The Supreme Court has directed Nimmagadda Prasad and related entities to jointly and severally furnish an additional security of ₹200 crore with its Registry within two weeks while proceedings for the enforcement of a UAE court decree remain pending before commercial courts in Telangana. As per the latest reports, the court has directed the respondents in the matter to furnish additional security of ₹200 crore, jointly and severally, with any encashment or appropriation of the security remaining subject to the outcome of execution proceedings before the Commercial Courts at Hyderabad and Ranga Reddy. The bench of Chief Justice of India Surya Kant, Justice Joymalya Bagchi and Justice V. Mohana held that the principles of comity of nations require Indian courts to give due weight to a decree passed by a superior court of a reciprocating territory. The court emphasized that an undertaking must be solemn, express, and intended to be acted upon by the Court, rejecting contempt allegations against the respondent entities.
The Supreme Court upheld the dismissal of contempt proceedings against MosChip and related entities, ruling that IQuest Enterprises' statement was merely a clarificatory statement and not an undertaking. The bench noted that there was no clear-cut undertaking by IQuest qualifying for an act of contempt under the Contempt of Courts Act and that neither Matrix nor Viatris nor Moschip were impleaded yet before the Commercial Courts. The court stated that "The role of IQuest was only a "back-stop" qua the termination fee, which was later released and, therefore, the statement made by IQuest before the Commercial Court did not have the direct effect of inviting contempt proceedings as far as Matrix, Viatris and Moschip are concerned." The court further observed that the statement made by IQuest before the Commercial Court, Hyderabad in its Counter Affidavit could not be treated as an unconditional undertaking, upholding the High Court's findings.
MosChip clarified that it will not fund the additional security ordered by the Supreme Court, as it is neither involved in nor an interested party in the underlying petition. The company emphasized that the additional security is proposed to be furnished by the concerned persons and entities in accordance with the court's order, with no direct financial outflow for MosChip currently envisaged. The company reiterated that the Supreme Court's latest judgment, including the Rs 200-crore security direction, does not have any financial, operational or business impact on MosChip Technologies. The court noted that "If the status quo order is vacated without any condition for appropriate security, it would amount to obstruction of justice."
The court made a rough estimation of the Medchal Land value at ₹250 crores for the purposes of the present proceedings, subject to proper valuation by the Executing Court. As per the latest reports, the present value of the decree inclusive of interest till July 23, 2026 was a sum of ₹949.96 crore, out of which NP had been able to provide security to the extent of ₹231.70 crore and also deposited title deeds of Medchal Land, which the Appellant valued approximately as ₹150 crore. The court emphasized that "the value of the Medchal Land and the appropriation will be subject to the valuation and further variation of orders passed in the Execution Proceedings." The deposits will be subject to the outcome of the Execution Proceedings pending before the Commercial Courts of Hyderabad and Ranga Reddy.
The dispute relates to the Vanpic Project, a 2008 joint venture for developing ports, an industrial corridor and an airport in Andhra Pradesh. RAKIA alleged that funds entrusted to Prasad for the project were misappropriated, with the UAE court finding RAKIA to be a victim of a fraudulent scheme. The UAE court had directed Prasad to pay AED 267.94 million, which was approximately ₹543 crore at the time, along with six per cent annual interest. RAKIA has filed four petitions in the Supreme Court seeking execution of the money decree against Prasad and others, making Matrix Pharmacorp Private Ltd, Tianish Laboratories Private Ltd, IQuest Enterprises Private Ltd and Moschip Technologies Ltd as parties. The court noted that Prasad had already provided security of about ₹231.70 crore and deposited title deeds of a 37-acre land parcel in Telangana, while RAKIA had secured attachment of assets worth ₹212 crore in execution proceedings.
