A call option creates an irrevocable right to receive shares, and its exercise post commencement of winding up can be validated if bona fides are established.

ORDER. :

ABHAY AHUJA, J.

1. The present Company Application has been filed under Section 536 (2) of the COMPANIES ACT , 1956 (Act) seeking validation of the sale and transfer of 2,34,000 equity shares of Wanderland Real Estates Private Limited (“WREPL”) effected on 4^th September 2014 by Treasure World Developers Private Limited (TWDPL/the Company in Liquidation) in favour of Applicants. The said transfer was effected pursuant to a Memorandum of Understanding dated 01^st March 2009 as amended by agreement dated 23^rd December 2011.

2. The background facts are as under :

2.1 Around 2007 till 2009, the Applicants along with one Mr. Prem Swarup Kalani and one Mrs. Manisha Kalani (Applicant in Interim Application No. 387 of 2020) were holding 267,750 shares in WREPL.

2.2 In 2009, Mr. Manish Kalani Managing Director of Entertainment World Developers Pvt Ltd. (“EWDL”) proposed a collaboration involving its subsidiary TWDPL and WREPL. The existing shareholders, including the Applicants, agreed to the proposal.

2.3 Accordingly, on March 1, 2009 WREPL the Respondent No. 2 herein, TWDPL and the Applicants executed a Memorandum of Understanding (the “MOU”) whereby the Applicants agreed to transfer a total of 2,67,750 shares (“Sale/Subject Shares”) of WREPL amounting to 51% of WREPL’s equity shares to TWDPL for a total consideration of Rs. 80,32,500/-. As per the terms of the MOU and in particular Article 4.2 read with Annexure C, TWDPL was required to infuse Rs. 29.53 crores into WREPL within 9 (nine) months. And as per Article 5 of the MOU, a right was to be vested in the Applicants herein to exercise a call option in the event of TWDPL not complying with its obligations under Article 4.2 or 4.3 of the MOU.

2.4 On July 9, 2009, WREPL requested TWDPL to infuse Rs. 29.53 crores in WREPL within 9 months from the date of execution of the MOU, in terms of Article 4.2 read with Annexure C of the MOU. That on July 24, 2009 TWDPL replied to WREPL requesting extension of the timeline for infusion of funds upto December 2010 and assured WREPL that TWDPL shall raise the required funds within a period of 12-18 months from July 24, 2009.

2.5 On July 30, 2009 WREPL wrote to TWDPL agreeing to extend the timeline for infusion of funds upto June 30, 2010 and stated that a further extension beyond this period would not be possible.

2.6 On January 25^th 2010, TWDPL wrote to WREPL again requesting for additional time to infuse funds and extension till March 31, 2011 as TWDPL’s Parent Company EWDL was planning to raise funds by way of an IPO.

2.7 That thereafter on March 19, 2010 WREPL reiterated that an extension beyond June 30, 2010 would not be possible and stated that if TWDPL failed to meet the June 30, 2010 deadline, WREPL would invoke the call option as provided under Article 5 which reads as follows :

“the Transferors shall any time after that have the right to (by way of written notice to be sent by the Authorized Person) require TWDPL to sell the Sale Shares back to the Transferors in such proportion as stated by the Authorized Person in the said notice (“Notice”). TWDPL shall in such an event deliver to the Transferors the relevant original share certificates and duly executed share transfer form