1. :- This revision petition has been preferred against the order dated 9.4.1996 passed by learned ADJ No. 3. Jaipur City, Jaipur in CMA No. 29/95 against the order dated 2.3.1995 passed by Civil Judge (Junior Division) Jaipur City (East) Jaipur in Case No. 304/94 by which the said court dismissed the appeal of the petitioner.

2. The facts which are relevant for deciding the controversy between the parties briefly stated are that the petitioner is a retired Lt. Colonel from the armed forces and after his retirement in the year 1982, he established a Tannery in the name and style of Excusite Enterprizes in Faridabad (Haryana) as a partnership concern. In August 1992, the petitioner was introduced to respondent No. 1 who is NRI. The latter had approached the petitioner for technical and administrative help to re-start the sick industry namely: Rajasthan State Tannery Tonk Pvt. Ltd. at Tonk. He also asked the petitioner to join his company as above. The petitioner accepted this offer and was allocated 35% shares on 6.9.1992 and he was also made one of the Directors of the said company. There was one more Director namely Major Vijay Bhatnagar since expired, his widow Mrs. Asha Bhatnagar respondent No. 2 has been made Director without any shares.

3. The Rajasthan State Tannery Pvt. Ltd. Tonk which was a State Government Enterprise and was established in 1973, was never run properly. Its paid up capital and reserves, etc. were Rs. 1,79,00,000/-, while upto 1985 it had suffered a total loss of Rs. 3,19,000/- and it was closed in 1985. The State Govt. tried to hand over this industry to a private sector, but it could not be given. In 1992, respondent No. 1 offered to take this industry from the State Govt. on the following basis:

1. IDBI DUES-Rs. 88 lacs to be paid TTPL in 14 half yearly instalments, with interest @ 15% from the start up of production with one year moratorium.

2. Bank of Baroda-Rs. 75 lacs to be paid as above.

3. Other Creditors-Other creditors including Government of Rajasthan and labour etc. Rs. 30.15 lacs.

4. In pursuance of the aforestated proposal, the State Govt. issued a letter of intent through its Department of Public Enterprise in August, 1992 containing the following conditions:

(A) Government agrees to transfer the entire share holding of Rajasthan State Tanneries Ltd. of the face value of Rs. 194.16 lacs at a token consideration of Rs. 1000/- in favour your newly formed Company M/s. Tonk Tanneries Pvt. Ltd. (TTPL) on their terms and conditions are set out below:

(a) an agreement to transfer shall be entered between the State Government, Rajasthan State Tanneries Ltd. and M/s. Tonk Tanneries Pvt. Ltd. for the implementation within a period of 90 days of the date of agreement.

(b) a security of Rs. 5 lacs (inclusive of Rs. 50,000/- already received the earnest money) shall be given by M/s. Tonk Tanneries Pvt. Ltd. to the State Government. The security shall be liable to be forfeited in case of non compliance of the agreement within the stipulated time. Time could be extended on reasonable grounds by the State Government on the request of M/s. Tonk Tanneries Pvt. Ltd. after enhancing the security to a reasonable limit as decided by the Government.

(c) M/s. Tonk Tanneries Pvt. Ltd, will settle outstanding liabilities of IDBI to their entire satisfaction, Government shall, however, assist for getting the relief from IDBI as far as possible. Government shall not be responsible for any controversy in finalisation of the agreement between IDBI and M/s. Tonk Tanneries Pvt. Ltd. The Government shall not be responsible for any outstanding liability towards IDBI.

(d) M/s. Tonk Tanneries Pvt. Ltd. will settle outstanding liabilities of Bank of Baroda to their entire satisfaction as stipulated in para (c) above.

(e) M/s. Tonk Tanneries Pvt. Ltd. will pay Rs. 30.15 lacs to the State Government against current liabilities. Rs. 10.00 lacs will be paid by the Tonk Tanneries Pvt. Ltd. at the time of agreement and remaining Rs.