willing to deposit the entire sale consideration with
the Registry of this Court, including the dues payable
3.6. With respect to the dues of NODIA, we requested the
Counsel for NOIDA to ascertain whether penal interest
on land rent and interest could be waived.
3.7. During the course of hearing on 22.1.2020, the dues
payable to NOIDA were crystallised as follows :-
(i) Pending Instalment amounts with
Simple Interest @ 14% p.a.
(ii) Lease Rent dues with Simple Interest
@ 14% p.a.
(iii)Time Extension charges Rs.6,57,38,900
(iv) Additional amount payable to land –
owners as compensation @ 64.7%
________________ TOTAL Rs.42,64,75,477
4. After having heard the Counsel appearing for all the parties,
the challenge to the ICC award is hereby rejected.
With respect to the amount awarded towards Interest
and Penal Interest under the award, the same has been
modified by consent of parties, as a prudent commercial
decision, in the following terms :-
i) The Appellants agree to make a total payment of
Rs.107.50 Crores (Rupees One Hundred and Seven
Crores and Fifty Lacs) to Respondents No. 1 and 2 as full
and final settlement of their dues under the award dated
ii) Out of the total amount of Rs.107.50 crores,
Respondents No.1 and 2 have already received an
amount of Rs.21,53,00,000/- (Rupees Twenty One Crore
FiftyThree Lacs) pursuant to the Interim Orders dated
01.05.2018 and 14.11.2019 passed by this Court.
The balance amount payable to Respondents No.1 and
2 would be Rs.85,97,00,000/- (Rupees Eighty Five Crore
Ninety Seven Lacs).
iii) M/s. Good Living Infrastructure Private Ltd. of the
Bhutani Group agreed and undertook to pay
Rs.99,44,55,000/- for the purchase of the entire
shareholding of Respondent No.3 - IT Infrastructure Park
Pvt. Ltd. from the Appellants and Respondents No.1
Out of this amount, Rs. 42,64,75,477/- would be
paid directly towards the dues of NOIDA. The Bhutani
Group would be at liberty to make a representation to
NOIDA within one week for re-schedulement as per its
prevailing policy, which would be decided within a further
period of one week.
iv) The balance sale consideration of Rs.56,79,79,523/-
(99,44,55,000 minus 42,64,75,477) would be deposited
by M/s Good Living Infrastructure in the Registry of this
Court. The deposit by M/s Good Living Infrastructure
would be made in 2 tranches :-
Rs.10,00,00,000/- Upfront payment to be deposited within 10
days of the passing of this Order.
Rs.56,79,79,523/- To be deposited within 6 months from the date of this Order.
The aforesaid amounts would be made over to
Respondent Nos.1 and 2 towards payment of the balance
v) The balance amount of Rs.29,17,20,477/- payable by the
Appellants to Respondents Ns.1 and 2 would be carried
out within a period of 3 months from the passing of this
vi) The orders of injunction dated 24.03.2017 and 17.08.2017
passed by the Delhi High Court restraining the Appellants
from alienating Industrial Plots No.4 and 5, Block A,
Sector-16, NOIDA is hereby lifted, to enable the Appellants
to raise funds for payment of the balance amount as stated
in para (ii) hereinabove.
5. The Appellants were directed to file an Affidavit of
Undertaking before this Court, with respect to the
obligations to be discharged as per the Consent Terms set
6. The Appellant No.1- Mr. Shakti Nath has filed an Affidavit of
Undertaking dated 10.02.2020 on behalf of all the
Appellants, stating that:
“1. I am the Petitioner No.1 in the above mentioned Petition and
am filling this affidavit on behalf of all Petitioners. Petitioners
No.2 and 3 are my wife and son, respectively, and the
Petitioner No.4 is a private limited company of which I am the
Managing Director and 96.26% shareholder while the
remaining shareholding is held by the Petitioners No.2 and 3,
2. Under the kind supervision of this Hon’ble Court, the parties
have agreed to settle the dispute forming part of the present
Petition at a total settlement amount of Rs.107,50,00,000/-
(Rupees One Hundred Seven Crore Fifty Lakhs Only). It has
further been agreed that the Respondent No.3 will be
purchased by way of purchase of its entire shareholding from
the Petitioners and the Respondents No. 1 & 2 by Good Living
Infrastructure Pvt. Ltd. (“GLI’), for Rs.99,44,55,000/- (Rupees
Ninety Nine Crore Forty Four Lakhs Fifty Five Thousand only),
out of which an amount of Rs.42,64,75,477/- (Rupees Forty
Two Crore Sixty Four Lakhs Seventy Five Thousand Four
Hundred Seventy Seven Only) or thereabouts shall be paid to
NOIDA directly by GLI towards payments of dues to NOIDA
as determined by this Hon’ble Court. The balance amount of
Rs.56,79,79,523/- (Rupees Fifty Six Crore Seventy Nine
Lakhs Seventy Nine Thousand Five Hundred Twenty Three
only) shall be deposited by GLI with this Hon’ble Court for
payment to the Respondents No.1 & 2.
3. Of the total settlement amount of Rs.107.50 Crores, the
Respondents have already received an amount of Rs.21.53
Crores from the Registry of this Hon’ble Court, which
comprises the amount of Rs.20 Crores deposited by the
Petitioners pursuant to the order dated 15.09.2017 of this
Hon’ble Court, along with the interest accrued thereon. Thus,
the total amount now payable to the Respondents No.1 & 2
comes to Rs.85.97 Crores. Since the Respondents No.1 & 2
will receive an amount of Rs.56,79,79,523/- from GLI, there
will be a shortfall of Rs.29,17,20,477/- (Rupees Twenty Nine
Crore Seventeen Lakhs Twenty Thousand Four Hundred
Seventy Seven only) approximately, which will be deposited
by the Petitioners with this Hon’ble Court.
4. The Petitioners undertake to deposit the above mentioned
shortfall of Rs.29,17,20,477/- or thereabouts within 3 months
of the lifting of the status quo upon their immovable properties,
which has been ordered by the Hon’ble Delhi High Court by
its orders dated 24.03.2017 and 17.08.2017 passed in
Execution Petition bearing OMP (ENF) (COMM) No.45 of 2017.
The said status quo is required to be lifted in order to enable
the Petitioners to raise loan against the said immovable
properties so as to enable them to deposit the shortfall amount
with this Hon’ble Court.
5. The Petitioners hereby undertake that till such time that the
entire settlement amount is paid to the Respondents No.1 &
2, the Petitioners shall not create any third party rights or
interest over the above mentioned immovable properties for
the purpose of raising loans to deposit with this Hon’ble Court
the amounts payable to the Respondents No.1 & 2 as per the
settlement reached between the parties."
7. M/s Good Living Infrastructure Pvt. Ltd. (“GLI”) has also
filed an Affidavit of Undertaking dated 10.02.2020 stating
“1. I am the CEO/Additional Director of M/s Good Living
Infrastructure Pvt. Ltd. (“GLI”) and have been duly
authorized by GLI vide Resolution of Board of Directors
dated 20.12.2019 to give the present undertaking on its
2. That GLI undertakes to pay a sum of Rs.99,44,55,000/-
towards the purchase of entire shareholding of IT
infrastructure Park Pvt. Ltd. (Respondent No. 3) from the
Petitioners and Alpha Tiger Cyprus Investment No.2 Ltd.
and Alpha Tiger Cyprus Investment No.3 Ltd. in order to
acquire the sub lease of the property bearing Plot No. 001B
situated at Sector 140A in Noida, District Gautam Budh
Nagar, Uttar Pradesh.
3. That out of total sum of Rs.99,44,55000/-. GLI undertakes
to pay the dues payable to NOIDA, amounting to
Rs.42,64,75,477/-, directly to NOIDA. In this regard, GLI
seeks liberty from this Hon’ble Court to approach NOIDA for
reschedulement of payment of the above mentioned sum.
GLI undertakes to make the appropriate representation/
application to NOIDA for such reschedulement within one
week of the receipt of the order passed by this Hon’ble
Court granting the liberty sought herein.
4. That GLI undertakes to deposit the balance purchase price
after deducting the NOIDA dues therefrom with the Hon’ble
Court i.e. an amount of Rs.56,79,79,523/-, in the following
Rs. 10,00,00,000/- Upfront deposit to be made with the
Court within 10 days of the signing of
the Share Purchase Agreement
between all the Parties, which shall
also be deposited in the custody of
the Hon’ble Court.
Rs. 46,79,79,523/- To be deposited within a period of
four months with an additional grace
period of two months after the
passing of the final order by the
5. It is prayed that the balance amount of Rs.46,79,79,523/-
be distributed to Alpha Tiger Cyprus Investment No.2 Ltd.
and Alpha Tiger Cyprus Investment No.3 Ltd by this
Hon’ble Court after the transfer of the entire shareholding
of Respondent No.3 to GLI.
6. I say that the above mentioned undertaking is voluntary
8. In the event of any default in payment of the amounts by
Appellants, the entire amount awarded as per the award
dated 20.01.2015, would become enforceable. However,
prior to enforcement, a window of 2 months would be
granted to the Appellants to make provision for compliance.
On the expiry of the aforesaid period of 2 months, the entire
decree would become executable forthwith.
9. M/s Good Living Infrastructure Pvt. Ltd. is bound by the
unconditional undertaking submitted on Affidavit before
this Court. Any default by M/s Good Living Infrastructure
Pvt. Ltd. would be treated as a breach of the undertaking
submitted to this Court.
The present Appeal is accordingly disposed of as per
the aforesaid Consent Terms.
Pending applications, if any, stand disposed.
..….…….....................J. (UDAY UMESH LALIT)
…..….........................J. (INDU MALHOTRA)
New Delhi; February 18, 2020.