IMPORTANT POINT
In cases of such nature mediation could be a better choice.

Headnote:(a) Constitution of India – Article 142 – Many cases of different nature between the parties pending in different courts – Not possible to resolve all those cases by exercise of power under Article 142. (Para 20)
       (b) Companies Act, 1956 – Section 397 and 398 – Company petition pending – Interim order giving rise to as many as 80 cases of different nature – Early adjudication of main company petition imperative for early and amicable resolution of the disputes – Directions given. (Para 21)
       (c) Code of Civil Procedure, 1908 – Section 89 – Alternative Disputes Resolution – Mediation – A shift from adversarial litigation – Can build and improve relationships among the parties – New dimension of access to justice. (Para 15, 16, 18)
       Facts of the case:
       SLP(Crl) No. 6873 of 2010
       The respondents (the Khosla Group) are the owners of the prime lands in Kasauli, District Solan, Himachal Pradesh. Legally, this land is owned by Montreaux Resort Pvt. Ltd. (MRL). Shares of the MRL were earlier exclusively held by the family members of the Khosla Group.
       The petitioners (the Bakshi Group) extended its helping hand for developing the property as a resort. MOU dated 21.12.2005 was entered into between Mr. Deepak Khosla, Mr. R.P. Khosla, MRL and Mr. Vikram Bakshi. The project was joint venture between the Khosla Group and Mr. Vikram Bakshi wherein the Bakshi Group was to pump in the necessary finances and to take charge of administration by managing the entire project. MRL was the special purpose vehicle for the execution of the project. The MOU envisaged transfer of shareholding in MRL by Khosla Group to Vikram Bakshi on certain demands made by the latter to the former.
       Pursuant to the MOU dated 23.12.2005, Mr. Vinod Surah and Mr. Wadia Prakash (nominees of Mr. Vikram bakshi) were appointed as Additional Directors of MRL. An agreement dated 31.3.2006 was entered, for executing the proposed project, between the respondent, Ms. Sonia Khosla, wife of Mr. Deepak Khosla, Mr. R.P. Khosla, MRL and Mr. Vikram Bakshi. The agreement recorded that 51% shareholding in the company had been transferred to Mr. Vikram Bakshi.
       For some reasons the project did not kick off and ran into rough weather. It led to filing of a petition under Section 397 and 398 of the Companies Act by Ms. Sonia Khosla against Bakshi Group, though in that petition she impleaded some of the members of Khosla family also as respondents. Her allegation was that she held 49% shares in the Company which had been further reduced to 36% and that the affairs of the Company were being managed in a manner oppressive to the minority shareholders. In this petition she admitted that majority shareholding was with Mr. Vikram Bakshi.
       The Company Law Board (CLB) directed maintenance of status quo with regard to the shareholding and the Directors of the Company as it existed on the date of the filing of the petition i.e. 13.8.2007. Observations were made in this order that the respondent-Sonia Khosla had tried to overreach the CLB by changing it composition and to increase the share capital of the Company.
       Ms. Sonia Khosla filed an application under Section 340 of the Code of Criminal Procedure (Cr.PC) before the CLB alleging that forged documents were filed before the CLB. However, while this application is still pending before the CLB, in October, 2008 she filed another application under Section 340 Cr. PC in the High Court of Delhi on the same very grounds which were taken in the application before CLB. She sought prosecution of the petitioners under Section 195(i)(b)(ii) read with Section 340 Cr. PC alleging that the minutes of the AGM of the Company allegedly held on 30.9.2006 were forged.
       In this application orders dated 15.2.2010 are passed by the High Court and that order is the subject matter of challenge in the present proceedings. As can be easily discerned, the petitioners' main contention is that application u/s 340 Cr. PC is not maintainable.
       SLP(C)No. 23796-98 of 2010
       In the Company Petition filed by Ms. Sonia Khosla interim orders dated 31.1.2008 were passed by the CLB directing the parties to maintain status quo with regard to shareholding and the Directors of the Company as it existed on the date of filing of the Company Petition i.e. 13.8.2007. The consequences thereof was not to give effect to the purported Board meeting of the Company on 14.12.2007 wherein Mr. Deepak Khosla and Mr. R.K. Garg were inducted as Directors and there was also an allotment of 6.58 lakhs equity shares to the persons of Khosla Group.
       Whereas appeal filed by Mr. R.P. Khosla was dismissed by the High Court, the appeal of Ms. Sonia was dismissed on merits and the Review Petitions filed by both of them were also dismissed. The effect of the status quo ante order was that he could not be treated as the Director of the Company during the subsistence of the said order.
       Simultaneously, the High Court has also stayed the operation of the orders dated 31.1.2008 passed by CLB in so far as it has cancelled the shareholding and Directorship of Respondent No. 1. The instant present Special Leave Petition impugns the aforesaid order dated 13.4.2010 passed by the High Court, primarily on the ground that since the appeal is time barred till the delay is condoned there is no appeal in the eyes of law and, therefore, the High Court could not have passed interim orders.
       Finding of the Court:
       More appropriate orders would be to direct the parties to maintain status quo in the meantime, during the pendency of the aforesaid company petition before the CLB.

JUDGMENT

A.K. SIKRI, J. –

1. A spate of litigation between the two groups depicts a severe fight between them where settlement appears to be a distant dream, at least as of now, with tough positions taken and on each and every facet/ nuance of the disputes, they have joined issues. However, we are happy to find consensual approach on one aspect at least viz. the future course of action that needs to be adopted in these matters which have landed in this Court (albeit against interim orders) as the proceedings are still pending at different levels either in the Company Law Board or in the High Court.

This much positive stance, aimed at cutting the corners and edging out the niceties for early resolution of the main dispute between the parties needs to be commended. For this reason, apart from stating the controversy involved in each of the matters, our purpose would be served in stating the course of action which needs to be adopted, as agreed between the parties, without going into the nitty gritty of the issues involved. With this introduction we describe hereinbelow the nature of the dispute in these petitions. SLP(Crl) No. 6873 of 2010

2. When the two parties joined together for collaborative business venture, it is but natural that the relationship starts with mutual trust and faith in each other. At the time of fostering such a relationship, they expect that with joint efforts in the proposed business venture, they would be able to achieve unparallel milestones, which would otherwise be impossible with their individual efforts.

The joining together is with the aim of making one plus one as eleven and not two. However, over a period of time, if due to unfortunate and unforeseen circumstances/ events, the relationship becomes bitter and the two collaborative partners fall apart, it results in a position where one minus one is not only reduced to zero but becomes negative. That perhaps is the story of the present litigation and if the disputes are not resolved early, either by adjudicatory process or amicably between the parties, the negative factor will keep growing and keep widening its fangs which may not be conducive to any of the litigants before us.

3. The respondents herein (hereinafter referred to as the Khosla Group) are the owners of the prime lands in Kasauli, District Solan, Himachal Pradesh. Legally, this land is owned by Montreaux Resort Pvt. Ltd. (MRL, for short) and share holding of the MRL was earlier exclusively held by the family members of the Khosla Group. It was their vision to develop this real estate into a tourist resort of repute. The Khosla group needed requisite finances and administrative expertise for this purpose.

The petitioners (hereinafter referred to as the Bakshi Group) extended its helping hand. In fact it was conceived as a dream project of both the groups. For this purpose MOU dated 21.12.2005 was entered into between Mr. Deepak Khosla, Mr. R.P. Khosla, MRL and Mr. Vikram Bakshi. The project was joint venture between the Khosla Group and Mr. Vikram Bakshi wherein the Bakshi Group was to pump in the necessary finances and to take charge of administration by managing the entire project. MRL was the special purpose vehicle for the execution of the project. The MOU envisaged transfer of shareholding in MRL by Khosla Group to Vikram Bakshi on certain demands made by the latter to the former.

4. Pursuant to the MOU dated 23.12.2005, Mr. Vinod Surah and Mr. Wadia Prakash (nominees of Mr. Vikram bakshi) were appointed as Additional Directors of MRL. An agreement dated 31.3.2006 was entered, for executing the proposed project, between the respondent, Ms. Sonia Khosla, wife of Mr. Deepak Khosla, Mr. R.P. Khosla, MRL and Mr. Vikram Bakshi. The agreement recorded that 51% shareholding in the company had been transferred to Mr. Vikram Bakshi. The said agreement, inter alia, provided that:

(a) Land for the project shall be purchased in the name of MRL.

(b) The responsibility of development of lands, managing th

Click Here to Read the rest of this document

2014 Supreme(SC) 413

IMPORTANT POINTIn cases of such nature mediation could be a better choice.

IMPORTANT POINT
In cases of such nature mediation could be a better choice.