Karachi October 13 2021: The Hascol Petroleum Limited is prohibited from transferring the shares held by it in the following companies together with any bonus and right shares (1) Hascombe Lubricants (Pvt.) Ltd, (2) VAS LNG (Pvt.) Ltd and HASCOL Terminals Ltd as per decision announced by Sindh High Court.
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The Hascol Petroleum Limited is prohibited from withdrawing or transferring the credit balances of its bank accounts maintained with the banks amounting to PKR 1.68 billion and said banks are restrained accordingly.
Earlier the foreign judgment, the Mena Energy DMCC, a company incorporated in the UAE, has been awarded USD 9,500,000/- against the Hascol Petroleum Limited, a company incorporated in Pakistan. The Execution is filed at Karachi as the Hascol Petroleum has assets at Karachi.
The Settlement Agreement between the parties recognized that in order for the Hascol Petroleum Limited to make payment to the Mena Energy DMCC out of Pakistan, the Hascol Petroleum Limited would be required to obtain the SBP approval, and the Hascol Petroleum Limited undertook to use its best endeavors to obtain such approval.
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Recitals to the Settlement Agreement show that the parties were litigating under contracts of supply of gasoil and fuel oil where under shipments were made by the Mena Energy DMCC to the Hascol at Karachi. The foreign court seized of the case had split the trial into two parts, the first to determine liability between the parties, and the second to determine quantum of liability. The first part of the trial determined against the Hascol by judgment dated 16-02-2017 (reported as Mena Energy DMCC v. Hascol Petroleum Ltd. It was just before the second part of the trial that the parties came to an agreement on the quantum of the Hascol Petroleum Limited liability and the manner of its payment to the Mena Energy DMCC, i.e. the Settlement Agreement dated 19-01-2018, which was then modified by an Addendum dated 23-01- 2018.
Under the Settlement Agreement, the Hascol Petroleum Limited agreed to pay a sum of USD 9,500,000/- in full and final settlement of the Mena Energy claim pending before the foreign court, in four installments commencing from 19-05-2018 by remitting the same to the Mena Energy DMCC bank account at Dubai. In the meanwhile, the JD was to provide to the DH bank guarantees in PKR equivalent to each installment from a bank in Pakistan. The parties agreed to retain with an escrow drafts of four consent judgments duly signed by the parties, the first one being for USD 9,500,000/-, with the stipulation that if the Hascol does not pay the first installment or does not furnish the bank guarantee, then the entire amount of USD 9,500,000/- will immediately become due and owing, and the Mena Energy DMCC will be at liberty to present the consent judgment to the foreign court with the prayer to pass/seal the same and proceed to enforce it. Upon the execution of the Settlement Agreement the parties agreed to apply to the foreign court for a consent order to stay the case pending before it until the enforcement of the Settlement Agreement becomes necessary. The Hascol Petroleum Limited did not make any payment under the Settlement Agreement, nor did it provide the agreed bank guarantees. Therefore, the Mena Energy presented the draft of the first consent judgment of USD 9,500,000/- to the foreign court with an application to pass/seal the same. Notice of that application was given to the Hascol Petroleum Limited. However, the Hascol Petroleum Limited Solicitors informed the foreign court that the Hascol Petroleum did not wish to contest the passing/sealing of the consent judgment and that is how it came to be passed.
Thus, before the foreign court the circumstances were that by a prior judgment the Hascol Petroleum Limited had already been held liable to make payment to the Mena Energy DMCC; that pending trial for determining the quantum of the Hascol Petroleum Limited liability, the Hascol Petroleum Limited agreed to pay a certain sum to the Mena Energy in full and final settlement; and then on its failure to pay, the Hascol Petroleum Limited consented to the passing of a judgment against it for the agreed sum.