SC orders ISSL to release MF units worth Rs 344 cr to Dalmia Cement

By: |
March 18, 2021 4:30 AM

It has also asked the Dalmia Bharat group to file an application before trial court for release of its MF units, which were allegedly stolen by Allied Financial Services Private (AFS) in early 2019.

It also clarified that the 2019 interim order shall continue to operate as it was as against the other parties.It also clarified that the 2019 interim order shall continue to operate as it was as against the other parties.

The Supreme Court has asked IL&FS Securities Services (ISSL) to release mutual fund units worth `344 crore to Dalmia Cement (Bharat) subject to the cement manufacturer providing appropriate bank guarantee (BG) of same value to the satisfaction of the trial court.

It has also asked the Dalmia Bharat group to file an application before trial court for release of its MF units, which were allegedly stolen by Allied Financial Services Private (AFS) in early 2019.

While modifying its interim order of August 27, 2019, to the extent that the Dalmia Bharat’s MF units kept with ISSL be released and credited in its demat account by way of transfer, a bench led by Justice Mohan N Shantanagoudar said “this is subject to the applicant (Dalmia Bharat) furnishing requisite BG of equivalent value as the MF units to the satisfaction of the trial court. The applicant shall comply with this requirement within one month of filing of application for release of MF units before the trial court, which shall also dispose of such application expeditiously,” the apex court stated.

It also clarified that the 2019 interim order shall continue to operate as it was as against the other parties.

The Dalmia Bharat group had sought modifications of the SC’s August 27, 2019 interim order to the extent that its securities be returned to it as it was the lawful owner. Seeking a direction to National Security Clearing Corporation (NSDL) to release/transfer MF units, which had matured on June 27, 2019, by crediting the same in its demat account, it had also submitted that it was capable of abiding by the terms and conditions of the securities and such other orders that may be passed by the SC in its favour as it was financially sound company.

Dalmia had alleged that AFS had fraudulently and unauthorisedly transferred MF units from the demat accounts of its two subsidiaries – OCL India (OCL) and Dalmia Cement East (DCEL) and placed them as security with ILSS as collateral for Allied’s own transaction – margin obligations. It had also lodged a complaint in February 2019 with Sebi and also with the Economic Offences Wing, Delhi Police (EOW) against Allied, ISSL, NSDL and their officials.

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