Bhushan Infrastructure Private Limited Vs Union of India Through Finance Secretary (Delhi High Court)
Delhi High Court held that IFCI Limited (Lender) is required to release the shares from the pledge as and when the loan is repaid by the borrower. Accordingly, Court directed IFCI to release the pledge within a period of six weeks.
Facts- There was an Agreement for Pledge of Shares between M/s Bhushan Infrastructure Private Limited (petitioner) and IFCI Limited (respondent No.3). Such agreement was reduced in writing on 18.06.2014 and as per the recitals appearing in the abovesaid agreement, petitioner had approached and requested IFCI Limited (lender and pledgee) to sanction a corporate loan to the extent of Rs.25 crores. IFCI Limited agreed, in principle, to sanction the abovesaid loan. As per the terms and conditions of the pledge agreement, petitioner created a security by way of pledge of 15,06,932 number of equity shares which it held and which had been issued by M/s Bhushan Steel Limited.
According to petitioner, since the loan amount has been duly refunded and there was no subsisting obligation under the abovesaid loan facility of Rs.25 crores, IFCI Limited was under a legal obligation to return the abovesaid pledged shares immediately as per the abovesaid agreement but these were not released by them.
