ORDER
Vimla Yadav, Member
1. In this, order I am considering four company petitions numbered as 78/2006, 84/2006, 85/2006 and 38/2007 seeking similar reliefs against the same respondents. The facts in all the four petitions are identical, same and except the name of the companies and the number of shares and properties mentioned therein. The petitioners have alleged certain acts of oppression and mismanagement by the respondents in the affairs of the Respondent Companies. Hence these petitioners. The Petitioners’ prayers as contained in C.P No. 78 of 2006, which are the same in other petitions under consideration in this order are as under: (i) to restore the shareholding of Late Shri Ramesh Chand to its original position as at the date of his death and consequently effect the transmission of such shares to the petitioners with all rights and benefits accrued in respect of such shares from the date of death of Late Shri Ramesh Chand onwards in the alternative, if the petitioners cannot be given the prayers for rectification of the register under Section 111 of the Companies Act, 1956 they should be paid adequate compensation as was intended under the Award by transfer of 1/3rd rights in the properties owned by the Company; (ii) to cancel all consequential transfers/transmissions of shares and issue of fresh shares and to declare the same as null and void or, in the alternative, transfer the shares so issued afresh, to the petitioners in such manner that total shareholding of the company is evenly disturbed amongst the three constituents of group as 1/3rd for a value at which the shares would have been allegedly issued to the Respondents; (iii) that Respondent No. 12 be directed not to receive register or take on record any forms, documents or returns filed or presented by the Respondents; (iv) to direct investigation into affairs of the Company particularly in terms of Section 235 of the Companies Act, 1956;(v) pass such further or other order/orders, as this Hon’ble Board may deem fit and proper in the fact and circumstances of the case.
2. Admitted facts of the case are: Mahalaxmi Glass Works Private Limited, Kohinoor Glass Factory Private Limited, Western India Glass Works Private Limited and Commercial and Industrial Finance Private Limited were the Flag ship companies of Chand Group of Companies, controlled by the three Brothers namely, S/Shri Naresh Chand, Mahesh Chand and Ramesh Chand, each holding equal amount of shares / interest in all these and other Companies, Firms and AOP’s of the Chand Group. Shri Ramesh Chand (Husband of Petitioner No. 1) expired on 18/12/1996 in a car accident. Certain disputes arose between the families which comprised of Shri Ramesh Chand (since deceased) Group (RC), Shri Mahesh Chand Group (MC) and Dr. Naresh Chand Group(NC). Since the disputes could not be resolved, certain issues were carried to the Court. A winding up petition was filed in the Hon’ble Bombay High Court in relation to the affairs of the Company under Section 433(1)(f) of the Companies. During the course of proceedings Arbitration Agreement was entered into between the parties. Based on the Arbitration Agreement Consent terms were drawn up and order in terms thereof was passed by Learned Single Judge of Bombay High Court. The arbitration agreement refers the issue of determination of the value of the 1/3rd share of the Ramesh Chand Group in all the family run companies, etc. Hyderabad Properties by two Ld. Arbitrators Mr. Justice P.N. Bhagwati (Retd.) and Mr. Justice V.D. Tulzapurkar (Retd.). The two Arbitrators appointed Hon’ble Mr. Justice Y.B. Chandrachud, Former Chief Justice of India as the umpire. The date of valuation, the relevant date, was the date of demise of Late Shri Ramesh Chand, i.e. 18.12.1986.
3. Awards were made and published by the Arbitrator: (a) Award dated 02.04.1994 in respect of Hydraguda Property; (b) Award dated 02.04.1994 in respect of Shiv Bagh Property (c) Award dated 02.04.1994 in relation to Serilingampally Properties; (d) Award dated 20.02.1996 in respect of lands: – (i) land situate at Village Miyapur, District – Rangareddy, Hyderabad admeasuring 282 acres and 17 Gunthas (referred to as the Baquer Khan land);(ii) Land situate at village Miyapur, District – Rangareddy, Hyderabad bearing survey Nos. 20. & 28 admeasuring 252 and 384 acers respectively i.e. total 636 acres (hereinafter referred to as the Jeelani Begum land); (e) Award dated 14.09.1996 the arbitrators also directed to hand over shares held by the petitioners in Mahalaxmi Glass Works Pvt. Ltd. (MGW), Kohinoor Glass Factory Pvt. Ltd. (KGF), and Western India Glass Works Ltd. (WIG) and other small companies including Commercial and Industrial Finance Pvt. Ltd. (CIF) and Kaycee Investments Pvt. Ltd. (Kaycee). The four awards deal with the petitioners’ share in the Hyderabad Properties (Shiv bagh, Hydraguda, Serilingampally, Baquer Khan and Jeelani Begum), the fifth award dated 14.09.1996 deals with the compensation to be paid by the respondents to the petitioners in relation to their 1/3rd share of the businesses of the various companies. Under the Fifth Award the petitioners were to be paid a sum of Rs. 4,51,50,000/- as compensation for going out of the businesses of the group. The petitioners were directed to hand over their shares in the group companies with signed blank transfer deeds in respect thereof the NC and MC Groups. It was recorded in the said award that:
48. We direct that upon full payment of the compensation amount and other amounts awarded by us to the Claimants, there will be complete severance of connection of Ramesh Chand group and the members of his family from the companies, firms, AOPs and WIG so that the Respondents can continue to carry on the businesses without any claim, demand or interest or interference of any nature whatsoever.
The petitioners’ case is that they are yet to receive the entire amounts awarded to them, as envisaged and agreed in arbitration agreement and in the consent decree/terms of reference. Hence, the petitioners, in law, and in terms of their agreement with the respondents, continue to remain 1/3rd shareholders of all the Companies, Firms, as well as AOPs and WIG till such time as the directions are complied with.
4. Shri P.V. Kapur Counsel for the Respondents vehemently argued on the maintainability of these petitions and prayed for dismissal thereof with exemplary cost. It was pointed out that Shri Ramesh Chand, husband of Ms. Suruchi Chand (P-1) and father of the Petitioner Nos. 2 and 3 died on 18th December, 1986 in a car accident. The parties in due course agreed to refer the disputes to Arbitration and an Arbitration Agreement dated 3rd January, 1989 was executed. The said Arbitration Agreement was confirmed by the High Court of Bombay on 31st January, 1989. With the consent of the parties on 2nd April, 1994 the Arbitrators made 3 independent Awards in respect of 3 landed properties at Hyderabad. With the consent of the parties the said 3 independent Awards were made Rule of the Court on 9th February, 1995 and accordingly three separate decrees were passed. Another Award in respect of the other lands which remained to be included in the earlier three Awards was made on 201 February, 1996. The said fourth Award was also made Rule of the Court on 22nd July, 1996 with consent of the parties and accordingly a separate decree was passed. On 14 September, 1996 Fifth and Final Award was made which dealt with the businesses of MGW, XGF and WIG and other small companies including CIF. and Kaycee and other outstanding matters. In the said Final and Fifth Award it was also made clear by the Arbitrators that they have dealt with and have made their awards dated 2nd April, 1994 and given directions with regard to 3 properties namely properties situated at Hyderguda and Serilingampally held by Commercial & Industrial Finance Pvt. Ltd. and Shiv Bagh held by Kaycee Investments Pvt. Ltd. in the manner indicated in the said Awards, which have been accepted by the parties. The said Awards were also confirmed in the said Fifth and Final Award.
5. It was further pointed out that the Petitioners objected to the said Fifth Award dated 14th September, 1996. The objection Petition under Sections 16, 30 and 33 of the Arbitration Act, 1940 of the Petitioners was considered and rejected by the Learned Single Judge of High Court of Bombay. The said Award was made rule of the court on 23rd January, 1998. The appeal filed before the Division Bench of the High Court of Bombay was also dismissed. The Petition for Leave to Appeal was also filed before the Supreme Court. The said Petition for Leave to Appeal was also dismissed by the Supreme Court vide order dated 18th August, 1998. However, vide the said order, the Supreme Court modified the Award to the extent that an additional sum of Rs. 5 lakhs (Rupees Five lakhs) each to be paid to the Petitioners. Review Petition to review the said order of the Supreme Court was also rejected. The Fifth Award dated 14th September, 1996 as such has also become the Rule of the Court and a fifth decree was passed.
6. Sh P.V. Kapur argued that in this view of the matter, all the five independent separate Awards became separate independent decrees and are final and binding upon the parties. There is no question of linking any of the awards to one another. The first 4 Awards determined the shares of the respective parties in various lands by removing the lands from the companies owning them and allotting the lands equally to the 3 groups in specie. The Fifth Award dated 14th September, 1996 admittedly is in respect of the businesses and shares in various companies. My attention was drawn specifically to Para Nos. 13 and 14 of the said Fifth Award dated 14th September, 1996 reproduced below:
13. By our three separate Interim Awards all dated 2nd April, 1994 we have dealt with and made our Awards and given directions with regards to three properties namely, properties situated at Hyderguda and Serilingampally held by Commercial and Industrial Finance Pvt. Ltd. and Shiv Bagh held by Kaycee Investment Private Ltd. in the manner indicated in the said awards and we hereby confirm the said Awards and directions which have been accepted by the parties.
14. Therefore, this Award deals with the businesses of MGW, KGF and WIG and other small companies including Commercial & Industries Finance Pvt. Ltd. and Kaycee Investment Private Ltd. and other outstanding matters.
7. Further, my attention was drawn to para Nos.33, 34, 38, 42, 43, 44, 45, 46 and 48 reproduced as under:
33. We have heard counsel for the parties at considerable length and having considered all relevant statements and documents filed before us, the respective submissions made on behalf of the parties and the entire material on record, we determine that in respect of 1/3rd share of Ramesh Chand group in the businesses of MGW and KGF and the 28 % interest in WIG, an aggregate sum ofRs.4,50,00,000/-(Rupees four crores and fifty lacs) be paid to the Claimants as and by way of compensation for going out of the businesses of the said three companies, subject to ) adjustment by way of deduction of the sum of Rupees 9 lakhs mentioned in paragraph 31 above so that in respect of 1/3rd share in the businesses of MGW and KGF and the 28% interest in WIG, the net amount of Rs. 4,41,00,000/- (Rupees four crores and forty one lakhs) be paid to the Claimants as and by way of compensation for going out of the businesses of the said three companies.
34. We are conscious of the fact that a winding up Petition against MGW was filed and subsequently withdrawn by consent order and as a result thereof the Arbitration Agreement was entered into and we are also conscious of the fact that there were threats of winding up the other two businesses as well. Consequently, the payment of the said sum of Rs. 4,41,00,000/- is directed to be made as and by way of compensation for preservation of the respective businesses and for buying out the Claimants and to avoid obstructions and hindrances likely to be caused by the Claimants or any of them and for smooth carrying on of the said businesses by the Respondents unhindered by the presence of any of the Claimants who might cause difficulties.
38. The Claimants are directed to hand over to Mahesh Chand Naresh Chand groups in equal shares the Shares held by the Claimants or any of them in MGW, KGF and WIG together with the relative transfer deeds duly signed in blank by the registered shareholders at nil value. Such handing over shall be against full payment to the claimants of the amount hereby awarded.
42. The Respondents are directed to continue to make monthly payments in terms of the Arbitration Agreement which include salary, perquisites etc. until the expiration of a period of twelve months from the date of the Award when liability for payment of interest will commence in case of non-payment or until full payment of the compensation amount is made, whichever event happens earlier. Such payments, which shall be in addition to the amount of compensation awarded, shall be retained by the Claimants without any adjustment whatsoever. It is made clear that immediately upon the expiration of a period of twelve months from the date of the Award or full payment of the compensation amount awarded by us, whichever is earlier, the Claimants shall cease to be entitled to any sum by way of monthly payments, salaries, perquisites etc. from the Respondents.
43. Upon payment of the full compensation amount, Ms. Saloni chand shall cease to be an Executive Officer of MGW and KGF and will not be entitled to receive any salary, perquisite or any other facilities from any of the Respondents and will vacate the room and godowns in the premises of MGW which present are occupied by the Claimants and we direct accordingly.
44. With regard to the firm of M/s Kemenar Enterprises, Mr. S. Srinivasan has recommended the capitalized value (pre-tax) at Rs. 4,18,180/-. The Respondents have submitted their valuation contending that the capitalized value of the said concern should be Rs. 2,50,908/- (pre-tax). We have considered all relevant submissions, documents and papers in connection with the valuation of the concern and we determine the value of the same at R.4,50,000/- inclusive of the value of investments in other bodies corporate, 1/3rd of which, namely Rs. 1,50,000/-, shall be paid by Kaycee Investments Pvt. Ltd. To the Claimants and this amount shall be paid in addition to the compensation amount with interest as referred to above. The firm of M/s. Kemenar Enterprises shall stand dissolved with effect from the date when the amount ofRs. 1,50,000/- is paid by Kaycee Investments Pvt. Ltd. To the Claimants.
45. The shares held by the Claimants or any of them in Kaycee Investments Pvt. Ltd., Emcee Investments Pvt. Ltd., Smriti Trading & Investment Co. Pvt. Ltd. Raj Rajeshwari Investment & Trading Co. Pvt. Ltd., Morena Investment & Trading Co. and Fontainbleau Investment & trading Co., Commercial and Industrial Finance Pvt. Ltd. and New Delhi Glass Industries Pvt. Ltd. shall be handed over together with the relative transfer deeds duly signed in blank by the registered share holders to Mahesh Chand and Naresh Chand groups by the Claimants at nil value. Such handing over shall be against full payment of the amount of compensation awarded by us to the Claimants.
46. With regard to Encee Investments and Arcee Associates which are associations of persons of which the Claimants or any of them are members, they shall cease to be members of such AOPs on full payments being made to them under the Award. The right, title and interest of the Claimants or any of them in the said AOPs shall vest in Naresh Chand and Mahesh Chand groups in equal shares.
48. We direct that upon full payment of the compensation amount and other amounts awarded by us to the Claimants, there will be complete severance of connections of Ramesh Chand group and the members of his family from the companies, firms, AOPs and WIG so that the Respondents can continue to carry on the businesses without any claim, demand or interest or interference of any nature whatsoever.
8. It was pointed out that the awarded amount of Rs. 4.41 crores (Rs. 4.5 crore, less 9 lakhs paid earlier) and Rs. 1,50,000/- were deposited with the High Court of Bombay after taking permission from the Bombay High Court for the such deposit because the Solicitors of the Petitioners had refused to receive the said amount. The Petitioners applied to the Supreme Court and, Supreme Court permitted the Petitioners to withdraw the said amount vide order dated 18 August, 1998. Accordingly, appropriate directions on the Petition of the Petitioners to withdraw the amount was issued by a Division Bench of the High Court of Bombay on 23rd November, 1998. It was informed that the said amounts have since been withdrawn by the Petitioners and this means the Petitioners have accepted the benefit of the said Fifth Award and have been fully compensated for absolutely going out of the business of the relevant companies.
9. Shri P.V. Kapur Counsel for the respondents argued that these company petitions are not maintainable as the conditions precedent for invoking the provisions of Sections 397 and 398 of the Act have not been satisfied by the Petitioners. It was argued that that in a petition under Sections 397 and 398 of the Companies Act, 1956 (the Act) the rights and interest of a member of a company as a member can alone be agitated and not otherwise. In terms of Section 399 of the Act the members fulfilling the requirements thereof have the right to allege oppression and mismanagement of the Company and can file a Petition in terms of the said Sections. In view of the aforesaid unambiguous provisions of the Act, the Petitioners are required to satisfy the CLB that the Petitioners individually or three together hold the requisite percentage of shares in the Company. It is the requirement of the law that the Petition under Sections 397 and has to accompany documentary evidence in proof of the eligibility and status of the Petitioner(s) that the voting power held by each of them is as per provisions of the Section 399 of the Act. Further, the word ‘oppression’ suggests burdensome, harsh and wrongful conduct on the part of the majority shareholders designed to achieve an unfair advantage to the prejudice of the minority shareholders. In the instant case, the Petitioners are not shareholders at all far less the minority. Relying upon the judgment of the Supreme Court in the case of Needle Industries Newey (India) Holding Ltd. (1981) 51 Company Cases 743 equivalent to AIR (1981) SC 1298, the Respondents argued that the Petitioners are neither shareholders in any sense of the term and in any event have failed to adduce any evidence that the conduct of the Respondents lack probity or is unfair or causes prejudice to the Petitioners in the exercise of their legal and proprietary rights as a shareholder. Further, it was pointed out that during the life time of Shri Ramesh Chand he did not hold any equity Shares in his individual name in any of the Companies. Consequently, Petitioners could not have inherited any Share in any of the Companies. However, admittedly, the Shares in the Companies were held jointly by the three brothers. On demise of Ramesh Chand, the Shares vested in the other co-owners i.e. Shri Naresh Chand (Respondent No. 2) and Shri Mahesh Chand (Respondent No. 3). The Petitioners have not produced any documentary evidence which can satisfy the Company Law Board that as on the date of the presentation of the Petition or at any time, the Petitioners or any of them were or are Shareholders or have any interest therein or have any voting right. It was pointed out that the Petitioners were the only heirs of Late Ramesh Chand. The Petitioners never held any equity shares in The MGW, KGF, Kaycee, Emcee, Smriti, Rajarajeshwari, Morena, Fountainbleau. The Petitioners held preference shares in these Companies which had to be compulsorily redeemed in compliance with the relevant provisions of the law by 15th June, 1998 and were therefore redeemed on 11th June, 1998. The redemption amount was paid to Mahesh Chand Group (MC group) and Naresh Chand Group (NC group) as a consequence of the Final Award, after the Respondents had complied with the terms thereof. It then became necessary to issue fresh Equity Shares. For example MGW’s remaining capital, after redemption of the preference shares was Rs.l 00,600/- and of KGF Rs. 27,000/-. MGW and KGF and likewise the other 6 companies therefore issued fresh equity capital equal to the redeemed preference capital and allotted them to the MC and NC groups, because there was no question of allotting them to the RC group, who had been paid off by the companies in terms of the Final Award dated 14th September, 1996. There was, therefore, never any transfer of Preference Shares from the RC group to MC or NC in the case of MGW, KGF, Kaycee, Emcee, Smriti, Rajrajeshwari, Morena and Fountainebleau. Further, it was argued that as regards the equity shares of all these Companies, all the Equity Shares in MGW were held 99 % by Kaycee and the balance by CIF; the Petitioners’ equity shares in KGF were held by the AOP Arcee Associates, shares in Kaycee, Emcee and Smriti were held by a chain in which each of the three Companies held the Equity Shares of the other two companies. Similar was the case for the chain of Rajrajeshwari, Morena and Fountainebleau. Thus there was no transfer of equity shares at all from the Petitioners in the case of MGW, KGF, Kaycee, Emcee, Smriti, Rajrajeshwari, Morena and Fountainebleau as alleged Thus, there was no question of any violation of Sections 84 and 108 of the Act, at least in respect of these Companies in as much as the Companies themselves held the Equity Shares in other Companies, 1/3 of the Equity Shares representing the interest of the Petitioners were transferred by the shareholding companies to the MC and NC groups in compliance with the Final Award (Fifth Award). Furthermore, it was argued that the transfer of Shares in the present case is not like the usual transfer of Shares where a party purchases Shares and presents the Certificates to the Company for transfer in the name of the Purchaser. The present case was a case where the Companies had to pay off one of their shareholders. This would have led to a reduction of share capital of the companies. To avoid that, the Petitioners’ shares were ordered to be transferred to MC and NC groups at “Nil” value. This was a transfer by order of court. Such a transfer was thus involuntary. The companies waited until the Final Award had been confirmed by the Supreme Court and only then they gave effect to the transfers. After paying off the Petitioners the only remaining shareholders were MC and NC. The redemption of Preference Shares was done on 11th June, 1998 and the issue of fresh equity shares of the 8 companies was done in December 1998, one year before the Petitioners handed over some of the Share Certificates to the Prothonotary of Bombay High Court in December 1999. The only Companies which transferred the Equity Share held by the Petitioners to MC and NC Groups were CIF, NDGI and WIG. The land belonging to OF had already been allotted to the concerned parties in specie. In WIG the Petitioners had only certificates for 100 shares in their possession which they deposited with the Prothonotary of Bombay High Court, out of 1,35,289 shares possessed by them, and they said before the Prothonotary of Bombay High Court that they had no further Share Certificates in their possession. Further, it was pointed out that the Petitioners had filed an Application to intervene in the proceedings under Sections 391 and 394 of the Act for sanction of a Scheme of Arrangement between. The Kohinoor Glass Factory Pvt. Ltd. with The Mahalakshmi Glass Works Pvt. Ltd. (MGW) being Company Application No. 493/2000 on the ground that they have a right in the share holding of MGW. The said Petition was decided by Smt. K.K. Bam J. of the Bombay High Court on 8th November, 2000. The issue which was required to be considered by the Hon’ble Judge was whether the Interveners have any right in the Applicant Company. The Hon’ble Judge considered the said submission with reference to the Final Award dated 14th September, 1996 (Fifth Award) and, after considering me contentions observed in paragraphs 14 and 15 of the judgment as under:
14. A perusal of the Order dated December 22, 1999 passed by the Prothonotary & Senior Master, High Court, Bombay in Arbitration Petition No. 110 of 1997 records that it is the case of the interveners that the shares have been deposited in the office of the Court Receiver, High Court, Bombay. However, the appellants – interveners were required to sign necessary transfer documents/forms for transfer of shares lying in the office of the Court Receiver’s office, Bombay, in favour of the Respondents as per the award. The order further reveals that appellants-interveners herein were also called upon to deposit 360 equity shares of M/s Kohinoor Glass Factory. However, the learned Advocate appearing for the Appellants-interveners stated that they do not have in their possession the said shares. As per the order of Prothonotary & Senior Master the appellants-interveners had not deposited 9200 preference shares held by them but only 6012 shares. The appellants-interveners denied having in their possession the balance share. Other shares, as recorded in the Prothonotary’s order, also were not deposited either with the Registry or office of the Prothonotary & Senior Master.
15. It is, therefore, clear from the order passed by the Prothonotary & Senior Master, that though the amount of Rs.4.41 crore and Rs. 1.50 lacs were received by the appellants-interveners, they have not cared to comply with the terms of the award, not cared to deposit the shares as per the terms of the award, had not co-operated with other Respondents as per the terms of the award but held on to the shares and at this stage when an application is made by the applicants for the scheme of Arrangement, the interveners are seeking to intervene in the scheme without a semblance of any right in the Petitioner company.
10. Further, it was pointed out that not satisfied with the order passed by the Single Bench, the Petitioners preferred an Appeal in the Bombay High Court. After hearing the arguments in detail, the Division Bench comprising Shri B.N. Srikrishna and Smt. Nishita Mahtre, JJ, ordered, interalia,
3 We have perused the record including the order of the learned Company Judge dated November 8, 2000 and heard the counsel on both sides. We are not satisfied that the appellants continued to hold rights in the companies as shareholders of the companies which are the subject matter of the Petition, nor are we satisfied that there was any bonafide objection to the scheme….
11. Further, not satisfied even with this, the Petitioners filed a Review Petition in the Bombay High Court. Again the Division Bench comprising Shri R.J. Koshr and Smt. Nishita Mahtre, JJ, observed as follows:
5… The order of 23rd April, 2001 clearly mentions that the Court had perused the record including the order of the learned Company Judge dated November 8, 2000 and heard the Counsel on both sides and had come to the conclusion that the appellants did not continue to hold rights in the companies as shareholders or that there was any bonafide objection to the Scheme….
12. It was pointed out that the Petitioners did not let the matter rest even then. They filed a Special Leave Petition in the Supreme Court. The Supreme Court, coram Hon’ble Mr. Justice R.C. Lahoti and Hon’ble Mr. Justice D.M. Dharmadhikari after a hearing lasting about 18 minutes, passed the following order on 22nd March, 2004.
UPON hearing counsel the Court made the following
ORDER
Delay condoned.
The Special Leave Petitions are dismissed.
13. It was further argued that the several allegations made in the Petition and other pleadings filed in these proceedings before the CLB are baseless, unsupported by any evidence and no reliance should be placed on them. In fact, such averments are contrary to the findings of Hon’ble Bombay High Court as well as the Supreme Court. Besides, the Awards of Justice P.N. Bhagwati and Justice V.D. Tulzapurkar establish beyond doubt that the Petitioners lost whatever right thus had in any of the Companies they lost the same and MC group and NC group acquired the same absolutely.
14. It was pointed out that the awarded amount of Rs. 4.41 crores (Rs. 4.5 crores less 9 lakhs paid earlier) and Rs. 1,50,000/- were deposited with the High Court of Bombay after taking permission from the Bombay High Court for the said deposit because the Solicitors of the Petitioners had refused to receive the said amount. The Petitioners applied to the Supreme Court who permitted the Petitioners to withdraw the said amount vide order dated 18th August, 1998. Accordingly, appropriate directions on the Petition of the Petitioners to withdraw the amount was issued by a Division Bench of the High Court of Bombay on 23rd November, 1998. The said amounts have since been withdrawn by the Petitioners.
15. It was vehemently argued that the Petitioners did not satisfy the conditions precedent for invoking the provisions of the Sections 397 and 398 read with Section 399 of the Act. The Petitioners are not shareholders of the Company. Admittedly, Shri Ramesh Chand had 7863 Preference Shares in his individual name, 470 Preference Shares in joint holding, no individual equity holding and 334 joint equity holdings. It is settled law that on the death of one of the joint shareholders, only the survivors are to be recognized as members by the Company. No legal heir of the deceased member shall be entitled to be recognized as member. A legal heir becomes entitled to the shares only when the deceased was the sole holder. By applying this law it can be said that the Petitioners cannot claim to be members with regard to joint holdings. In this regard reference was made to the following case law:
In the case of Ram Govind Mishra v. Allahabad Theatres reported in (1986) Tax LR 1681 (All.) it has been held at page 1683 that “in case where shares are held jointly, the interest of the deceased shareholder passes to the survivor and not to the heir of the deceased and that the said heir neither becomes a holder of a share nor a contributory within the meaning of the Section 428 of the Companies Act, 1956.
So far as the individual holdings are concerned, the same has already been redeemed in terms of the Final Award (Fifth Award). In such circumstances, at the time of filing of the Petition, the Petitioners were not even shareholders of any of the Companies.
16. Shri P.V. Kapur argued that the petition suffers from the principles of res judicata. The doctrine of res-judicata is applicable with all force in the facts of this case. It is well established principle of law that any judgment or order or decree of a judicial authority concludes not merely as to the point actually decided but as to the matter which it was necessary to decide, and which was actually decided. A judgment or order even by consent of the parties is hit by the doctrine of res-judicata. In such a case, the Court is discharged from the duty of investigation or further investigating the matter in controversy and does not pronounce a judicial opinion on them; but at the joint request of the parties it gives judicial sanction to what they have agreed. Judgments, orders and Awards by consent is as efficacious as those pronounced after a contest, in creating cause of action estoppels and effecting a merger of the causes of action sued on. By virtue of the doctrine of Res-judicata in every case, the decision estops or precludes any party to the litigation or his privies from disputing against any other party or his privies, in later litigation. The same claim cannot be raised again and again between the same parties and this principle extends to all matters of law and fact which the decision necessarily establish as the foundation of the conclusion reached by the judicial pronouncement. It was contended that the petitioners neither had nor have any right, title or interest left in MGW or any of the Companies and the same has been in various orders by Appropriate Courts in different proceedings in particular Bombay High Court both the learned Single Judge and the learned Members of the Division Bench had held that the Petitioners had no semblance of right in MGW. These orders have attained finality. The Petitioners filed this Petition on the same question which has already been adjudicated and decided against them in those orders which have attained finality. In this view of the matter, the Petition suffers from the vice of Res-Judicata. Company Law Board has no jurisdiction to review the correctness of any of the orders passed by the Hon’ble Bombay High Court at Bombay. In this view of the matter, these Petitions filed under Sections 397 and 398 of the Act suffer from the vice of lack of jurisdiction and should be dismissed.
17. Shri P.V. Kapur argued that the petitioners cannot approbate and reprobate. They cannot take advantage and benefit of Awards which merged into the judgments and orders of High Court and Supreme Court, and then challenge the Awards, directly or indirectly. It is well settled principle decided by a number of judicial decisions that a person acting in terms of an Order or Decree of a competent Court and taking the benefit there under cannot challenge the correctness and/or validity of Order or Decree or judgment at a subsequent stage. A person cannot at the same time blow hot and cold. In the present proceedings before the CLB, the Petitioners are seeking a review or enforcement or execution of the Awards which is not permissible nor it is within the competence of the CLB.
18. Further, my attention was drawn to the principle of estoppel. Since the date of death of Ramesh Chand in the year 1986, Suruchi Chand Group used to draw Rs. 50,000/- per month in addition to salary, perquisite, benefit of use of car at Company’s expenses, telephone and membership of club and all expenses incurred thereat. It was pointed out that in terms of the Clause 42 of the Fifth and Final Award, the Respondents were directed to continue to make monthly payments to Suruchi Chand Group until the expiration of a period of 12 months from the date of the Award when liability for payment of interest would commence in case of non-payment or until full payment of compensation amount was paid whichever event happens earlier and upon full payment of compensation amount awarded in the said Award Suruchi Chand Group would not be entitled to any sum by way of payment of monthly salary, perquisite, etc., from the Respondents. Full compensation amount in terms of the Award was deposited with Prothonotary of the Bombay High Court on 12 September, 1997 and thereafter MGW discontinued disbursement of monthly salary, perquisite, etc. to Suruchi Chand group. Till date no objection has been raised by Suruchi Chand Group for such stoppage. This means that Suruchi Chand accepted directions in the Fifth and Final Award in toto without having any objection on any ground whatsoever, as early as in September, 1997. Objections to the Award now after 10 years on any ground cannot be sustained.
19. It was argued that the petition has been filed with an oblique motive to overcome the Award which has attained finality and therefore, is binding between the parties. The Award was challenged by the Petitioners before the Bombay High Court and was subsequently challenged in the Supreme Court. Both the Courts dismissed the Petitioner’s challenge to the Award. The Award was made a Rule of the Court and since the Petitioners have exhausted all the remedies by way of Appeal up to the Supreme Court, the Petitioners are bound to adhere to the Award in view of the finality attained by the Award. By this petition, the petitioner are trying to overcome the Award in an indirect manner which is bad in law and equity. The Petition has been filed by the Petitioners with an oblique motive in mind and to achieve a collateral purpose.
20 Shri P.V. Kapur contended that the Petition is an abuse of the process of judicial proceedings. As the Petitioners’ claim on the basis of which this Petition has been filed stands decided by the civil courts, the same question, if allowed to be agitated before the CLB, would amount to abuse of the process of the Bench and the same should be dismissed in exercise of its inherent power under Regulation 44 of the Company Law Board Regulation, 1991. Reliance was placed on the cases of “Re: Bellador Silk Ltd” reported in (1965) 1 All ER 667, wherein it has been held that “the presentation of the Petition in order to bring pressure to bear to achieve a collateral purpose was an abuse of the process of the court”; in “Mrs. Najma M. Saiyed v. Mehboob Productions P. Ltd., and Ors. reported in (2006) 129 Company Cases 603 (CLB), it has been held “that a Petition for a collateral purpose should not be entertained”; and in L. Rama Subbu and Anr. v. Madura College Board reported in (1998) 3 Comp. LJ 356 (CLB), wherein it has been held at Page 364 that “if we allow the Petitioners to challenge the very same resolution on practically the same grounds or one or two more, we would be simply encouraging the Petitioners to abuse the process of court.”
21. Shri P.V. Kapur further argued that the Petitioners have not come with clean hands. In terms of the binding Award, the Petitioners were divested of all interest in Companies in return of compensation as awarded by the Arbitrators and received by them. The proceedings under Section 397 are equitable in nature and so as an equity court the CLB should dismiss the same since the Petitioners have flouted the binding Awards and approached the CLB to overcome the said Award which proves that the hands of the Petitioners are not clean. The CLB must follow the common law principle that he who seeks equity must do equity. In this connection, reliance was made on the decisions in the cases of Chetak Construction Ltd., v. Om Prakash and Ors. , wherein it has been held that “A litigant cannot be permitted “Choise” of “the Forum” and every attempt at “forum-shopping” must be crushed with a heavy hand”; in “Srikanta Delta Narasimharaja Wadiyar v. Sri Venkatewara Real Estates Enterprises (Pvt.) Ltd., and Ors. reported in (1991) 72 CC 211, it has been held at Page 241 that “even assuming that the allegations of the petitioner, if proved, do make out a case of oppression and mismanagement within the scope of Section 397 and 398 of the Act, mere proof of those allegations will not entitle the petitioner to the reliefs sought for when relief are discretionary reliefs and they will be granted only to persons who approach this Court in good faith and the parties who approach this Court for equitable reliefs must come with a clean record”.
22. The respondents’ case is that (1) the conditions precedent for invoking the provisions of Sections 397 and 398 of the Act, 1956 have not been satisfied by the Petitioners; (2) there is no violation of Sections 108 or 111 of the Act; (3) the Petition suffers from the principles of res-judicata; (4) the Petitioners cannot approbate and reprobate that is to say take advantage and benefit of Awards which merged into the judgments and orders of High Court and Supreme Court, and then challenge the Awards, directly or indirectly; (5) the Petition has been filed with an oblique motive to overcome the Award which has attained finality and therefore, is binding between the parties; (6) the Petition is an abuse of the process of judicial proceedings; (7) the Petitioner has not come with clean hands; (8) they have had an alternative remedy, (9) the CLB has no jurisdiction; (10) personal grievance, if any, cannot form the subject matter of proceedings under Sections 397 and 398 of the Act; (11) the Petition relates to matters of 1998, there is no plea for condoning more than eight years of delay and latches which is fatal to proceedings; (12) There has to be finality of disputes; (13) the matter before the Company Law Board is hit by the doctrine of conclusiveness and finality in judicial proceedings; (14) all five Awards and five separate decrees are separate and cannot be co-joint or amalgamated or merged.
23. Shri. S. Sarkar and Shri U.K. Choudhary, Senior Advocates appearing for the petitioners argued that the petitioners have not received the consideration that they were supposed to receive under the awards, the petitioners have not signed any transfer forms for the shares, the shares were not even requested to be transmitted to the names of the legal heirs of late Sh. Ramesh Chand, the shares were in the possession of the receiver, the Respondents had filed contempt petitions in the High Court Bombay for the petitioner not having implemented the Award by not handing over the share certificates which were already with the Court Receiver, the High Court Bombay and taken away clandestinely by the respondents, the petitioners should be reverted back to their original position by a verification in the register by inserting their names in the register of shareholders. The petitioner’s main grievance is in relation to Miyapur lands which was the subject matter of the Fourth Award dated 20.2.1996 which provided that the petitioner would conduct the business of Respondent No. 9 of selling properties after getting power of attorney and then distribute the sale proceeds after deducting the expenses. It is the petitioner’s case that inspite of repeated requests R-2 & 3 have neither given power of attorney nor executed a conveyance in favour of petitioners for the 1/3rd property given under the Fourth Award dated 20.2.1996. Therefore, the petitioner’s case being that the final Award (Fifth Award) cannot be given effect to because of Fourth Award has not been acted upon fully. The petitioners have reiterated their stand that the awards are interlinked. It was argued that the Arbitrators passed Four Interim Awards and One Final Award. As per the terms of the award the petitioners were to severe their connections with the respondent companies after the payment of compensation awarded to them, which is not paid till date. Since the respondents have illegally transferred their shares, subsequently issued fresh capital to the exclusion of the petitioners, running the companies to their personal advantage and to the disadvantage of the shareholders and siphoning off the funds of the companies, the petitioners are compelled to approach this Hon’ble Board by the way of present petition. My attention was drawn to the terms of the Arbitration Agreement that until the award is made a rule of the Court, and the amount, and interest if any, awarded to themamesh Chand Group in respect of their said 1/3rd share and the value of the interest to the extent of 28% of the Ramesh Chand Group in the business of WIG are paid to the Ramesh Chand Group in full: (a) no assets of any of the companies being parties of the 4th to 13th part, or firms or AOPs, or WIG shall be sold, disposed of or encumbered in any manner whatsoever save and except in the ordinary course of business and/or for the purposes of making full payment of the amount and interest, if any, awarded; (b) no party hereto shall hereafter sell, dispose of, encumber or transfer in any manner any of the shares in the Companies being parties of the Fourth to the Thirteenth part herein or in WIG save and except amongst the members of the family of the group concerned which shall not be objected to by the other parties, but intimation of the same shall be given to the other parties and (c) no party hereto shall make any change in the constitution of any of the partnerships or Association of Persons set out in the First Schedule. Further, it was pointed out that Keminar Enterprises was a partnership firm in which late Shri Ramesh Chand, his two brothers, respondents No. 2 and 3 and two Group Companies Kaycee Investment Pvt. Ltd. and Emcee Investment Pvt. Ltd. were partners. All the brothers were holding 10% each and Companies were holding 35% each capital. This firm is not a signatory to the arbitration agreement, though its partners/legal heirs of Ramesh Chand are.
24. Drawing my attention to the directions in the interim award in respect of Serilingampally properties, it was pointed out that (a) the respondents were to handover all original papers, title deeds and documents to the petitioners’ Advocate. This was never done (the land was comprised under two titles deeds. Only one was handed over which is now lying deposited in Bombay High Court and the second was never handed over); (b) the petitioners were entitled to sell the properties; (c) the /Respondents were entitled to procure the offer and communicate the same to the petitioners;(d) if the petitioners did not, within a period of three months, receive any satisfactory offer, they were entitled to dispose of the property by auction and thereafter divide the sale proceeds, net of all costs, charges and expenses. Subsequently, directions were issued by the arbitrator for executions and registrations of the appropriate power of attorney in favour of the petitioners in relation to the Shrivangalpalli properties. Further, it was pointed out that in relation to the interim award in respect of remaining properties of Hyderabad (Baquer Khan and Jeelani Begum lands) which were not covered by the earlier three interim awards, the following directions were issued: (a) one-third of 282 acres and 17 gunthas of Baquer Khan land was awarded to the Petitioners out of which the Petitioner were deemed to be the owners of 100 acres of land forming part of Survey No. 45 and being part of 130 acres and 17 gunthas agreed to be sold under the Agreement for Sale dated 08.05.1995; (b) in respect of remaining 182 acres of land, CIF, i.e. the Company, was to execute a power of attorney in favour of one of the petitioners authorizing them to sell the said 182 acres of land and retain 1/3rd of the sale proceeds; (c) the 636 acres of land of Jeelani Begum situated in Village Mianpur was to be sold by the petitioners and the power of attorney was to be executed by CIF in favour of the petitioners. (d) none of the above referred two Power of Attorneys in respect of 182 acres of Baquer Khan land and 636 acres of Jeelani Begum land were executed by CIF, which was controlled by the respondent Nos. 2 and 3, in favour of the petitioners;(e) in respect of lands at Serilingampally, Baquer Khan and Jeelani Begum, consent decrees were obtained by filing the awards in the competent civil court. Since the respondents “Mid not comply with the terms of the awards, executions were taken out, the respondents have taken the stand that the decrees/awards are unexecutable. It was argued that in fact the final award dated 14.09.1996 also notes the above as the scope of reference, confirms the interim award in relation to the Hyderabad Properties. By the final Award dated 14.09.1996 the arbitrators also directed to hand over shares held by the petitioners in MGW, KGF and WIG together with the relative transfer deeds duly signed against full payment of the amounts awarded to the petitioners. It was argued that by harmonious construction of the Arbitration Agreement, the consent decree, the terms of reference and the awards themselves, it is apparent that the petitioners were not liable to go out from and/or severe their connections with the businesses including the Hyderabad Properties and the said Companies, Firms, AOPs and Western India Glass Works (WIG) till such time that the petitioners were paid the value of their 1/3rd share in the said businesses including the said Hyderabad Properties and the value of their interest to the extent of 28% in the business of WIG as may be awarded to them. It was argued that it cannot be disputed that the 1/3r share of the petitioners in the said businesses including the Hyderabad Properties is comprised and/or spread over the four interim awards and the final award dated 14.09.1996. The final Award dated 14.09.1996 also directed parties to execute whatsoever deed, documents and papers necessary for effective implementation of the directions given in the Award. Hence, it was pointed out that it is only upon receipt of the entire amounts awarded to the petitioners in the five arbitration awards that the petitioners were to severe all connection with the Companies, Firms and AOPs and WIG.
25. It was argued that the respondents had made illegal transfer and/or allots shares belonging to the petitioners to themselves and/or to members of their group. Such illegal transfers made after 18.12.1986 are completely illegal and contrary to law and are liable to be cancelled and/or set-aside by this Hon’ble Board. The petitioners are entitled to have restored in their favour their 1/3rd shareholding in each of the Companies, namely, MGW, KFG, WIG and CIF in addition to all other Companies, Firms, AOPs belonging to the Chand Group. It was pointed out that the amount awarded by the arbitrators is business preservation expense. It was further argued that the respondents have illegally kept the petitioners out of the management and assets of the company to which they are legally entitled. In this view the petitioners deserves to be compensated for the illegality committed by the respondents.
26. It was argued by the counsels for the petitioners that the parties are bound by the terms of the Arbitration Agreement and cannot deny the same. It is a specific term of the Arbitration Agreement that severance of the petitioners’ group from the companies, firms and AOPs would take place only and only once they are paid the value of their one-third share in the businesses as well as in the Hyderabad Properties. It was pointed out that the value of their shares in the Hyderabad Properties has not been paid to them and/or has not been received by them due to the acts and omissions on the part of the respondents. It was contended that not only the parties but the Learned Arbitrators are also bound by the terms of reference governing the arbitral proceedings, Consequently, it was argued that the directions given in the final award dated 14th September 1996 has to be construed in the light of the Arbitration Agreement and the terms of reference. When so constructed it can only mean that severance of the petitioners group would take place only once all the five awards are satisfied. It was argued that admittedly, the petitioners have not received their shares and the respondents have not complied with the directions given by the arbitrator in respect of the two interim awards relating to Serilingampally lands, Baquer Khan lands and Jeelani Begum lands. The respondents cannot contend that the petitioners have lost all their rights and interests in their one third shares in Mahalaxmi, Kohinoor and CIF and their rights in respect of the 28% shares in WIG. This is contrary to the Arbitration Agreement, the terms of reference and the awards themselves. It was reiterated noted that the four interim awards were converted into consent decree by consent of both parties. The final award was challenged by the petitioners but was upheld all the way to the Hon’ble Supreme Court of India.
27. Responding to the respondents’ contention that the petitioners have no locus-standi as they are not the shareholders in any of the respondents’ companies as they have received a sum of Rs. 4.41 crores which is the value of one-third shares in the Chand Group of Companies, and that the petitioners have lost all legal and beneficial interests in the shares and hence the company took the policy decision to cancel the shares which stood in the name of the petitioners, the counsel for the petitioner argued that they have not lost any of their rights to the shares in terms of the Arbitration Agreement, the Terms of Reference and the Award, it was contended that in law, no policy decision can be taken by the company to cancel the shareholding of a shareholder contrary to Section 101 to 104 of the Companies Act. In any event, no copy of such rigid policy decision has been even placed on record neither is the Board of Directors authorized to take such a policy decision. The consent of the Court and mandatory provisions of the Companies Act have not been complied with for cancellation of the shares and hence the alleged cancellation is void and illegal and if the same is correct the respondents are liable for getting the same set aside on its being contrary to law and is also liable for appropriate proceedings. It was pointed out that the petitioners being the lawful owners of one-third of the equity share capital of the Respondent Company cannot be dispossessed of their shares without following the due process of law. Reliance was placed on the case laws reported at 1996 (4) SCC 144 at page 147 paragraph (6), 2004 Vol. Ill SCC 137 at page 150 paragraph (24);127(2006) Delhi Law Times 431 at page 443 paragraph (17) and at page 447 paragraph (20) The counsel for the petitioner pointed out that the language of Section 108 of the Companies Act is mandatory in nature, to issue shares without complying with the requirements of Section 108 of the Companies Act, is contrary to law and every such issuance of shares is null and void. Reliance was placed on the case reported at AIR 1977 SC 536 at page 538 (para 16) & at page 539 (para 21) and at page 540 (para 23). It was argued that the original share certificates of the petitioners’ group along with duly executed transfer deed were lying in the custody of the prothonotary of the Bombay High Court pursuant to Order dated 1st December, 1999. It was contended that the petitioner had filed the present petition under Section 397 and 398 of the Companies Act read with Section 111 of the Companies Act seeking rectification. It was contended that the question as to whether the petitioners’ shares could have been dealt with in the manner done by the respondents group can only be decided by this Hon’ble Board and not by the Bombay High Court in proceedings under Section 391 and 394 of the Companies Act. In proceedings under Section 391 and 394 of the Companies Act, the approval or otherwise of the scheme of arrangement or compromise is the primary concern before the Hon’ble Court. The Court in those proceedings is not empowered to and does not have the jurisdiction to adjudicate on the question as to whether the shareholding of a member or a group of members of the company has been illegally transferred and/or allowed in favour of another member/group of members of the company. This jurisdiction and the power to grant this relief is specifically conferred upon this Hon’ble Board by Section 397, 398 and 111 of the Companies Act. It is settled principle of law that if a particular type of relief sought for can only be given in an appropriate proceedings under Sections 397, 398 and 111 of the Companies Act which, are the Code by themselves, it is not possible to circumvent that procedure by instituting the proceedings in any other forum. Reliance was placed on the case reported at AIR 1982 Calcutta 94 At Page 95 (Paragraph 3) 103 (2001) Company Cases 1063 (Delhi High Court) At Page 1077.
28. It was argued that the respondents have failed to demonstrate that they have complied with the requirement of law when they decided to issue duplicate share certificates. Reliance was placed on the case reported at Vol(88)1997 Company Cases 471 At Pages 496, 497 And 498. It was argued that the plea of the respondent that since the petitioners have deposited the shares with the prothonotoray and therefore is not competent to maintain the petition before this Hon’ble Court is unwarranted for in the light of the law laid down in [1985 (57) Company Cases 831 at 847 to 847 refers] In the present case, it was argued it bears repetition that the original share certificates of the petitioners’ group are admittedly lying deposited with the Prothonotary of the Bombay High Court. This position has not been disputed or denied by the respondents. It has been specifically noted in the judgment and order dated 27th April, 1998 of Hon’ble Ms. Justice K.K. Bham of the Bombay High Court that if the petitioners herein fails to comply with the directions contained in award, then it is always open to the respondents herein to adopt appropriate proceedings. This order has not been challenged.
29. Replying to the Respondent’s plea that Principles of Res judicata apply to the present proceedings because of the orders of Bombay High Court given in October, 2000, it was argued that the decision of the Bombay High Court in the amalgamation proceedings cannot and does not amount to res judicata since that Court was not competent to decide the issue whether the petitioners shareholding was illegally taken away by the Respondents. It was pointed out that the Court hearing a petition under Sections 391 and 394 of the Companies Act is only competent to look into the scheme sought to be propounded by the transferer and transferee Company. It is not competent, neither it have jurisdiction to decide whether or not the petitioner’s shares should be restored to them since they have been illegally transferred and/or taken away by the respondents. The jurisdiction to decide such an issue rests squarely and only with this Hon’ble Board under Sections 397, 398, 111 and 111A of the Companies Act, 1956. It is settled law that a previous decision of a competent Court on facts which are the foundation of the right and the relevant law applicable to be determination of the transaction which is the source of the right is resjudicata. In this case, as aforesaid, the Bombay High Court was not the Court competent to look into the issues raised in the present petition. Reliance was placed on the case reported at 1970 (1) SCC 613 at 617 (paragraph 5). Secondly it was pointed out that only when the issue has been heard and finally decided can it be said to be resjudicata in subsequent proceeding between the same parties. In the amalgamation proceedings in the Bombay High Court the order of the Bombay High Court reveals that the petitioners seeking leave to intervene in these proceedings was dismissed on the ground that the petitioners were not able to prima-facie demonstrate that their name appeared on the register of members and/or they were shareholders of the respondent company. Hence, the issue whether the petitioners shareholding was illegal and/or legal taken away was never gone into, adjudicated or decided by the Bombay High Court in those proceedings. It is settled law that in order that a matter may be said to have been heard and finally decided, the decision in the former proceedings must have been on the merits Reliance was placed on the case law reported at AIR 1966 SC 1332 at 1336 paragraph 13; AIR 1976 SC 1569 at 1575, paragraph 7; AIR 1998 SC 972 at 976, 977 paragraphs 9, 11 and 13; Without prejudice to the foregoing the petitioners pointed out that the plea of res judicata raised by the respondent cannot also be entertained since all material particulars which would be necessary to give a finding as to whether a particular case is barred by the principles of res judicata or not have not been placed on record in the present proceedings by the respondent. It is settled law that res judicata is a mixed question of fact and law. It has to be specifically pleaded and all material particulars relating to that plea need to be placed on record. In the present case, except the judgment of the Bombay High Court no other materials, particularly the pleadings of the parties in this proceedings have been placed on record. Reliance was placed on the case law reported at AIR 1996 Orissa 1 (at page 1 & 2, paragraph 4). It was further argued that any incidental finding given by a Court lacking jurisdiction in the prior proceedings cannot be said to be binding in the next proceedings nor can it be the basis of a plea for res-judicata. Reliance was placed on the case law reported at AIR 1952 SC 143; AIR 1982 SC 20; AIR 1987 Gujarat 167 at 170 paragraphs 12 & 13.
30. It was argued by the petitioners that the arbitration agreement dated 03.01.1989 acknowledges the 1/3 shareholding of the petitioners. The arbitration proceedings culminated in the final award dated 14.09.1996. In para 38 of the final award the petitioners were directed to hand over shares held by them in Mahalaxmi, Kohinoor and Western India against full payment to them of the amounts awarded. As aforesaid, it is the Petitioners’ contention that the amounts awarded have still not been paid. Consequently at least till 14.09.1996 (date of the final award) the 1/3 shareholding of the petitioners’ including the preference shares could not have been dealt with in any manner by the respondents. However, the search report in relation to the shareholding in Mahalaxmi Glass Works demonstrates that in the year 1995-96 the Company has shown the shareholding (both preference and equity held in joint name) of the petitioner group as nil. This could not have been done. Any action taken by the Respondents to reduce the Petitioners’ shareholding to nil in illegal and null and void in the eyes of law. The individual preference shares of Ramesh Chand was shown as nil in the year 1998-99. The Petitioners argued that this action of the Respondents is also illegal and null and void in the eyes of law. It is important that the final award is dated 14.09.1996 which was finally upheld by the Supreme Court on 18.08.1998. During this time neither the equity nor the preference shareholding of the petitioners could have been dealt with by the Company or by the other two groups. By a direction dated 01.12.1999 issued by the then Prothonotary of the Bombay High Court, the petitioner, without prejudice to their rights and contentions, actually deposited the original shares of the following Companies together with transfer forms duly signed: (a.) Mahalaxmi Glass Works; 7863 shares (Preference); (b) Kohinoor Glass Factory: 6012 shares (Preference); (c) Westernindia Glass Works: -100 shares (Equity); (d) Commercial and Industry Finance: -1300 shares (Equity); (e)New Delhi Glass Industry: -1904 shares (Equity); It was pointed out that by 01.12.1999 the equity as well as the preference shareholding of the petitioners in Mahalaxmi had already III A/been reduced to nil by the illegal acts of the respondents. The aforesaid directions were passed in the presence of the respondent. This fact was not disclosed/suppressed by the Respondents. The search reports also revealed that in 1999-2000 approximately 25000 equity shares had been issued by the Company divided equally between respondent 2 & 3 in their individual capacity, to the deterrent of the petitioners and without any justifiable reasons. However, the search reports also revealed that no form II is available in the records of the ROC. The search report also revealed that there has been a further issue of 27000 shares in favour of Mahesh Chand, 26000 in favour of Naresh Chand and smaller number of shares in favour of their family members, to the deterrent of the petitioners and without any justifiable reasons. It was also the Petitioners’ contention in the petition that the preference and equity shares of the petitioners were held jointly by all the three partners on behalf of a partnership firm, namely, Keminar Enterprises. Clause 6 of the partnership deed entitles any of the partners to nominate any person to succeed him in the event of his death. Late Shri Ramesh Chand had nominated petitioner No. 2 vide deed of nomination dated 01.01.1975. In the contempt petition filed in December, 2000 respondent No. 2 has taken the stand that since the petitioner had surrendered their shares, they cannot assert any rights or shareholders of intervene in the amalgamation proceedings in relation to Mahalaxmi Glass Works. In this petition also the respondent had deliberately concealed the fact that by 1998-99 the entire shareholding of the petitioner had already been illegally dealt with and reduced to nil by the respondent.
31. Drawing my attention to the other act of oppression/mismanagement it was contended that the respondents are seeking to siphon away properties/assets of the Company to another group Company in which respondents No. 2 & 3 are Directors. The modus j operandi adopted by the respondents are to frame schemes of arrangement, without notice to these petitioner group. The petitioners have tried to intervene in the proceedings but have not been permitted to do so since their name does not appear on the register of members. The petitioners have made a complaint dated 17.05.2004 to the Additional Commissioner of Police (Economic Offence Wing, Bombay).The respondents have sought to illegally transfer the shares belonging to the Late Shri Ramesh Chand Group and have thereby usurped contrary in the shareholding of the Company and have denied rights of the petitioners without complying with their obligations under the arbitration awards. The shares of the petitioners were transferred/issued without proper transfer forms or signatures of the petitioners. The respondents No. 3 Mahesh Chand has been convicted of a criminal offence under Section 420 of the Indian Penal Code. Shri Mahesh Chand was sentenced to imprisonment for one year and also fined Rs. 1000/- on 04.07.2003 by the Special Judicial First Class Magistrate, Hyderabad in CC No. 908/2002. No resolution have been passed by Company for sale of substantial plant or machinery. The respondent No. 2 & 3 have systematically hutched a conspiracy to deferred the Companies’ property to a third party. Findings have already been recorded in this regard by the Bombay High Court in its order dated 17.11.2002 and 10.02.2003, whereby a receiver was appointed to take charge of the affairs of the Company. Respondents had been selling off the lands of the Companies at a gross undervaluation which as per the arbitration agreement is to be sold by the petitioners. They are pocketing the cash received from the sale. And thereby depriving the petitioners from her legal rights. The respondents have deliberately kept the petitioner away from the management and 7 all affairs of the Company. The petitioners have never received any notice for any, General Meeting of the Company. It is an admitted position that the respondent Company is a Family Company and that the petitioner had 1/3rd shareholding and consequent rights and interest and in any event legitimate expectation to be a part of the Company and of its affairs. This has been denied to them.
32. Sh P.V. Kapur, counsel for the respondents argued that the Petitioners have not come with clean hands. In terms of the binding Award, the Petitioners were divested of all interest in Companies in return of compensation as awarded by the Arbitrators and received by them. The proceedings under Section 397 are equitable in nature and so as an equity court the CLB should dismiss the same since the Petitioners have flouted the binding Awards and approached the CLB to overcome the said Award which proves that the hands of the Petitioners are not clean. The CLB must follow the common law principle that he who seeks equity must do equity. In this connection, reliance was made on the decisions: in the cases of “Chetak Construction Ltd. v. Om Prakash and Ors. , wherein it has been held that “A litigant cannot be permitted “Choise” of “the Forum” and every attempt at “forum-shopping” must be crushed with a heavy hand,” “Srikanta Delta Narasimharaja Wadiyar v. Sri Venkatewara Real Estates Enterprises (Pvt.) Ltd., and Ors. reported in (1991) 72 CC 211, wherein it has been held at Page 241 that “even assuming that the allegations of the Petitioner, if proved, do make out a case of oppression and mismanagement within the scope of Section 397 and 398 of the Act, mere proof of those allegations will not entitle the Petitioner to the reliefs sought for when relief are discretionary reliefs and they will be granted only to persons who approach this Court in good faith and the parties who approach this Court for equitable reliefs must come with a clean record”.
33. Further, it was pointed out that the rights of the Petitioners spring from the Award and if any of the directions of the Award have not been adhered to by any Company then the Petitioners should move the appropriate court for execution of the Award instead of filing Petition under Sections 397 and 398 of the Act. When the Petitioners have sufficient and efficacious remedy available to them, they cannot be allowed to agitate the matter before the CLB. In fact, two execution proceedings have commenced for enforcement of two of the Awards namely, the Seri Lingampally Award and the Miyapur Award by the Petitioners in Hyderabad which are pending. By filing the two execution petitions, the petitioners have by their action conceded that each decree is separate and separately executable, independently of the other decrees. Hence by now linking the separate decrees, they are contradicting their own stand. Responding to the petitioner’s contention that all the five awards are to be read and implemented conjointly, non fulfilment of one of awards by the respondents will not entitle them the fulfillment of the other awards, mainly the final and the fifth award, the Respondents had no complied with award relating to Hyderabad Property and, therefore, the petitioner are justified in not complying with the terms of the fifth and final award and consequently the petitioners continued to be the shareholders of the company, the counsel for the respondents contended that the petitioners such contentions are basically unsustainable on facts and in law. It was reiterated that five separate decree was passed by the Bombay High Court in respect of five awards. All the five decrees can neither be implemented con-jointly nor be combined or consolidated or merged or amalgamated, each decree has to be enforced independently without recourse to other decrees. fit was pointed out that in fact the petitioners had taken execution proceedings in Hyderabad in respect of two of the decrees passed on the award relating to Hyderabad Property which showed that the petitioners themselves had never believed the decrees to be a consolidated one but separate ones. It was argued that to have the decrees combined is only an after thought of the petitioners with a view to come back into the companies. Referring to Section 2(2), 47, 96 and order XXI Rule 9 of the CPC it was argued that the CPC recognizes each decree to be a separate decree which can in no situation be combined with other decrees, even if some of the separate decree are passed at the same time. There is no legal concept of a combination of several decrees passed on several separate suits awards in respect of different subject matter. The counsel for the respondents relied on the decision in the case of Sardar Amarjit Singh Kalra (Dead) by LRs. Pramod Gutpa (Smt.) (Dead) by LRs and Ors reported in [(2003) 3 SCC 272], the Supreme court has observed in relation to joint decrees etc. that the question as to whether in a given case the decree is joint and inservable or joint and severable or separable has to be decided only for the purposes of abatement or dismissal of the entire appeal as not being properly and duly constituted or rendered incompetent for being further proceeded with and for no other purposes. The decree passed in respect of different awards, even when the parties are the same cannot be combined together at a later stage after passing of all such decrees just because of the argument that known execution of one decree would make others known executable since each decree besides separate rights of the parties which can under no circumstances become defeaseable rendering thereby all the legal process involved in the proceeding where the decrees were passed as near futile exercises. The petitioners’ contentions in this behalf are patently illegal and wrong.
34. The respondents stand is that the petitioner’s contention is erroneous firstly because all the five awards are separate and independent dealing with different subject. These cannot be interfered with or joined together for any purpose and secondly, in view of Sections 31, 32 and 33 of the Arbitration Act, the Company Law Board cannot adjudicate either the objections to any of Awards or, interpretation of the agreement to refer the disputes to arbitration as the jurisdiction to entertain the same exclusively vests in the Competent Court in which Award had been filed and no other Court or Company Law Board. In the present case the Competent Court has already heard the objections of the petitioners to the Award and has adjudicated on the same and appeal against the same was carried upto the Supreme Court and, the Supreme Court had also dismissed the appeal. The Bombay High Court has considered the matter seven times and even it has been considered by the Supreme Court three times. All possible objections to the Final Award having been rejected by the Courts the petitioners cannot expect any further relief from any Court. By the present petition before the Company Law Board the petitioners cannot invite the Company Law Board to decide the question, which have been concluded by the order of the Competent Courts. The petitioners cannot raise same or other objections again before the Company Law Board.
35. Responding to the petitioner’s reliance on the judgment of the Supreme Court in the case of Sangramsinh P. Gaekward and Ors. v. Shantadevi P. Gaekwrd to contend that the Company Law Board alone had jurisdiction to entertain an application under Sections 397 ad 398 of the Companies Acand the jurisdiction of the High Court was ousted thereby and thus the allegations Vrnactein the company petition could not be the subject matter of the adjudication by Ly the High Court the counsel for the Respondents contended that it is correct that the jurisdiction to adjudicate petition under Sections 397 and 398 of the act vests in Company Law Board, however, the Company Law Board in exercise of its said jurisdiction cannot re-adjudicate the issues already decided by the Court of competent jurisdiction. It was further pointed out that in the present case the issue whether the petitioners had any interest left in the shareholding of the companies of not was heard by the High Court of Bombay and it specifically held that the petitioners do not have any semblance of any right in the companies, the said findings of the High Court has finally adjudicated that the petitioners had no interest of any nature whatever in the companies.
36. It was argued that the Personal grievance, if any, cannot form the subject matter of proceedings under Sections 397 and 398 of the Act. It was pointed out that the Petitioners have made several allegations in the Petition which are relating to individual. The plain reading of Section 397 indicates the object of the Section is to prevent an existing present status of prejudicial oppressive harsh and unfair conduct. If the affairs which are complained of in the Petition are not being conducted in presenti as at the time of filing the Petition under Section 397 they are matters of past and cannot be the subject matter of proceedings under Sections 397 and 398 of the Act. In the present Petition there is no iota of evidence of prejudicial oppressive or unfair conduct in carrying on the business of the Company. There are, however, baseless allegations against individual persons which cannot be subject matter of a Petition under Sections 397 and 398 of the Act. Palghat Exports Pvt. Ltd. v. T.V. Chandran (1994) 79 Company Cases 213 (Kerala) refer.
37. Further, it was argued that the Petition relates to matters of 1998. The Petition has been filed in the year 2006. There has been considerable delay in making this Petition. Even if the provisions of Limitation Act are not applicable to proceedings before the Company Law Board yet there is an abnormal delay in bringing the matter before the Company Law Board and on this ground alone, the Petition should be dismissed. A.P. Jain v. Faridabad Metal Udyog Pvt. Ltd. (1999) 95 Company Cases Page 76. 11.2 Delay and latches are fatal to the proceedings. It was contended that the Company Law Board should take into account that the Petitioners have come before it after a lapse of more than 8 years. There is no plea for condoning delay and latches on the part of the Petitioners in initiating proceedings before the Company Law Board. Union of India v. R.C. Bhargav 1998 CLJ Page 374.
38. Further, it was argued that there has to be finality of disputes. Since 1988 the Petitioners are indulging in litigation The share of Late Ramesh Chand, Husband of Mrs. Suruchi Chand and father of two other Petitioners was determined in 1994 and 1996 in the case of lands in Hyderabad and in 1996 in respect of all the companies. Full compensation was paid. The matter went up to the Supreme Court and the Petitioners lost all rounds. The Award of the Arbitral Tribunal became final. The competent court of law made the Award the “Rule of the Court”. As between the parties and their privies, an award is entitled to that respect which is due to a judgment of a Court of last resort. When the Award becomes final it puts an end to all the controversies between the parties and the points which are taken either in the attack or defence cannot be reagitated. Aftab Begum v. Hazi Abdul Majid Khan AIR 1924 Allahabad Page 800 and Lala Pannalal v. Rup AIR 1945 Oudh Page 92 (DB). Yet the Petitioners have not allowed a day of peace to the Respondents even after full compliance of all the Awards by the Respondents and the Petitioners having received all the benefits under the Awards. They are doing this in defiance and violation of the Final Award (Fifth Award) which clearly states that there will be no interference from the Petitioners. For their actions, it was prayed that the Petitioners should be awarded exemplary punishment by way of substantial punitive costs on them to deter them from such vexatious litigation in future.
39. It was argued that the matter before the Company Law Board is hit by the doctrine of conclusiveness and finality in judicial proceedings. It was contended that it is well settled principle of law that repeated litigation between the same parties dealing with the same subject matter must be avoided. A “shocking multiplication” of legal proceedings has to be avoided. The Petitioners have been in litigation with the Respondents in respect of the same subject matter since 1988. My attention was drawn to a long list of various Judgments, Decrees and Orders passed by the Arbitral Tribunal, Bombay High Court and Supreme Court contending that it establishes beyond doubt that the Petitioners lost throughout in these proceedings yet are agitating the same issues before the Company law Board. It was pointed out that Arbitration Final Award (Fifth Award) dated 14th September, 1996 by the Arbitral Tribunal was challenged before (i) Bombay High Court: Order of the single Judge Shri V.R. Datar, J, dated 23rd January, 1998 dismissed the Petition field by the Petitioners challenging the Final Award dated 14th September, 1998; (ii) Bombay High Court Order dated 2nd April, 1998 of the division Bench, Coram: Shri M.B. Shah, C.J., and Shri A.Y. Sakhare, J. dismissed with costs and Petitioners’ Appeals against the Order of the learned Single Judge dated 23rd January, 1998; (iii) Bombay High Court Order dated 27th April, 1998 Coram: Smt. K.K. Baam, J., lifted the stay on the Decree ordered and stayed for Appeal by Shri V.R. Data, J. of the Bombay High Court in his order dated 23rd January, 1998 and ordered that the Decree in terms of the Final Award (Fifth Award) was made the Rule of the Court; (iv) Supreme Court: Order of Justice A.S. Anand and Justice V.N. Khare dated 18th August, 1998 confirmed the Final Award (Fifth Award), but awarded additional Rs. 5 lakhs as interest to each of the three Petitioners; (v) Supreme Court Order dated 15th March, 1999 by the Hon’ble Chief Justice of India and Justice Shri M. Jagannadha Rao and Justice Shri N. Santosh Hegde in a Review Petition after hearing counsel permitted the Petitioners to withdraw their SLP.
40. Further, it was pointed out that petition filed by Respondents in Bombay High Court for amalgamation of Unit of one of their companies with The Mahalakshmi Glass Works Pvt. Ltd., the Petitioners intervened and objected to the amalgamation claiming to be shareholders. It was pointed out that (i) Bombay High Court vide Order dated 8th November, 2000 by Smt. K.K. Baam, J, rejected the Intervention Application filed by the Petitioners; (ii) Bombay High Court vide Order dated 17th January, 2001 Coram: Dr. D.Y. Chandrachud, J, rejected the contentions of the Petitioners and approved the Scheme of Amalgamation;(iii) Bombay High Court vide order dated 23rd April, 2001 of the Division Bench Coram: Shri B.N. Srikrishna and Smt. Nishita Mhatre JJ dismissed the Appeal filed by the Petitioners and also rejected Application for further stay of the scheme; (iv) Bombay High Court vide order dated 7th October, 2003 of Shri R.J. Koshr and Smt. Nishita Mhatre JJ dismissed the Review Petition filed by the Petitioners; (v) Supreme Court: Coram: Hon’ble Mr. Justice R.C. Lahoti and Hon’ble Mr. Justice D.M. Dharmadhikari by order dated 22nd March, 2004 dismissed the SLP filed by the Petitioners against the Appeal order dated 23rd April, 2006 and in review dated 7th October, 2003 of the Bombay High Court.
41. Considering the issue of maintainability of these petitions under Sections 397/398 read with Section 399 of the Act in view of the pleadings, the documents annexed therewith, the arguments and the case laws relied upon by the parties, I find that these petitions are not maintainable. The petitioners have failed to refute the contentions of the respondents regarding preliminary objections on the maintainability of these petitions. I find that each of these preliminary objections is sufficient to disentitle the petitioners to maintain these petitions. In the facts and circumstances of the present cases, the petitioners have no locus. By no stretch of imagination they can be considered to be members in the Respondent companies to be able to maintain their. allegations of oppression and mismanagement. The petitioners are the legal heirs of Late Ramesh Chand who held 1/3rd share in these companies jointly with his brothers namely Sh. Mahesh Chand and Sh. Naresh Chand. The deceased did not hold equity shares in individual name. On his demise, the equity shares jointly held by the three brothers vested in the surviving co-owners. The petitioners though the only legal heirs could not have inherited any equity shares in any of these companies. The petitioners by themselves never held any equity shares in these companies. As regards the preference shares of the Ramesh Chand Group, the same had to be compulsorily redeemed in compliance with the relevant provisions of the law by 15 June 1998. These were redeemed on 11th June 1998. The R.C. Group had already been paid off by the Companies in terms of the Final Award dated 14.9.1996 for the deceased’s 1/3rd share in the businesses. The consideration was accepted and received. The redemption amount pertaining to the preference shares was paid to MC and NC Group as a consequence of the Final Award. It was not a usual transfer. This was a transfer by order of Court. After paying off the petitioners as per the Award, the remaining shareholders were MC and NC groups. Even the petitioners’ attempt to intervene in the proceedings Under Section 391 and 394 for sanction of a Scheme of Arrangement between the KGF and MGW claiming right in the shareholding of MGW failed as it was held by the Bombay High Court that the interveners were seeking to intervene in the scheme without a semblance of any right in the petitioner company. Double Bench dismissed the petitioners’ appeal. In review petition it was observed that the appellants did not continue to hold rights in the companies as shareholders. The SLP was also dismissed. In the present cases, I find that the 1/3rd of the share representing the interest of the petitioners was transferred by the shareholding companies to the MC and NC Group in compliance with the Final Award as decreed. The petitioners are not shareholders in any sense of the term. Since the petitioners are not members, they have no rights and interest of members in these companies to be able to complain of lack of probity or unfair conduct of the respondents, if any, being prejudicial to the petitioners in their legal and proprietary rights as shareholders. The provisions of Sections 397/398 of the Act cannot be attracted in the present petitions.
42. I. Having held that the petitioners have no locus, the question of ascertaining whether they have the requisite qualification under Section 399 of the Act does not even arise. Nor do they have it. The deceased had no equity shares in individual name. He had 7863 preference shares in individual name, 470 preference shares in joint holding, and 334 joint equity holdings for which consideration was paid in accordance with the Award decreed and complied with. The petitioners are not shareholder of these companies. I find no justification for maintenance of these petitions under Sections 397/398 read with Section 399 of the Act. In this view of the matter, their allegations regarding increase in the share capital and issuance of further shares to the MC and NC group subsequent to the payment of consideration of RC group’s 1/3rd shareholding in the companies as per the Award becomes baseless. In view of the foregoing the petitioners’ allegations that they were illegally kept out of the management and assets of the companies, that the transfer of shares was illegal and unlawful, it was in direct violation of the Articles of Association and in violation of the Articles of Association and in violation of Sections 84, 101 to 104, 108 and 111/111A of the Act, the Awards were not implemented, no consideration was paid to the petitions, payment before the Awards was not possible, after the Awards no payment was made, in compliance with the Awards the Respondent had to give the petitioners power of attorney which was never given on the contrary, in the execution proceedings the Respondents’ pleading was at the land cannot be sold which is dishonest legal plea as there are two documents on record showing sale deeds, before the arbitrator the Respondents did not disclose the facts that there were encroachments and it was not possible to sell the lands, the petitioner were never Permitted to sell the land, CIF was disposing of the property can by no way be considered by the Company Law Board. The petitioners further plea that all Awards are interrelated which are part of the final award which among other matter relates to the transfer of impugned shares, complete directions were given in para 48 of the final Award, language used is much wider than what is used in para 43, these Award are not execution proceedings the Respondents’ pleading not exclusive of each other, by the final award the other three interim Awards were co-related with the final award, consent terms also Say so, Arbitration Awards have given certain rights, the Award does not contemplate automatic transfer of shares, there was was no need for giving the blank transfer deeds, there was no need to give the shares to the Prothonotary in Bombay High Court, till date no such transfer deeds have been placed before the management of the companies relating to transfer, this in not a position in law, can by no way confer jurisdiction on the Company Law Board to consider the petitioners objections to the Award. The Petitions reliance on the cases cited to support their contentions, specifically the contention that the Company Law Board adjudicate this matter as due process of law has not been followed, assuming that the contention is teanable, does not confer, and it cannot confer jurisdiction in this matter on the Company Law Board which lacks it in clear terms in the given facts and circumstances of these cases.
43. I hold that the Company Law Board lacks jurisdiction in this matter. The Company Law Board has no jurisdiction to entertain and adjudicate the present petitions under Sections 397, 398 as there is Arbitration Agreement between the parties. All the rights of petitioner flow and originate from the Award decreed. The Awards have attained finality. The present petitions by the petitioners are only camouflaged into 397, 398 petitions. All prayers in the petition can be decided by the competent court as the principal matter originates from the Arbitration only. The controversy sought to be raised in the present petition has originated and emanated from the Arbitration. The existence of Arbitration Agreement is not denied. The subject matter of the petitions is the same as the subject matter of the arbitration agreement. This Board has to only examine whether all the parties to the petitions as a whole could be referred to arbitration. In the present case there is commonality of parties, they can be referred to arbitration. Judicial authority is entitled to, has to and is bound to decide the jurisdictional issue raised before it. In other words, it has to decide whether there is a valid agreement and whether the dispute that is sought to be raised before it is covered by arbitration agreement.
44. In the recent times a test has evolved in various judgments of the Company Law Board for instance in Naveen Kedia and Ors v. Chennai Power Generation Ltd. and Ors. (1998) 4 Comp LJ 128 (CLB); Escorts Finance Ltd. v. G.R. Solvents and allied Industries Ltd. Ors. (1999) 96 Comp Cas 323 (CLB) and Pinaki Das Gupta v. Maadhyam Advertising (P) Ltd. (2003) 114 CC 346 which is “whether the matter in a petition under 397/398 is to be relegated to arbitration is to examine as to whether the allegations of oppression/mismanagement contained therein can be adjudicated without reference to the terms of the arbitration agreement. If it can be, then the question of referring the matter to arbitration does not arise even if the agreement covers the same matter.” When all issues raised in the petition are covered by the arbitration agreement, the matter has necessarily to be referred to arbitration. Examining the respondents’ claim on the touchstone of the tests applied by the Company Law Board, I find that they pass all the tests. These petitions are not maintainable in view of the fact that admittedly there is Arbitration Agreement; there are decrees in respect of all the awards given. The awards have attained finality after having been repeatedly challenged before the High Court and the Apex Court. There is commonality of parties as well as the matter in issue. The Company Law Board by no way can make an attempt to adjudicate on the allegations made and grant the prayers of the petitioners without referring to the Arbitration Agreement which, in fact, and in law has been accepted, complied with by the petitioners. In the present proceedings even the contentions of the petitioners have been that the parties and even the Arbitrators are bound by the terms of the Arbitration Agreement. They also admit that the Awards which were converted into consent decrees were challenged by the petitioners upto the Apex Court. The matter in issue already stands decided by the competent court. At this stage there is no way that the Company Law Board can assume jurisdiction after eight years of delay and latches to adjudicate on these allegations and accept the petitioners’ contentions that the award are interlinked and till such time the petitioners are paid the value of their 1/3rd share in the said businesses including the Hyderabad Properties and the value of their interest to the extent of 28% in the businesses of WIG, despite their having accepted and received the consideration paid through the court in compliance with the Arbitration in the matter, they still hold 1/3rd share in the businesses and their connection with the companies, firms and AOPs and WIG cannot be severed and they have not lost their rights and interests in the management of the companies.
45. Further, I find that these petitions suffer from the vice of inordinate delay and latches of more than eight years. The matter of the past pertaining to the year 1998 can by no way be entertained in the present proceedings initiated in the year 2006. Besides unexplained considerable abnormal delay in the matter, there is not even a prayer made for condonation of delay which in itself disentitles the petitioners to claim any relief in the matter. Furthermore, there is no answer to the respondents’ allegation of unclean hands pointing to the oblique motive of the petitioners to overcome the Awards which have attained finality. The petitioners are in litigation since 1988. The respondents wonder as to what happens to the doctrine of conclusiveness and finality in judicial proceedings. It is well settled principle of law that repeated litigation between the same parties dealing with the same subject matter must be avoided. There has to be finality of the dispute. Even if the Award(s) is (are) not complied with the Company Law Board is not the forum.
46. In this view of the matter, the petitioners’ contentions and reliance on the cases cited is a futile attempt to somehow get under the jurisdiction of Company Law Board and thus indirectly endeavor to get orders as per their wishes and undo the consequences of the Awards which have already attained finality. And this attempt is made after having accepted the Awards, after having received the benefits and having utilized the consideration received in this behalf.
47. There is no answer given to the principles of acquiescence, waiver, estoppel, res judicata which are obviously and undoubtedly applicable in the present cases. The same claim cannot be raised again and again between the same parties. This principle extends to all matters of law and fact which the decision necessarily establish as the foundation of the conclusion reached by the judicial pronouncement in the present cases. It is well established principle of law that any judgment or order or decree of a judicial authority concludes not merely as to the point actually decided but as to the matter which it was necessary to decide, and which was actually decided. The Company Law Board has no jurisdiction to review the correctness of any of the orders passed by the competent Courts in the matter. Arbitration Agreement is dated 3.1.1989 which was confirmed by the Bombay High Court on 31.1.1989. Three independent awards made on 2.4.1994 were made Rule of the Court on 9.2.1995. Three separate decrees were passed. The Fourth Award dated 20.2.1996 became Rule of the court on 22.7.1996, separate decree was passed. The Fifth Award dated 14.9.1996 also confirmed the Four Awards. The Petitioners objected to the Fifth Award. Objection petition under Sections 16, 30, 33 of the Arbitration Act was considered and rejected by the Bombay High Court. The Fifth Award was also made Rule of the Court on 23.1.1998. Appeal to the Double Bench got dismissed. The SLP was also dismissed on 18.8.1998 making modification only to the extent that an additional sum of Rs. 5 lakhs be paid to the petitioners. The review petition was rejected. The fifth Award dated 14.9.96 also became the Rule of Court and a Fifth decree was passed. The Awards having been decreed have become final and binding between the parties. Petitioners have received payment for 1/3rd share in the businesses through the court after having accepted the Award Decreed.
48. The petitioners have no locus standi, no qualification under Section 399 of the Act, the allegations made in these petitions cannot be adjudicated without reference to the Arbitration agreement. The points of alleged non-compliance in the fourth award or in any award for that matter do not empower the Company Law Board to undo the effects of Arbitration or get the compliance made. Only the competent court can do that. Besides, there is uncondonable delay and latches in the matter. The petitioners cannot approbate and reprobate. They cannot take advantage and benefits of Awards which merged into the judgment and orders of High Court and Supreme Court, and then challenge the Awards, directly or indirectly. It is well settled principle decided by a number of judicial decisions that a person acting in terms of an order or Decree of a competent Court and taking the benefit thereunder cannot challenge the correctness and/or validity of order or Decree or judgment at a subsequent stage. The petitioners are seeking a review or enforcement or execution of the Awards which is not permissible, it is not within the competence of the Company Law Board.
49. In view of the foregoing, these petitions are hereby dismissed being not maintainable. All CAs stand disposed off. All interim orders stand vacated. No order as to cost.