{"id":63439,"date":"2010-12-08T00:00:00","date_gmt":"2010-12-07T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/light-house-marketing-pvt-ltd-vs-gerb-vibration-control-systems-on-8-december-2010"},"modified":"2016-09-07T12:20:50","modified_gmt":"2016-09-07T06:50:50","slug":"light-house-marketing-pvt-ltd-vs-gerb-vibration-control-systems-on-8-december-2010","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/light-house-marketing-pvt-ltd-vs-gerb-vibration-control-systems-on-8-december-2010","title":{"rendered":"Light House Marketing Pvt Ltd vs Gerb Vibration Control Systems &#8230; on 8 December, 2010"},"content":{"rendered":"<div class=\"docsource_main\">Karnataka High Court<\/div>\n<div class=\"doc_title\">Light House Marketing Pvt Ltd vs Gerb Vibration Control Systems &#8230; on 8 December, 2010<\/div>\n<div class=\"doc_author\">Author: H.G.Ramesh<\/div>\n<pre>M.F.A.NO.9388\/2010\n\nIN THE HIGH COURT OF KARNATAKA AT BANGALORE\n\nDATED THIS THE 8TH DAY OF DECEMBER 2010  .. \n\nBEFORE\n\nTHE I-ION'BLE MRJUSTICE H.G.RAMESI-.1\" ' \n\nMisceilaneous First Amoeal   \n\nBETWEEN:\n\nLIGHT HOUSE MARKETING PVT. LTD \n\nA COMPANY INCORPORATED UNDER   _\u00bb\nTHE PROVISIONS OF THE COMPANIES\" ACT, ' I 956\nAND HAVING ITS OFFICE AT 3-~,I._;I;2 ; -- \"  \nALI ASKER ROAD , \"  2 \nJAYASHREE POINT 2-A, BANGALORE  I\nREGISTERED OFFICE._AT__7 * \" *  ' I. \nCHITTARANJAN AVEN  *\n\n3RD FLOOR, LAHATA PAINT; HO\nKOLKATA 700 0*=i72.   &gt;   j\nREP. BY ITS AUTiiOR.I$ED SICiNAT_ORY'\"\nMR.AS\u00a5\ufb01NIN\"SA1\\ICH.ETI'*i::,  * A \nS\/OMSANCHETI\"a*,  _ \nAGED 34 YEARS', R\/AI'fR.o.9,V&amp;'IIIDQ .. '\nCHOUDAPPAROAD. S2\u00bb1AI$ITINAGAR,.~\nNEAR NIRMALGIRLS HIGH SCHOOL\nBANGALORE 56'G,02~7V  ' \n\n  \n\n... APPELLANT\n\n~ A. &amp;_ [BY SR; UDAY HOLLA, S_R_.ADVOCATE FOR\n\n A IVE-\/S CRESTLAW PARTNERS, ADVOCATES)\n\n1  VIBRATION CONTROL SYSTEMS PRIVATE LIMITED\nA 'COMPA:~IVI.'INCORPORATED UNDER\n. THE PROVISIONS OF THE COMPANIES ACT, 1956\n AND IIAVING ITS OFFICE AT PLOT NO.27A,\n I EAR PHASE, PEENYA INDUSTRIAL AREA\n. I3AN'GALORE 560 058\n REEF-{BY ITS MANAGING DIRECTOR\n\n V   GESSELSCHARFT FUR ISOLIERUNG\n\nA COMPANY INCORPORATED\nUNDER THE LAWS OF THE\n\n\n\nM.F.A.NO.9388\/2010\n\nFEDERAL REPUBLIC OF GERMANY\n\nAND HAVING ITS REGISTERED OFFICE AT\nROEDERNALLEE 174- 176,\n\nD-- 13407 BERLIN, GERMANY\n\nREP. BY ITS MANAGING DIRECTOR  RESpONDE\u00a7\u00a7;TS'    ..\n\n[BY SR1 S.S.NAGANANDA, SRCOUNSEL FOR\nSMT SUNITHA AN D SURE, ADVOCATES)\n\nTHIS MFA IS FILED U\/S 37{1}{a] OE AI:iIsITI&gt;,ATIOI\\I_\" 'AIfjID\"\"\n\nCONCILIATION ACT AGAINST THE ORDER DAFED'30;~1_O.201.0-..p fr'\nPASSED IN A.A.NO.25076\/2010 ON THE FILE GE IV ADI;_\\1TIOI*JAL. '\nCITY CIVIL as: SESSIONS JUDGE, BANGALORE-,._ D}SMISSINC~__THE\u00a7\n\nPETITION FILED U \/S 9 OF ARBITRATIO_N\"AND CONCILIATION AC'I'\nF'ORT.1.  '   \n\nTHIS MFA COMING oI\u00a7I\"EoR  VDAYVV, THE\nCOURT DELIVERED THE FOLLOWING-; 1, ;   '0 .\n\nI \nThis appeal  'VV3'7V{$1)[a) of the\nArbitration .1996 ('the Act') is\ndirected against'the..:e1~cI'ei\u00a7_i':dated 30.10.2010 passed by\n\nthe Court of\"the IVVVA;iditi'On'-aibity Civil Judge, Mayo Hall\n\n.-g1Init,p.\u00bbEiyanga1ore By the impugned order, the\n\n 'I:,~.e1O_w.L\"'I*I..3f.S dismissed Arbitration Application\n\nN0;9,x\u00a7$07f3'\/i\u00a7A.Gp--1Gii;.'Tiled by the appellant herein under\n\n'VSeCtionz9\"V.Of\"i:he Act for grant of an Order of temporary\n\n :irIin:1c_tiOn to restrain the respondents herein from taking<\/pre>\n<p> Steps to enter into any agreement to purchase \/ invest<\/p>\n<p>&#8220;&#8221;.:in&#8221;the Schedule property or any portion thereof or any<\/p>\n<p>M.F&#8217;.A.i\\io.9388\/2010<\/p>\n<p>other immovable property till the resolution of the<\/p>\n<p>dispute between the parties through arbitration.<\/p>\n<p>2. i have heard Sri Udaya Holla,  C&#8221;<\/p>\n<p>Counsel appearing for the   appeilant&#8217; 1:  .   <\/p>\n<p>Sri.S.S.Naganand, learned Senior Couns_e1A~<\/p>\n<p>the respondents and perused\n<\/p>\n<p>3. Material facts relevant    appeal<br \/>\nare as follows:  C it it<br \/>\nRespondentN:o;.__l &#8211;  Systems<br \/>\nPrivate Ltd.  is&#8221;    under the<br \/>\nprovisions of  1956 having only two<\/p>\n<p>share holders iinariiellyip theprappellant and respondent<\/p>\n<p>_No.2; pp iaappellanptlvlholids 40% and respondent No.2<\/p>\n<p> the share capital of the Company.<\/p>\n<p> Company in its Board meeting held<\/p>\n<p>it .011 06&#8243;;&#8217;09.\u00a32:O  has resolved to purchase the schedule<\/p>\n<p> (hilly described in the application filed before<\/p>\n<p>the._llCo&#8217;L:irt below} approximately measuring 1.8 acres<\/p>\n<p>it ibeloriging to a company by name Everest Industries Ltd.<\/p>\n<p>f\/..\n<\/p>\n<p>M.F.A.N0.9388\/2010<\/p>\n<p>The case of the appellant is that it opposed the aforesaid<\/p>\n<p>resolution and as the Articles of Association.,:of&#8217;ll~.._<\/p>\n<p>respondent No.1 &#8212; Company requires its con&#8217;sent&#8221;&#8216;=fojr. -1- <\/p>\n<p>purchase of such a property, the decision is&#8221;&#8216;u&#8217;1~t&#8211;1{a. pviresip <\/p>\n<p>the Articles of Association of the Corrirpariyefi&#8221; <\/p>\n<p>accordingly sought for the interirnnieasure referredvtonat<br \/>\npara 1 above. As the same was&#8221;-refuxsedlhhyl_:theVf%Civ&#8217;il<\/p>\n<p>Court, the appellant is in &#8216;a1$p_\u00ab:a1_ pbefore&#8217;~.thisiCourt.<\/p>\n<p>4. Sri Udaya\u00a7~H&#8217;:ilVla&#8211;,  appearing<br \/>\nfor the   the Joint Venture<br \/>\nAgreement&#8217; &#8216;dated _v ;   submitted that<br \/>\nthe agreern.ent  Articles of Association of<\/p>\n<p>respondent  ~~&lt;_C;&#039;.on:pa1illy) entered into between the<\/p>\n<p>&#039; l&#039;appel1a&#039;nt:&#039;_s,predecessorin interest and respondent No.2,<\/p>\n<p>si_;b&#039;rn_it&#039;tedv\u00ab._.th&#039;at_A the decision of respondent No.1 -~\u00bb<\/p>\n<p>Cornpany vtopjurchase the schedule property is contrary<\/p>\n<p> to Clause 8.6 of the said agreement which contemplates<\/p>\n<p>it  l&#039;unanirij&#039;.ous consent of its shareholders as the scheduie<\/p>\n<p> -.._l:;pro\u00a73erty is &#8216;a part of the undertaking&#8217; of Everest<\/p>\n<p> ~ ifhidustries Ltd. He further submitted that the appellant<\/p>\n<p>M.F&#8217;.A.N0.9388\/2010<\/p>\n<p>did not consent for purchase of the schedule property in<\/p>\n<p>the Board meeting held on 6.9.2010. He submitted <\/p>\n<p>as the schedule property is &#8216;a part of the underta.k_ihg*5 .1. C <\/p>\n<p>Everest Industries Ltd., clause 8.(3mMof <\/p>\n<p>agreement gets attracted and accordirigly;   C<\/p>\n<p>ought to have granted the interim meets\ufb01re<br \/>\nunder Section 9 of the Act.\n<\/p>\n<p>5. On the contrary, Sril  Senior<\/p>\n<p>Counsel appearing\u00ab\u00ab#fr&#8217;3r the  that<br \/>\nthe schedule.&#8217;    undertaking&#8217; nor<br \/>\nforms &#8216;as Everest Industries<br \/>\nLtd. and vVtl&lt;1er\u00abeforel,ly  by the Court below is<\/p>\n<p>correct- _He subrrlittedAthatfthe schedule property is only<\/p>\n<p> stand, Helllfurfiier submitted that the case of the<\/p>\n<p> &quot;the Court below is that the schedule<\/p>\n<p><span class=\"hidden_text\">6<\/span><\/p>\n<p>property  come within the ambit of an<\/p>\n<p>  &#8216;u.ndertdkirr\u00a7g&#8217;; it was not the case of the appellant that the<\/p>\n<p>it   property would come within the ambit of &#8216;a part<\/p>\n<p>   Qfthe undertaking&#8217; as now urged before this Court.<\/p>\n<p> l<br \/>\n\/<\/p>\n<p>M.F&#8217;.A.No.9388\/2010<\/p>\n<p>6. In View of the above. the only question that falls for<\/p>\n<p>determination in this appeal is as to whether the dec4Eei_o\u00a31it&#8217;~..<\/p>\n<p>of respondent No.1 &#8211; Company to purchase  &#8216;7&#8217; <\/p>\n<p>property is prima facie contrary toQlause'&#8221;8&#8242;.{3~::&#8217;of&#8217;V&#8221;tt;e.V <\/p>\n<p>aforesaid joint venture agreement or &#8216;rlot? It iS&#8221;1&#8217;T_Et1&#8217;Et\\f\u20acU.1&#8217;Vt  :3 &#8216;<\/p>\n<p>refer to Clause 8.6 of the Joint&#8217;tV_Ve1;.1tur2e&#8217;Ag1&#8217;eenierit._&#8217;d.ated<br \/>\n30.7.1990 which reads as fo11ows___:_i: e<\/p>\n<p>&#8220;8.6 &#8211;\u00ab Certain matters&#8217;-_io%.j_ybe&#8217;4 by<\/p>\n<p>Special Reso1utions__ H   V<\/p>\n<p>The parties    GERB<br \/>\nandiaj    tithe prior<br \/>\nunahiiinoius  of  ehareholders<br \/>\naccorded &#8211;resolution passed at<br \/>\na C&#8217;\u00a7ener*al&#8217;f\u00bb:Fe\u00e9iir;_gr:&#8221;Q,f&#8221; [INDIA] do or<br \/>\nundertake =a&#8217;ny.&#8221;-  the following in<br \/>\n &#8216;accordance with&#8212;Aiis Share Capital :<\/p>\n<p>, ., ., _c1}.._Increase in Share Capital.<\/p>\n<p> of Memorandum and\/ or<br \/>\nArticles of Association.\n<\/p>\n<p>c) v.1t\u00a71I&#8217;erger or Amalgamation with any other<br \/>\nCompany or body corporate.\n<\/p>\n<p>&#8216;  Acquisition of direct or indirect. control<br \/>\nand\/ or takeover of any other company<\/p>\n<p>or body corporate or whole or any part<\/p>\n<p>\/<\/p>\n<p>M.F.A.No.9388\/2010<\/p>\n<p>of business operations or undertaking<\/p>\n<p>of any other company, body corporate<\/p>\n<p>or persons including acquisition of  <\/p>\n<p>control by way of investment control of _<br \/>\ncomposition of the Board andmthe like;   V <\/p>\n<p>e) Enter into technical collaboration&#8217; anctl\/ior  &#8216;-<br \/>\nJoint Venture with third paratt-esL&#8212;-_lt A&#8217; it it it<\/p>\n<p>\ufb02 Establishment, &#8216;foirnation  ._<br \/>\nincorporation of any Company or&#8221;  V<br \/>\ncorporate.     _ <\/p>\n<p>g) In the event of l&#8217; the<br \/>\nCompany&#8217;,   l<br \/>\n(Indial   to  V&#8217; &#8216;Therefore,<br \/>\n  \u00a2jjGERB (India)<\/p>\n<p> lslhaiiinot tie; &#8216;ussed.;by either party. &#8221;<\/p>\n<p>l V . supplied)<\/p>\n<p>As could L be hlseerxtvfroin &#8216;the above clause, it is not<\/p>\n<p>  for respondent No.1 &#8212; Company to acquire<\/p>\n<p> or business operations or undertaking of<\/p>\n<p>V &#8221; any other.c~o_rnpany without the prior unanimous consent<\/p>\n<p>1&#8217;<\/p>\n<p> its shareholders accorded by a special resolution<\/p>\n<p>  at a general meeting of the Company. In my<\/p>\n<p>h   opntiion, the question as to whether the schedule property<\/p>\n<p>this &#8216;an undertaking&#8217; or forms &#8216;a part of the undertaking&#8217; of<\/p>\n<p>3A&#8217;\/<\/p>\n<p><span class=\"hidden_text\">M.F.A.No.9388\/20 10<\/span><\/p>\n<p>the Company namely, Everest industries Ltd. and<\/p>\n<p>whether the decision to purchase the scheduie properiyVrisr&#8221;._V&#8217;<\/p>\n<p>contrary to clause 8.6 of the agreement referred   :_. C <\/p>\n<p>requires consideration. Having regard to 1._:l&#8217;1&#8217;e~p:e.culiar<\/p>\n<p>facts of the case, i deem it appropriate  C<\/p>\n<p>interest of both the parties pencling adjudicat~ion.Vp:.of<br \/>\ndispute that has arisen  -the&#8221;  and<br \/>\naccordingly make the folloiiringli H<br \/>\nRespondent No&#8221;. 1 &#8212;-i   Systems<br \/>\nPrivate Limit_ed\u00a7&#8217;&#8211;i. the schedule<br \/>\nproperty   the dispute, if it is<br \/>\nheld by &#8216;Triblulrial &#8211; that the purchase of the<\/p>\n<p>schedule  No.1 &#8212; Company is<\/p>\n<p> contrary to Cla&#8217;us_e: 8.6: of the joint venture agreement<\/p>\n<p>Alnreferrjed _to,above, respondent No.1 &#8212; Company shall sell<\/p>\n<p> in public auction and if any loss is<\/p>\n<p>&#8211;incur&#8221;red&#8221;&#8212;V: torespondent No.1 &#8212; Company by this<\/p>\n<p> lllvptransaction of purchase and sale, it shall be made good<\/p>\n<p>&#8212;  respondent No.2 &#8211; Company.\n<\/p>\n<p>M.F.A.N0.9388\/2010<\/p>\n<p>At this stage, learned Senior Counsel appearing on<\/p>\n<p>both sides submit that both the parties would submit<\/p>\n<p>arbitration for resolution of the dispute referred    <\/p>\n<p>and that the parties would fully (:0HfVQI3era.t\u20ac&#8221;&#8221;&#8221;:T&#8217;i:tEl: <\/p>\n<p>Arbitrator for disposal of the arbitratioii   .l<\/p>\n<p>expeditiously and in any eventlwi.thinllli&#8217;oui&#8217;<br \/>\ntoday. Their submission is  &#8211;recolr&lt;&quot;:i..w:fl\ufb01beylfiseek<br \/>\nleave to move this Court&#8211;&#8230;.tor_   the<br \/>\nevent of the arbitrai  concluded<br \/>\nwithin the said\u00bb    granted.\n<\/p>\n<p> the above terms<br \/>\nin modifieation of herein.\n<\/p>\n<p>\nSd\/&#8217;~<br \/>\nJUDGE<\/p>\n<p>V -Vhkh\/llata  l<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Karnataka High Court Light House Marketing Pvt Ltd vs Gerb Vibration Control Systems &#8230; on 8 December, 2010 Author: H.G.Ramesh M.F.A.NO.9388\/2010 IN THE HIGH COURT OF KARNATAKA AT BANGALORE DATED THIS THE 8TH DAY OF DECEMBER 2010 .. BEFORE THE I-ION&#8217;BLE MRJUSTICE H.G.RAMESI-.1&#8243; &#8216; Misceilaneous First Amoeal BETWEEN: LIGHT HOUSE MARKETING PVT. LTD A COMPANY [&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":[8,20],"tags":[],"class_list":["post-63439","post","type-post","status-publish","format-standard","hentry","category-high-court","category-karnataka-high-court"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.0 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Light House Marketing Pvt Ltd vs Gerb Vibration Control Systems ... on 8 December, 2010 - Free Judgements of Supreme Court &amp; High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/light-house-marketing-pvt-ltd-vs-gerb-vibration-control-systems-on-8-december-2010\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Light House Marketing Pvt Ltd vs Gerb Vibration Control Systems ... on 8 December, 2010 - Free Judgements of Supreme Court &amp; 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