The concept of lifting the corporate veil is applicable not only in the cases of holding of subsidiary companies or in the case of tax evasion but can be equally applied in execution proceedings. The corporate veil can be lied in cases where the Court from the material on record comes to the conclusion that the Judgment Debtor is trying to defeat the execution of the Award which is passed against him
The disputed questions that arose in the instant case are:
a) In which cases corporate veil can be lifted by the Court and whether the concept of lifting of corporate veil is also available in execution proceedings?
b) Whether the learned Single Judge was justified in lifting the corporate veil in this case and whether the learned Single Judge was further justified in coming to the conclusion that Bhatia Industries and Infrastructure Limited (BIIL) and Bhatia International Limited (BIL) was a single economic entity?
c) Whether any interference is called for in the order passed by the learned Single Judge?
The High Court held as under: