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TMI Blog2002 (8) TMI 773X X X X Extracts X X X X X X X X Extracts X X X X ..... ith rule 9 of the Companies (Courts) Rules, for the rectification of the register of members of the companies which were controlled by the Oswal family. These companies were Akshay Finance and Trading Company, Paras Finance and Trading Company, Arihant Investment and Trading Co., Victor Investment and Mercantile Co., Amber Investment and Mercantile Co. and Adinath Investment and Trading Company. At that point of time four public limited companies were also under the Oswal family s management, i.e., Vardhman Spinning and General Mills Ltd., Mahavir Spinning Mills Ltd., Shreyans Paper Mills Ltd. and Adinath Textiles Ltd. It is not in dispute that Vardhman Polytex was not in existence in 1987 and was, therefore, not within the purview of those company petitions. In those petitions the father of the petitioner, namely the late R.C. Oswal, and the petitioner s two brothers A.K. Oswal and S.P. Oswal were arrayed as respondents. They put up a common response/defence in all the petitions. 4. After one year of the pendency of those petitions, a settlement was brought about by Mr. Justice B.N. Kirpal (as the learned Chief Justice of India then was) in terms of his order dated August 12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons that the four branches of the family shall have 25 per cent interest each. On the contrary Mr. Chandiok has relied on paragraph 5 since it mentions that the interests of Shri D.K. Oswal were being separated from the rest of the family. "Present : Mr. Shanti Bhushan senior advocate with Mr. G.L. Rawal and Mr. K.M. Sharma, for the petitioner. Mr. Kapil Sibal, senior advocate with Mr. S.S. Shroff and Mr. Pinaki Misra, for the respondent. C.P. Nos. 21 to 26 of 1986 : It is indeed gratifying to note that the parties are agreed to the manner in which the disputes between them are to be settled. The agreement is that the share of each of the four branches involved in this case, namely, the petitioner, his father and his two brothers, should be deemed for working the settlement as being equal. The total value of the family s holdings in the various business concerns will be ascertained and thereafter the interest of the petitioner and his family members shall be separated. Payments made to any of the family members either from investment companies or trusts or otherwise for the alleged redemption/cancellation of shares shall be properly adjusted. The parties are agreed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e subject to such approvals or the financial institutions as may be required under the various agreements and undertakings to them. The deponent undertakes to take all necessary steps to obtain such approvals. In the meantime the suits, appeals and criminal complaints as are pending today will be stayed till further orders of the court. Affidavits in the aforesaid terms should be filed in court by all the members of Oswal family who have shares in their names directly or indirectly within ten days from today and the case be listed in chamber on May 16, 1986, at 4 p.m. May 6, 1986."(Sd.) B.N. Kirpal, Judge. 8. Even on a bare reading of the aforementioned order I am unable to subscribe to the view proposed by Mr. Bhushan that the court had divided and partitioned the shares of the late R.C. Oswal and each of his three sons in equal shares of 1/4th each. The division that was postulated even on May 6, 1986, was a severance of the 1/4th share of Shri D.K. Oswal from the Oswal family fortunes. Though this is the tenor of the orders passed by Justice B.N. Kirpal, this is apparent on a perusal of the following extracts from the judgment dated August 12, 1987 : "In order to give ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 75 ( e )Akshay Finance and Trading Co. 200 ( f )Adinath Investment and Trading Co. 500 ( g )Devakar Investment and Trading Co. Pvt. Ltd. 330 ( h )Nahar Investors and Traders Pvt. Ltd. 50 Total 3,065 IIC. Names of three public limited companies which hold shares in Adhinath and where shares alone will be transferred. Name of the company No. of shares ( a )Santon Finance and Investment Co. Ltd. 19,995 ( b )Flamingo Finance and Investment Co. Ltd. 30,000 ( c )Ramaniya Finance and Investment Co. Ltd. 50,000 Total 99,995 IID. Names of the firms which hold shares in Adinath and where shares alone will be transferred. Name of the firm No. of shares Registered in the name of ( a )Amber Syndicate 25,350 D.K. Oswal 25,000 R.C. Oswal 350 ( b )Paras Syndicate 30,000 D.K. Oswal ( c )Adinath Syndicate 30,000 S.P. Oswal Total 85,350 III. Names of the inves ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o purchase the said shares of Shreyans to be sold by Vardhman. ( v )Both the groups will file appropriate applications with the financial institutions and see the release of personal guarantees of the petitioner and members of his group which may have been given for financial arrangement extended by the institutions to Vardhman and Mahavir and also the release of guarantees of R.C. Oswal and members of his group which may similarly have been given to the financial institutions or other institutions for extending the financial assistance to Shreyans and Adinath. ( vi )Both the groups are directed to take all steps which may be necessary to give effect to the transfer of shares and management of Shreyans and Adinath to D.K. Oswal and his group and the transfer of shares of Vardhman and Mahavir by D.K. Oswal members of his group in favour of R.C. Oswal and his group. ( vii )Parties are at liberty to apply to this court, from time to time if the need arises, for directions or clarifications which may be necessary in order to give effect to the settlement of dispute between the parties. The company petitions are disposed of in the aforesaid terms. The parties shall bear their ow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e court may retain the power to pass orders which are calculated to implement the orders previously passed by it when it possesses jurisdiction over the lis. The present dispute, as has already been stated is essentially different to the factual matrix and the prayers contained in C.P. No. 21 of 1986, and for that matter in all the other C.P. Nos. 21 and 26 of 1986. Mr. Bhushan has himself adverted to the will of the late R.C. Oswal, which has become operative several years after the disposal of C.P. No. 21 of 1986. The genesis of the present disputes can be traced back to the allotment of 10,000 shares in 1998, and the resultant alteration of the control of Vardhman Polytex. Mr. Bhushan has also mentioned changes in the board of directors of that company and Mahavir Spinning and General Mills which occurred in August 2000. Quite obviously, this has no bearing on the facts which existed in 1986. The heading of the applications mentions that they are pursuant to the demise of Shri R.C. Oswal. 11. Before departing from this aspect of the case it is of extreme relevance that the registered offices of the companies which were within the purview of the six petitions which had rece ..... X X X X Extracts X X X X X X X X Extracts X X X X
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