2006 (11) TMI 685 - Board - Companies Law

Summary

Issues involved: Matrimonial disputes, valuation of company shares, consent order validity, application for recall of consent order.

Matrimonial Disputes and Valuation of Company Shares:
The 1st petitioner, wife of the 2nd respondent, filed a petition u/s 397/398 of the Companies Act, 1956 regarding M/S Nikhil Rubber Private Ltd., where she held 90% shares and the 2nd respondent held 10%. The Board directed a fair valuation of the shares, which was contested by the 2nd respondent. Efforts to settle disputes globally failed, leading to a consent order on 2.6.2006 where the parties agreed on terms including division of assets and payment of &8377; 7.5 lakhs by the respondent. However, a subsequent application was filed by the 1st petitioner on 6.6.2006, challenging the consent order due to alleged mental depression during the agreement discussions.

Validity of Consent Order and Application for Recall:
The 1st petitioner contended that she was mentally depressed during the consent order discussions, leading to terms unfavorable to her. The respondent argued that the order was binding as it was signed by all parties and their counsel. The Chairman noted that the consent terms were voluntarily agreed upon by both parties after consulting their advocates, and any recall or modification required mutual consent. Citing legal precedents, the Chairman dismissed the application for recall, emphasizing that a consent order cannot be altered without agreement from all parties involved.

Extension of Time Schedule:
Due to the pending application challenging the consent order, the implementation of the agreed terms was delayed. The Chairman extended the time for handing over possession and payment to the petitioner to 28.2.2007 to allow for compliance with the consent order terms.

This summary provides a detailed overview of the legal judgment, highlighting the key issues, arguments presented, and the final decision rendered by the Chairman of the Company Law Board, New Delhi.