{"id":140652,"date":"2002-08-09T00:00:00","date_gmt":"2002-08-08T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/d-k-oswal-and-ors-vs-mr-akshay-finance-and-ors-on-9-august-2002-2"},"modified":"2016-04-14T21:43:16","modified_gmt":"2016-04-14T16:13:16","slug":"d-k-oswal-and-ors-vs-mr-akshay-finance-and-ors-on-9-august-2002-2","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/d-k-oswal-and-ors-vs-mr-akshay-finance-and-ors-on-9-august-2002-2","title":{"rendered":"D.K. Oswal And Ors. vs Mr. Akshay Finance And Ors. on 9 August, 2002"},"content":{"rendered":"<div class=\"docsource_main\">Delhi High Court<\/div>\n<div class=\"doc_title\">D.K. Oswal And Ors. vs Mr. Akshay Finance And Ors. on 9 August, 2002<\/div>\n<div class=\"doc_citations\">Equivalent citations: 2003 115 CompCas 577 Delhi, 2004 50 SCL 303 Delhi<\/div>\n<div class=\"doc_author\">Author: V Sen<\/div>\n<div class=\"doc_bench\">Bench: V Sen<\/div>\n<\/p>\n<pre><\/pre>\n<p>JUDGMENT<\/p>\n<p>  Vikramajit Sen, J.  <\/p>\n<p>  CA 641\/2002 &amp; 642\/2002 <\/p>\n<p> 1. Allowed, subject to all just exceptions.\n<\/p>\n<p>  CA 685 &amp; 686\/2002 in CP 21\/1986 <\/p>\n<p> 2. Mr. Chandiok, Learned Senior Counsel for the<br \/>\nRespondents, states that the applications may be allowed,<br \/>\nsubject to all just exceptions. Ordered accordingly. The<br \/>\namended applications are taken on record.\n<\/p>\n<p>  CA 639\/2002, 640\/2002, 707\/2002 IN cp 21\/1986 <\/p>\n<p> 3. In order to fully appreciate the facts and<br \/>\nissues that have been brought into focus in the context of<br \/>\nthe reliefs prayed for these applications, it is necessary<br \/>\nto make a precis of the annals of this family litigation.<br \/>\nShri D.K. Oswal filed Petitions CP Nos. 21\/1986 read<br \/>\nwith Rule 9 of the Company (Courts) Rules, for the<br \/>\nrectification of the Register of Members of the Companies<br \/>\nwhich were controlled by the Oswal family. These Companies<br \/>\nwere Akshay Finance and Trading Company, Pras Finance and<br \/>\nTrading Company, Arihant Investment and Trading Co., Victor<br \/>\nInvestment and Mercantile Co., Ambar Investment and<br \/>\nMercantile Co. and Adinath Investment and Trading Company.<br \/>\nAt that point of time four Public Limited Companies were<br \/>\nalso under the Oswal Family&#8217;s management, i.e. M\/s.<br \/>\nVardhman Spinning &amp; General Mills Limited, Mahavir Spinning<br \/>\nMills Ltd., Sriyans Paper Mills Ltd. and Adinath Textiles<br \/>\nLimited. It is not in dispute that Vardhman Polytex was<br \/>\nnot in existence in 1987 and was, therefore, not within the<br \/>\npurview of those Company Petitions. In those petitions the<br \/>\nfather of the Petitioner, namely late Shri R.C. Oswal, and<br \/>\nthe Petitioner&#8217;s two brothers A.K. Oswal and S.P. Oswal<br \/>\nwere arrayed as Respondents. They put up a common<br \/>\nresponse\/defense in all the petitions.\n<\/p>\n<p> 4. After one year of the pendency of those<br \/>\nPetitions, a settlement was brought about by Hon&#8217;ble Mr.<br \/>\nJustice B.N. Kirpal (as the Learned Chief Justice of India<br \/>\nthen was) in terms of his Order dated August 12, 1987. It<br \/>\nis not of only little significance that the opening<br \/>\nsentence and paragraph of this judgment reads as<br \/>\nfollows, (underlining added for emphasis).\n<\/p>\n<p>  &#8220;This judgment will  dispose of Company<br \/>\nPetition Nos. 21 of 1986 to 26 of 1986.&#8221;\n<\/p>\n<p> 5. A perusal of the afore-mentioned judgment<br \/>\ndated August 12, 1987 will make it abundantly clear that<br \/>\nthere were two groups before the Court, that of the<br \/>\nPetitioner\/Shri K.K. Oswal on one side and his father and<br \/>\nhis two brothers on the other. No further fragmentation in<br \/>\nthe second group was either pleaded or had manifested in<br \/>\nitself in any manner whatsoever.\n<\/p>\n<p> 6. The applications under consideration have been<br \/>\nmoved in Co. Petition No. 21\/1986 above, but I do not<br \/>\npropose to stand on strict technicalities and shall assume,<br \/>\nwherever necessary, that reference has been made to all the<br \/>\nerstwhile petitions viz. C.P. Nos. 21 to 26\/1986. It is<br \/>\nimperative to mention that all the Companies in<br \/>\ncontemplation in the earlier Petitions had their registered<br \/>\noffices at 205 Surya Kiran Building, kasturba Gandhi Marg.<br \/>\nNew Delhi. The prayer contained in CP 21\/1986 was as<br \/>\nfollows:-\n<\/p>\n<p>&#8220;Prayer  <\/p>\n<p> It is, therefore, most<br \/>\nrespectfully prayed that the illegal<br \/>\nredemption of:-\n<\/p>\n<p> (i) 2630 4% non-cumulative redeemable.<br \/>\npreference shares of the Company;<br \/>\nand  <\/p>\n<p> (ii) 30 eight percent preference share<br \/>\nof the Company belonging to the<br \/>\nPetitioners be declared illegal,<br \/>\nin-operative and being void in<br \/>\nin law and the Register of Members<br \/>\nof the Company be rectified by<br \/>\ninserting therein the names of the<br \/>\nPetitioners as holders of the<br \/>\naforesaid shares.\n<\/p>\n<p> Costs of Petition be allowed to the<br \/>\nPetitioners:\n<\/p>\n<p> Any other order deemed fit and<br \/>\nproper in the circumstances of the<br \/>\ncase be also made.&#8221;\n<\/p>\n<p> 7. Mr. Jayant Bhusha, Learned Counsel appearing<br \/>\nfor the Applicants in CA 639\/2002 and 702\/2002 has relied<br \/>\nheavily on the previous order passed on 6.5.1986 in the<br \/>\nearlier proceedings so as to emphasise that the division<br \/>\nand severance which took place was not just between Shri<br \/>\nD.K. Oswal and the rest of the family, but also<br \/>\nindividually between the father late Shri R.C. Oswal and<br \/>\nhis three sons namely, Shri D.K. Oswal, Shri A.K. Oswal<br \/>\nand Shri S.P. Oswal\/Respondent. This order is reproduced<br \/>\nverbatim since separate portions thereof have been relied<br \/>\nupon by the opposite parties. Mr. Bhushan has relied on<br \/>\nparagraph 1 which mentions that the four branches of the<br \/>\nfamily shall have 25% interest each. On the contrary Mr.<br \/>\nChandiok has relied on paragraph 5 since it mentions that<br \/>\nthe interests of Shri D.K. Oswal were being separated from<br \/>\nthe rest of the family.\n<\/p>\n<p> &#8220;President : Mr. Shanti Bhushan Sr. Advocate<br \/>\nwith Mr. G.L. Rawal and Mr. K.M.<br \/>\nSharma, for the petitioner.<br \/>\nMr. Kapil Sibal, Sr. Advocate with<br \/>\nMr. S.S. Shroff and Mr. Pinaki<br \/>\nMisra, for the respondent.\n<\/p>\n<p>  CP Nos. 21 to 26 of 1986<\/p>\n<p> It is indeed gratifying to note<br \/>\nthat the parties are agreed to the manner<br \/>\nin which the disputes between them are to<br \/>\nbe settled.\n<\/p>\n<p> The agreement is that the share of<br \/>\neach o the four branches involved in this<br \/>\ncase, namely, the petitioner, his father<br \/>\nand his two brothers, should be deemed for<br \/>\nworking the settlement as being equal.<br \/>\nThe total value of the family&#8217;s holdings<br \/>\nin the various business concerns will be<br \/>\nascertained and thereafter the interest of<br \/>\nthe petitioner and his family members<br \/>\nshall be separated. Payments made to any<br \/>\nof the family members either from<br \/>\ninvestment companies or trusts or<br \/>\notherwise for alleged<br \/>\nredemption\/cancellation of shares shall be<br \/>\nproperly adjusted.\n<\/p>\n<p> The parties are agreed that in<br \/>\norder to bring about a settlement between<br \/>\nthe parties, the various members of the<br \/>\nfamily should file in Court undertakings<br \/>\nby way of affidavits which would spell out<br \/>\nthe terms of the agreement between them and<br \/>\nwould also bind each one of the deponent.<br \/>\nThe affidavits by way of undertakings<br \/>\nwhich would be filed by all the members of<br \/>\nthe family would be to the following<br \/>\neffect:&#8211;\n<\/p>\n<p> 1. The deponent will accept that for<br \/>\nthe purpose of settling the<br \/>\ndispute, the four branches of the<br \/>\nfamily, namely, the petitioner,<br \/>\nhis two brothers and father, have<br \/>\n25% interest each.\n<\/p>\n<p> 2. The value of the total<br \/>\nshareholding of the family<br \/>\ndetermined on the basis of net<br \/>\nworth of the companies as on 31st<br \/>\nMarch, 1986 held in the name of<br \/>\nthe members of the family or<br \/>\nthorough their investment companies<br \/>\nin the four companies, namely,<br \/>\nVardhman Spinning &amp; General Mills<br \/>\nLtd., Mahavir Spinning Mills Ltd.,<br \/>\nSriyans Paper Mills Limited<br \/>\nand Adinath Textiles Limited, will<br \/>\nbe determined as on 31.3.86.\n<\/p>\n<p> 3. The value of the family&#8217;s total<br \/>\nshareholding as on 31st march,<br \/>\n1986 in the aforesaid companies<br \/>\nwill be determined on net worth<br \/>\nbasis by M\/s. S.B. Billimoria &amp;<br \/>\nCompany, Chartered Accountants.<br \/>\nThey shall value the shareholding<br \/>\nafter giving opportunity of<br \/>\nhearing to all the parties. The<br \/>\nreport to be submitted by M\/s.<br \/>\nS.B. Billimoria &amp; Co. will be<br \/>\nsubject to confirmation\/adoption,<br \/>\nwith or without modification, by<br \/>\nthe Court.\n<\/p>\n<p> 4. The deponent will undertake to<br \/>\nthis Court that he will not<br \/>\nchallenge, by way of appeal or<br \/>\notherwise, the valuation as<br \/>\nfinally determined by the Court.\n<\/p>\n<p> 5. Upon determination and<br \/>\nconfirmation of the valuation by<br \/>\nthen Court, the parties agree that<br \/>\nthe Court shall decide the manner<br \/>\nin which the interest of the<br \/>\npetitioner is to be separated<br \/>\nfrom the interests or rest of the<br \/>\nfamily and the decision so arrived<br \/>\nat shall be final and binding on<br \/>\nall the parties. In order to<br \/>\nassist the Court in arriving at<br \/>\nthis decision, the Chartered<br \/>\nAccountants shall not only value<br \/>\nthe family&#8217;s total shareholdings<br \/>\nin the said companies but they<br \/>\nshould also submit to the Court<br \/>\ntheir report containing<br \/>\nconclusions as to the net worth of<br \/>\neach of the four companies as on<br \/>\n31st March, 1986.\n<\/p>\n<p> 6. The parties undertake, when called<br \/>\nupon to do so by the Court, to<br \/>\ntransfer the shares etc. in order<br \/>\nto give effect to the order of<br \/>\nseparation. Any transfer of<br \/>\nshares necessary in the process of<br \/>\nsettlement, will be subject to<br \/>\nsuch approvals or the Financial<br \/>\nInstitutions as may be required<br \/>\nunder the various agreements and<br \/>\nundertakings to them. The<br \/>\ndeponent undertakes to take all<br \/>\nnecessary steps to obtain such<br \/>\napprovals. In the meantime the<br \/>\nsuits, appeals and criminal<br \/>\ncomplaints as are pending today<br \/>\nwill be stayed till further orders<br \/>\nof the Courts.\n<\/p>\n<p> Affidavits in the aforesaid terms<br \/>\nshould be filed in Court by all the<br \/>\nmembers of Oswal Family who have shares in<br \/>\ntheir names directly or indirectly within<br \/>\nten days from today and the case be listed<br \/>\nin Chamber on 16th May, 1986 at 4 P.M.\n<\/p>\n<p>Sd\/- B.N. Kirpal  <\/p>\n<p>Judge.\n<\/p>\n<p> May 6, 1986.&#8221;\n<\/p>\n<p> 8. Even on a bare reading of the afore-mentioned<br \/>\norder I am unable to subscribe to the view proposed by Mr.<br \/>\nBhushan that the Court had divided and partitioned the<br \/>\nshares of late Shri R.C. Oswal and each of his three sons<br \/>\nin equal shares of 1\/4th each. The division that was<br \/>\npostulated even on 6.5.1986 was a severance of the 1\/4th<br \/>\nshare of Shri D.K. Oswal from the Oswal Family fortunes.<br \/>\nThough this is the tenor of the orders passed by Hon&#8217;ble<br \/>\nJustice B.N. Kirpal, this is apparent on a perusal of the<br \/>\nfollowing extracts from the judgment dated 12th August,<br \/>\n1987:-\n<\/p>\n<p> &#8220;In order to give effect to<br \/>\nseparation of petitioners&#8217; interests from<br \/>\nthe rest of the family, necessary<br \/>\ndirections have to be issued so as to<br \/>\nensure that shares of Vardhman and Mahavir<br \/>\nheld by D.K. Oswal and his associates are<br \/>\ntransferred in favor of R.C. Oswal Group<br \/>\nand, at the same time, shares of Shreyans<br \/>\nand Adinath held by R.C. Oswal, S.P.<br \/>\nOswal and Ashok Oswal and their group be<br \/>\ntransferred in favor of D.K. Oswal and<br \/>\nhis nominees. Appropriate directions have<br \/>\nalso to be issued with regard to the<br \/>\ndivesting of shares of Shreyans by<br \/>\nVardhman as has been proposed by the<br \/>\nrespondents in their written arguments.\n<\/p>\n<p> The transfer of shares which are<br \/>\ninvolved, to give effect to the aforesaid,<br \/>\nas has been indicated by the respondents,<br \/>\nis as follows:-\n<\/p>\n<p>&#8220;A SHARE\u00a0\u00a0\u00a0 TRANSFERS\u00a0\u00a0<br \/>\nINVOLVED\u00a0 FROM RESPONDENTS\u00a0<br \/>\nTO\u00a0 SHRI O.K.OSWAL AND<br \/>\nHIS GROUP<\/p>\n<p>I.\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\n<\/p>\n<p>SHREYANS PAPER MILLS LIMITED <\/p>\n<p>I-A:\n<\/p>\n<p>DIRECT HOLDING OF THE RESPONDENTS:\n<\/p>\n<p>\u00a0<\/p>\n<p>Name of individuals<\/p>\n<p>Number of shares<\/p>\n<p>(a)<\/p>\n<p>Shri R.C.Oswal<\/p>\n<p><span class=\"hidden_text\">1<\/span><\/p>\n<p>(b)<\/p>\n<p>M\/s. R.C.Oswal &amp;<br \/>\nSons<\/p>\n<p>65,500.\n<\/p>\n<p>(c)<\/p>\n<p>Shri S.P.bswal<\/p>\n<p>95,450<\/p>\n<p>\u00a0<\/p>\n<p>(d)<\/p>\n<p>Smt . Banarso Devi will<br \/>\na\/c (Registered the name of Shri Asho Oswal<br \/>\n)<\/p>\n<p><span class=\"hidden_text\">450<\/span><\/p>\n<p>\u00a0<\/p>\n<p>Total<\/p>\n<p>1,61,401<\/p>\n<p>IB.NAME OF INVESTMENT COS. WHICH<br \/>\n\u00a0<\/p>\n<p>HOLD SHARES IN SHREYANS<br \/>\nAND WHERE SHARES ALONE WILL BE TRANSFERRED<\/p>\n<p> (a) <\/p>\n<p> Metro Investment &amp; Marketing Co.<br \/>\nPvt.Ltd.\n<\/p>\n<p> 14,000 <\/p>\n<p> (b) <\/p>\n<p> Eastern Investment &amp; Marketing Co. Pvt. Ltd.\n<\/p>\n<p> 13,900 <\/p>\n<p> (c) <\/p>\n<p> Sanmati Investment &amp; Trading<br \/>\nCo.Pvt. Ltd.\n<\/p>\n<p> 15,500 <\/p>\n<p> (d) <\/p>\n<p> Nahar Investors &amp; Traders Pvt. Ltd.\n<\/p>\n<p> 10,100 <\/p>\n<p> \u00a0<\/p>\n<p> Total <\/p>\n<p> 53,550 <\/p>\n<p>II.\n<\/p>\n<p>ADINATH TEXTILES LTD <\/p>\n<p>IIA. Direct holding of Respondents <\/p>\n<p> Name of the individual <\/p>\n<p> No. of Shares <\/p>\n<p> (a)\u00a0<\/p>\n<p> Shri S.P.\n<\/p>\n<p>Oswal <\/p>\n<p>\u00a0\u00a0<br \/>\n<span class=\"hidden_text\">800 <\/span><\/p>\n<p> (b)\u00a0<\/p>\n<p> M\/s. S.P.\n<\/p>\n<p>Oswal &amp; Sons <\/p>\n<p>\u00a0\u00a0<br \/>\n<span class=\"hidden_text\">700 <\/span><\/p>\n<p> (c)\u00a0<\/p>\n<p> Mrs. Shakun<br \/>\nOswal <\/p>\n<p>\u00a0\u00a0<br \/>\n<span class=\"hidden_text\">200 <\/span><\/p>\n<p> (d)\u00a0<\/p>\n<p> Shri R.C.\n<\/p>\n<p>Oswal <\/p>\n<p>\u00a0\u00a0\u00a0<br \/>\n<span class=\"hidden_text\">70 <\/span><\/p>\n<p> (e)\u00a0<\/p>\n<p> M\/s. R.C.\n<\/p>\n<p>Oswal &amp; Sons <\/p>\n<p>\u00a0\u00a0<br \/>\n<span class=\"hidden_text\">500 <\/span><\/p>\n<p> (f)\u00a0<\/p>\n<p> Mr. Ashok<br \/>\nOswal <\/p>\n<p>\u00a0\u00a0<br \/>\n<span class=\"hidden_text\">320 <\/span><\/p>\n<p> (g)\u00a0<\/p>\n<p> M\/s. Ashok<br \/>\nKumar &amp; Sons <\/p>\n<p>14,600<\/p>\n<p> (h)\u00a0<\/p>\n<p> Mrs. Manju<br \/>\nOswal <\/p>\n<p>\u00a0<br \/>\n4,500 <\/p>\n<p>&#8220;II.B.\n<\/p>\n<p>NAME OF THE INVESTMENT COS.WHICH HOLD SHARES IN ADHINATH AND WHERE SHARES<br \/>\nALONE WILL BE TRANSFERRED <\/p>\n<p> Name of Investment Company\u00a0<\/p>\n<p> No.of shares\u00a0<\/p>\n<p>(a)<\/p>\n<p>Amber<br \/>\nInvestment &amp; Mercantile Co.\n<\/p>\n<p>\u00a0\u00a0<br \/>\n<span class=\"hidden_text\">400 <\/span><\/p>\n<p>(b) <\/p>\n<p>Paras Finance &amp; Trading Co.\n<\/p>\n<p>\u00a0\u00a0\u00a0 50 <\/p>\n<p>(c)<\/p>\n<p>Victor<br \/>\nInvestment &amp; Mercantile Co.\n<\/p>\n<p>1,030<\/p>\n<p>(d)<\/p>\n<p>Arihant<br \/>\nInvestment &amp; Trading Co.\n<\/p>\n<p>\u00a0\u00a0\u00a0<br \/>\n<span class=\"hidden_text\">75 <\/span><\/p>\n<p>(e)<\/p>\n<p>Akshay<br \/>\nFinance &amp; Trading Co.\n<\/p>\n<p>\u00a0<br \/>\n<span class=\"hidden_text\">200 <\/span><\/p>\n<p>(f) <\/p>\n<p>Adinath Investment &amp; Trading Co.\n<\/p>\n<p>\u00a0 500 <\/p>\n<p>(g)<\/p>\n<p>Devakar<br \/>\nInvestment &amp; Trading Co.Pvt. Ltd.\n<\/p>\n<p>\u00a0<br \/>\n<span class=\"hidden_text\">330 <\/span><\/p>\n<p>(h)<\/p>\n<p>Nahar<br \/>\nInvestors &amp; Traders Pvt. Ltd.\n<\/p>\n<p>\u00a0\u00a0\u00a0<br \/>\n<span class=\"hidden_text\">50 <\/span><\/p>\n<p>\u00a0<\/p>\n<p>Total<\/p>\n<p>3,065<\/p>\n<p>II.C NAMES OF THREE PUBLIC LIMITED COS. WHICH HOLD SHARES IN ADHINATH AND WHERE SHARES ALONE WILL BE<br \/>\nTRANSFERRED<\/p>\n<p>  Name of the Company <\/p>\n<p>  No. of shares<\/p>\n<p>  a)<br \/>\n  Santon Finance &amp; Investment Co. Ltd.<br \/>\n  19,995<\/p>\n<p>  b)<br \/>\n  Flamingo Finance &amp; Investment Co. Ltd.<br \/>\n  30,000<\/p>\n<p>  c)<br \/>\n  Ramaniya Finance &amp;Investment Co. Ltd.<br \/>\n  50,000<\/p>\n<p>  Total<br \/>\n  99,995<\/p>\n<p>IID NAMES OF THE FIRMS WHICH HOLD SHARES IN ADHINATH AND WHERE SHARES ALONE WILL BE TRANSFERRED<\/p>\n<p>  Name of the Firm<\/p>\n<p>  No. of shares<br \/>\n  Registered in the name of<\/p>\n<p>  (a)<br \/>\n  Amber Syndicate<br \/>\n  25,350<br \/>\n  Sh.D.K.Oswal 25000<\/p>\n<p>  Sh.R.C.Oswal 350<\/p>\n<p>  (b)<br \/>\n  Paras Syndicate<br \/>\n  30,000<br \/>\n  Shri D.K.Oswal<\/p>\n<p>  (c)<br \/>\n  Adhinath<\/p>\n<p>  Syndicate<br \/>\n  30,000<br \/>\n  Shri S.P. Oswal<\/p>\n<p>  85,350<\/p>\n<p>III NAMES OF THE INVESTMENT COS. WHICH HOLD SHARES IN SHREYANS AND ADHINATH AND THE CONTROL OF THE SAME WILL BE HANDED OVER TO SHRI D.K. OSWAL&#8217;S GROUP.\n<\/p>\n<p>  Name of the Company<\/p>\n<p>  No. of shares<\/p>\n<p>  Adhinath<br \/>\n  Shreyans<\/p>\n<p>  (a)<br \/>\n  Achin Investment &amp; Mercantile Co.<br \/>\n  55,500<br \/>\n  55,500<\/p>\n<p>  (b)<br \/>\n  Levina Investment &amp; Mercantile Co.<br \/>\n  76,600<br \/>\n  78,900<\/p>\n<p>  (c)<br \/>\n  Ojasvi Investment &amp; Mercantile Co.<br \/>\n  40,500<br \/>\n  95,000<\/p>\n<p>  (d)<br \/>\n  Adeep Investment Co<br \/>\n  17,900<br \/>\n  30,000<\/p>\n<p>  (e)<br \/>\n  Virat Investment &amp; Mercantile Co.<br \/>\n  36,100<br \/>\n  30,000<\/p>\n<p>  Total<br \/>\n  2,26,600<br \/>\n  2,88,900<\/p>\n<p> In order to give effect to the aforesaid<br \/>\ntransfer, the following directions are<br \/>\nissued:\n<\/p>\n<p> i) Within two weeks from today all the<br \/>\nparties will deposit with the Registrar<br \/>\nof this Court, duly executed, share<br \/>\ntransfer deeds along with share scrips in<br \/>\nthe manner indicated above.\n<\/p>\n<p> ii) The Registrar shall deliver the blank<br \/>\nshare transfer deeds duly signed as well<br \/>\nas share scripts of Shreyans and Adhinath<br \/>\nto Shri D.K. Oswal or his nominee and of<br \/>\nVardhman and Mahavir to Shri R.C. Oswal<br \/>\nor his nominee.\n<\/p>\n<p> iii) With the lodging and handing over of the<br \/>\ntransfer deeds, the respondents will,<br \/>\nwithin one week thereof, ensure the<br \/>\nregistration of the transfer of shares of<br \/>\nShreyana and Adinath in favor of Shri<br \/>\nD.K. Oswal and his nominees and will<br \/>\nensure that the Board of Directors of<br \/>\nShreyans and Adhinath co-opt Shri D.K.<br \/>\nOswal and his nominees as Directors of<br \/>\nShreyans and Adinath and thereupon Shri<br \/>\nS.P. Oswal, R.C. 1 Oswal and Ashok Oswal<br \/>\nshall resign from the Board of Directors<br \/>\nof Shreyans and Adinath.\n<\/p>\n<p> iv) Shri S.P. Oswal and Shri R.C. Oswal are<br \/>\nfurther directed to give effect to the<br \/>\nresolution dated 26th February, 1981<br \/>\npassed by Vardhman regarding the<br \/>\ncompliance of condition No. J. attached<br \/>\nto the letter dated 12th November, 1981<br \/>\nissued by the Controller of Capital<br \/>\nIssues, Government of India to Shreyans<br \/>\nPaper Mills Limited and to sell shares of<br \/>\nShreyans held by Vardhman in excess of<br \/>\n40% held by the promoters at the market<br \/>\nvalue of the shares. It is further<br \/>\ndirected that these shares will first be<br \/>\noffered for sale of Shri D.K. Oswal and<br \/>\nhis Group and in order to make up the<br \/>\ndifference Shri R.C. Oswal and members<br \/>\nof his Group are further directed to give<br \/>\nto Shri D.K. Oswal and his Group<br \/>\nRs. 21,75,586\/- which would enable him to<br \/>\npurchase the said shares of Shreyans to<br \/>\nbe sold by Vardhman.\n<\/p>\n<p> v) Both the Groups will file appropriate<br \/>\napplications with the financial<br \/>\ninstitutions and see the release of<br \/>\npersonal guarantees of the petitioner and<br \/>\nmembers of his group which may have been<br \/>\ngiven for financial arrangement extended<br \/>\nby the institutions to Vardhman and<br \/>\nMahavir and also the release of<br \/>\nguarantees of R.C. Oswal and members of<br \/>\nhis group which may similarly have been<br \/>\ngiven to the financial institutions or<br \/>\nother institutions for extending the<br \/>\nfinancial assistance to Shreyans and<br \/>\nAdinath.\n<\/p>\n<p> vi) Both the groups are directed to take all<br \/>\nsteps which may be necessary to give<br \/>\neffect to the transfer of shares and<br \/>\nmanagement of Shreyans and Adinath to<br \/>\nD.K. Oswal and his Group and the transfer<br \/>\nof shares of Vardhman and Mahavir by D.K.<br \/>\nOswal and members of his group in favor<br \/>\nof R.C. Oswal and his group.\n<\/p>\n<p> vii) Parties are at liberty to apply to this<br \/>\nCourt, from time to time if the need<br \/>\narises, for directions or clarifications<br \/>\nwhich may be necessary in order to give<br \/>\neffect to the settlement of dispute<br \/>\nbetween the parties.\n<\/p>\n<p> The Company Petitions are disposed of in<br \/>\nthe aforesaid terms. The parties shall bear<br \/>\ntheir own costs.&#8221;\n<\/p>\n<p> 9. Although the lis had been disposed of by the<br \/>\nafore-mentioned orders, since some delay or difficulty<br \/>\nwas encountered in its implementation, applications<br \/>\nwere subsequently filed and entertained by the Court.<br \/>\nHowever, even on a perusal of the Orders dated<br \/>\n25.9.1987 in terms of which CA 643\/1987 had been<br \/>\ndisposed of, it will be evident that the severance<br \/>\nwhich took place in CP 21\/1986 was the separation of<br \/>\nthe share of Shri D.K. Oswal only. What was clarified<br \/>\nby the Court was merely that each person had an equal<br \/>\nshares i.e. one quarter each. This is also manifested<br \/>\nfrom the fact that from 1987 onwards, till the death of<br \/>\nthe patriarch Late Shri R.C. Oswal, the business<br \/>\nventures of the respondent group which included the two<br \/>\nbrothers who are now adversaries in these applications<br \/>\nwere jointly carried out by all three of them. The<br \/>\ncontention of Mr. Bhushan that the Oswal Family<br \/>\nbusinesses were, in fact, partitioned in 1\/4th share<br \/>\neach is accordingly rejected. Once this conclusion is<br \/>\nreached, it will not be possible to view the present<br \/>\napplications as having the character and merely<br \/>\nendeavoring to implement the earlier orders and<br \/>\neffecting a distribution of assets by metes and bounds,<br \/>\nso as to bring them within the parameters set down in<br \/>\npara (vii) of the above extracted orders.\n<\/p>\n<p> 10. What must be decided is whether this Court<br \/>\npossesses the requisite jurisdiction to entertain<br \/>\napplications which, in essence, seek to carry out<br \/>\nrectifications in the Register of Members of Companies<br \/>\nwithin the management of the further fragmented Oswal<br \/>\nGroup subsequent to eh death of Late R.C. Oswal. At<br \/>\nthe time when CP 21\/1986 had been filed Section 155 of<br \/>\nthe Companies Act vested the power to rectify the<br \/>\nRegister of Members in the Company Judge. This<br \/>\nprovision, however, has been repealed by the Companies<br \/>\n(Amendment) Act, 1988, with effect from 31.5.1991 and<br \/>\nits provisions have been assimilated in the amended<br \/>\nSection 111 with the consequence that the avenue of<br \/>\nrelief now leads to the Company Law Board. Where a<br \/>\ntotally new case is being put forward, the Court must<br \/>\nnot revive a Petition which has already been disposed<br \/>\nof and thereby assume a jurisdiction which it to longer<br \/>\npossesses. No doubt, applications have been<br \/>\nentertained in this Petition till quite recently, but<br \/>\nthe distinction which must be honoured is that the<br \/>\nCourt may retain the power to pass orders which are<br \/>\ncalculated to implement the orders previously passed by<br \/>\nit when it possess jurisdiction over the lis. The<br \/>\npresent dispute, as has already been stated is<br \/>\nessentially different to the factual matrix and the<br \/>\nprayers contained in CP 21\/1986, and for that matter in<br \/>\nall the other CPs 21\/1986 to 26\/1986. Mr. Bhushan has<br \/>\nhimself adverted to the Will of Late R.C. Oswal, which<br \/>\nhas become operative several years after the disposal<br \/>\nof CP 21\/1986. The genesis of the present disputes can<br \/>\nbe traced back to the allotment of 10,000 shares in<br \/>\n1998, and the resultant alteration of the control of<br \/>\nVardhman Polytex. Mr. Bhushan has also mentioned<br \/>\nchanges in the Board of Directors of that Company and<br \/>\nMahavir Spinning and General Mills which occurred in<br \/>\nAugust 2000. Quite obviously, this has no bearing on<br \/>\nthe facts which existed in 1986. The heading of the<br \/>\napplications mention that they re pursuant to the<br \/>\ndemise of Shri R.C. Oswal.\n<\/p>\n<p> 11. Before departing from this aspect of the<br \/>\ncase it is of extreme relevance that the Registered<br \/>\nOffice of the companies which were within the purview<br \/>\nof the six petitions which had received the attention<br \/>\nof this Court, were all at the same address, i.e. 205,<br \/>\nSurya Kiran Building, Barakhamba Road, New Delhi. At<br \/>\nthe present moment the Registered Offices have been<br \/>\nshifted out of Delhi to Ludhiana (Punjab) after<br \/>\nobtaining the approval of the Company Law Board.\n<\/p>\n<p> 12. Section 10 of the Companies Act stipulates<br \/>\nthat the Court having jurisdiction shall be the High<br \/>\nCourt having jurisdiction in addition to the place at<br \/>\nwhich the registered office of the company is situate.<br \/>\nSub-section (3) of Section 10 is not relevant inasmuch<br \/>\nas it refers to winding-up petitions. However, it is<br \/>\ninteresting to note that even in the context of the<br \/>\nperiod of six months, it has been clarified that the<br \/>\nlocation of only that registered office will be taken<br \/>\ninto consideration which has existed in the longest<br \/>\nportion of the six months immediately preceding the<br \/>\npresentation of such a petition. The effort in these<br \/>\napplications is to resurrect a petition filed almost<br \/>\nover fifteen years ago, despite the fact that the<br \/>\nregistered offices are located in Ludhiana since last<br \/>\nfour years.\n<\/p>\n<p> 13. This is also how the applicants had<br \/>\nthemselves viewed the legal position. A Scheme of<br \/>\namalgamation under Section 394 of the Companies Act was<br \/>\nmoved by the parties hereby not in this High Court but<br \/>\nin the High Court of Punjab and Haryana at Chandigarh.<br \/>\nThe Scheme was approved by that Court on August 1,<br \/>\n2000. Thereafter, C.P. No. 49\/2001 was filed by the<br \/>\nApplicant himself before the Company Law Board,<br \/>\nPrincipal Branch, New Delhi as recently as 25th<br \/>\nFebruary, 2002. The Company Law Board had passed an<br \/>\norder in respect of M\/s. Panchasheel Textile<br \/>\nManufacturing and Trading Co. (Pvt.) Ltd., at the<br \/>\ninstance of the applicant and directed that the<br \/>\nprevailing position int he said company will continue<br \/>\ntill such time the obligations resting on the<br \/>\nPetitioner are discharged. An Appeal from this order<br \/>\nis pending in the High Court of Punjab and Haryana at<br \/>\nChandigarh. It has been ordered that status quo as it<br \/>\nexisted on 24.4.2002 shall be maintained.\n<\/p>\n<p> 14. As I see it the present applications have<br \/>\nbeen field in 2002, in an attempt to open up another<br \/>\nfrontier in the family dispute between the two<br \/>\nbrothers. This Court no longer possesses any<br \/>\njurisdiction over these disputes.\n<\/p>\n<p> 15. CA 639\/2002 and CA 640\/2002 are,<br \/>\naccordingly rejected. CA 707\/2002 is allowed. Interim<br \/>\nOrders dated 31.5.2002 are recalled.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Delhi High Court D.K. Oswal And Ors. vs Mr. Akshay Finance And Ors. on 9 August, 2002 Equivalent citations: 2003 115 CompCas 577 Delhi, 2004 50 SCL 303 Delhi Author: V Sen Bench: V Sen JUDGMENT Vikramajit Sen, J. CA 641\/2002 &amp; 642\/2002 1. Allowed, subject to all just exceptions. CA 685 &amp; 686\/2002 in [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[14,8],"tags":[],"class_list":["post-140652","post","type-post","status-publish","format-standard","hentry","category-delhi-high-court","category-high-court"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>D.K. 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