Authority: High Court of Judicature at Bombay (Civil Appellate Jurisdiction)

Order Date: 3 September 2026 (pronounced) – Reserved on 25 June 2026

Case Overview

  • Parties: Petitioners – M/s. Kuber Mutual Benefits Ltd. & Ors.; Respondents – State of Maharashtra & Ors., CIDCO, and the Court Receiver. The Valuer is M/s. AT & TS Associates, represented by proprietor T. K. Sinha. An Amicus Curiae, Mr. Sharad Bansal, assisted the Court.
  • Background: The writ petition (No. 3661 of 2001) challenged attachment of properties under the Maharashtra Protection of Interest of Depositors (in Financial Establishments) Act, 1999. On 1 December 2003 the Court ordered the Court Receiver to inspect the properties, invite offers for sale “as‑is‑where‑is”, and explore completion of construction. The Court Receiver engaged AT & TS Associates as a Panel Valuer to inspect the sites and prepare valuation reports for five properties (CBD Belapur, Sector 4 Kharghar, Sector 11 Kharghar, Sector 10 Vashi, Village Pahur, Raigad) and a status report.
  • Valuer’s Claims: Six bills were raised on 15 May 2004 totaling Rs 7,01,858 (inclusive of service tax). After removal of the service‑tax component, the revised principal claim became Rs 6,51,062. The Valuer also claimed simple interest at 6 % per annum for 21 years (May 2004‑May 2025), amounting to Rs 8,20,338, bringing principal + interest to Rs 14,71,400. Additionally, applying a Cost Inflation Index multiplier of 3.21238, the Valuer sought an inflation‑linked enhancement, raising the total claim to Rs 47,26,710.
  • Procedural History: The writ petition was disposed on 5 September 2005, but the Valuer’s fees remained unpaid. Repeated communications (2005‑2018) by the Court Receiver to the petitioners’ advocates sought deposit of the fees. Court Receiver’s Report No. 126 of 2010 asked the Court to direct payment limits (Rs 5,000 for inspection bill, Rs 25,000 ceiling per valuation) and to order the petitioners to deposit the fees plus Rs 10,000 costs. That report remained pending and was never listed for hearing. Subsequent communications (2014‑2018) failed to secure a hearing. The suit account held no funds and was in debit of Rs 684; only Rs 500 had been deposited initially by Ms. Clare Gonsalves.
  • Legal Issues: (i) Which fee‑guidelines govern the Valuer’s claim – the 1994 Guidelines (valuation for sale) or the 1999 Guidelines (royalty/compensation)? (ii) Whether the Rs 25,000 ceiling applies per property or to the whole assignment. (iii) Whether interest is payable and at what rate. (iv) Whether an inflation‑linked enhancement may be awarded alongside interest.
  • Amicus Submissions: Mr. Bansal argued that the 1994 Guidelines apply because the assignment was for valuation of immovable property in aid of sale. He interpreted Clause 9 to require Court sanction only before payment of amounts exceeding the ceiling, not before appointment. He contended the ceiling must be applied separately to each property and that interest at 6 % (as claimed) is permissible, but a further inflation‑linked enhancement would constitute double compensation.

Final Outcome

  • The Court held that the 1994 Guidelines govern the assignment. The Rs 25,000 ceiling is to be applied separately to each valuation report.
  • The revised principal claim of Rs 6,51,062 is sanctioned in full.
  • Interest at 6 % per annum on the principal for the period May 2004‑May 2025 is awarded, amounting to Rs 8,20,338. Simple interest will continue to accrue at 6 % per annum on the principal from 1 June 2025 until actual payment.
  • The claim for an inflation‑linked enhancement (multiplier 3.21238) is rejected as it would duplicate the compensation already provided by interest.
  • The Valuer is directed to lodge the sanctioned claim of Rs 14,71,400 (principal + interest) together with future interest before the Official Liquidator, Uttar Pradesh and Uttarakhand, which has been designated by the Allahabad High Court to handle the liquidation of “Petitioner No. 1 – Company”.
  • The Court Receiver is discharged without passing accounts; the suit account may be closed without further costs. The Court Receiver shall forward the order, valuation reports, and revised invoices to the Official Liquidator within three weeks.
  • The Court declined to implead Rowena Sharma or to freeze assets of companies associated with her, citing lack of substantive material establishing personal liability.
  • The Court emphasized the need for administrative mechanisms to ensure professional fees of court‑engaged experts are identified and paid promptly to avoid decades‑long delays.

Topics: Professional Fees, Valuation, Insolvency