The bank wanted the court to direct Koticha to deposit around Rs 379 crore from the proceeds from the sale of its stake in group flagship ASK Investments to private equity major Blackstone.
In August, Singapore-based BCP Topco XII Pte Ltd, an investment vehicle of Blackstone, entered into a share purchase agreement with Koticha to acquire its majority stake in ASK Investment Managers Ltd.
“I have no doubt that the balance of the facility is not with the plaintiff (Yes Bank),” the court said in its 17-page order. “The bias that is likely to be caused by one or more of the many defendants far outweighs any potential prejudice to the plaintiffs.”
Justice GS Patel, in his order of September 24, has now adjourned the hearing of the matter till November 29.
The origin of the dispute lies in the Rs 330 crore credit facility given by Yes Bank in 2015 to Lilly Realty Pvt Ltd, a company owned by Asit Koticha. At the time of securing the loan facility, Koticha had extended ‘shortfall security’ under which if the realty firm fails to clear its dues to Yes Bank, it will pay the shortfall.
Later, Lilly Realty was classified NPA in February 2020.
Law firm ABH Law’s managing partner Munaf Virji and senior advocate Ravi Kadam, appearing for Asit Koticha, declined to comment.
A mailed query to Yes Bank did not elicit any response. Rohan Dakshini, partner, Rashmikant & Partners, who appeared along with senior advocate Dinyar Madan for the bank, also did not comment.
On August 30, 2021, Yes Bank issued a deficiency demand notice to Koticha to meet the shortfall of over Rs 379 crore. When Koticha refused, the bank approached the court.
Koticha agreed to sell its majority stake to BCP Topco at Rs 707 per share, taking the total to over Rs 606 crore. However, out of this amount, Rs 307 crore and Rs 145 crore will be paid to IIFL Wealth Prime and IDBI Trusteeship respectively under various debt obligations.
Yes Bank’s lawyers argued that whatever is left after paying both IIFL Wealth Prime and IDBI Trusteeship should be kept in an escrow account or deposited in the court.
However, contesting this, Koticha, through his lawyers, argued that it was nothing but a suit for recovery.
“It cannot be that the attachment is obtained against here (High Court) before the judgment and the final relief sought is to be obtained in the Debt Recovery Tribunal (DRT) against Lilly Realty and possibly against the personal guarantor. As against Koticha as well,” argued Koticha’s counsel.