Court receiver was given prints of upcoming film

MUMBAI: In an order that legal experts say sends out strong signals to erring film producers, the Bombay high court has appointed a court receiver to take charge of all prints and negatives of Sher, a Bollywood film that is still under production.

The appointment of a receiver is to ensure that a nearly year-old consent award which requires producers of Bol Bachchan, Shree Ashtavinayak Cine Vision, to pay Rs 41 crore to its financier, Yash Tejpal Shah.Ashtavinayak and its managing director Dhilon Mehta have paid "minor amounts of Rs 5.3 crore only" of the Rs 41 crore, noted Justice Roshan Dalvi in her September 18 order. A consent award in October 2011 had made it clear that a lien was created in favour of the financier on income to be received by Ashtavinayak from various films it would produce. The payment was to be made in installments by June 30, 2012 or by September 30 if Ashtavinayak showed that its upcoming film was 30% complete. Any default in payment would render the entire amount payable at once. Three instalments later, the defaults began.

Ishwar Nankani, advocate for Ashtavinayak, and Mehta argued that the consent term was satisfied but produced no receipts in court. Rajeev Narula, advocate for Shah, pointed out that cheques issued by Ashtavinayak were dishonoured.

The HC observed that a case had been made out for appointing a receiver for Ashtavinayak's other film.

Meanwhile, the owner of satellite rights for Sher argued that once a receiver takes charge of the film's prints, it would become "as much a victim" as financier Shah. The court was told that rights of Sher were transferred to another producer, but Narula said this was done only to defeat the agreement with the financier. Senior counsel Aspi Chinoy said that Rs 36 crore was the balanace payable to Shah when Ashtavinayak and Mehta confirmed that Sher was their film and had a certificate affirming that from the film's distributer. The judge agreed and observed that Ashtavinayak's claim that it would not benefit financially from Sher's release was a "collusion to defeat claims of the creditors".

The judge directed that prints of Sher remain in the custody of the court receiver till Shah is paid the balance amount. The judge also ordered Ashtavinayak and Mehta not to sell or dispose of their shares in another company till they pay Shah his dues.

Print Page