SHIJU JACOB VARGHESE Vs. TOWER VISION LTD

JUDGEMENT

(1.) This order shall dispose of IA No. 4784/2012 under Order 39 Rule 4, CPC, IA No. 4785/2012 under Sections 16 to 19, CPC and IA No. 4786/2012 under Order 7 Rule 11, CPC filed by the defendants.

(2.) Before I proceed to decide these applications, a brief narration of the facts of the case as set out by the plaintiffs and germane to the controversy are that the plaintiffs have filed the present suit for perpetual and mandatory injunction, declaration and rendition of accounts against the defendants. The plaintiff no.1 is stated to be a Non Resident Indian based in United Kingdom having expertise in providing consultancy services relating to business setup in the telecom sector all over the world, more particularly in India. The plaintiff no.2 is a Limited Liability Partnership incorporated under the laws of the United Kingdom wherein the plaintiff no.1 along with one Triassic Investments Ltd. are the members. The defendant no.1, Tower Vision Limited, TVL, is a company incorporated in Israel. The case of the plaintiffs is that the promoters of defendant no.1 company had approached the plaintiffs sometime in the year 2004-05 for setting up the Cellular Tower Business in India and it was promised by the defendant no.1 that in return the plaintiffs would be given sizeable share in the business of defendant no.1 company apart from compensating the plaintiffs for their expert services. Such a promise made by the defendant no.1 was duly recorded in the First Consultancy Agreement dated 1.8.2005, wherein it was specifically agreed that apart from the compensation for its services, the plaintiff no.2 shall also have an irrevocable right to purchase 7% equity shares of the defendant no.1 company at any time for a nominal sum. With the execution of the said Consultancy Agreement, the plaintiff no.1 started providing all inputs, services and expertise required for setting up the Tower Management business in India. After the platform for the launch of the said business was ready, the defendant no.1 incorporated a company under the name and style of Tower Vision India Pvt. Ltd., i.e. TVIL, the defendant no.3 herein on 27.1.2006. The defendant no.1 then formed a Limited Partnership in Israel, TVLP, defendant no.2 herein, by way of a Limited Partnership Agreement dated 26.3.2006 for inter alia making worldwide investments in the field of Telecom Tower Management. Under the said Limited Partnership Agreement, the defendant no.1 company was made the General Partner of the partnership and in terms of Clause 9 of the same, it was vested with absolute, unlimited and unfettered rights and control over the entire management/ business of the partnership along with the powers to execute and enter into any binding agreements on behalf of the partnership including the right to encumber the business of the partnership. In pursuance of the said agreement, the plaintiffs in a very short span of time were able to secure huge tower erection and management contracts for the defendant no.3 company with various telecom companies including award of a contract for US$ 65,000,000 (approx. Rs.275 crores) for providing 1000 nos. of cellular tower sites for M/s. Spice Communications Ltd. Under Clause 15 of the said Limited Partnership Agreement, the plaintiffs? 7% right in the said business as per the First Consultant Agreement, was secured by creating a trust in the name of a trustee i.e. defendant no.6 herein, for holding 7% of the partnership?s capital in trust for the benefit of the plaintiffs. Then sometime in April/ May 2006, the defendant no. 2 incorporated another company in Mauritius i.e. M/s. Tower Vision Mauritius Limited, TVML, defendant no.4 herein and consequently 99.99% shares of the Indian company i.e. defendant no.3 were vested in the said TVML and 1 share (0.01% share) of the said Company was vested in another group company i.e. M/s. Tower Vision Jersey Ltd., TVJL, defendant no. 5 herein. As per the plaintiffs, in a way the entire share capital and control of the defendant no.3, the Indian company rested with the defendant no.1 which was the General Partner of the defendant no.2 partnership. Thereafter, with a view to confirm an absolute and unconditional 7% right/interest in the business of the Limited Partnership in favour of the plaintiffs, a separate Share Entitlement Document dated 17.10.2006 was executed by defendant no. 2 partnership. In the said document, the defendant no.2 also confirmed that in case of any structural changes resulting in the partners holding their interest in the Tower Management business through any other entity, the plaintiffs would be entitled to receive their absolute and unconditional 7% rights in any such entity which would be established by the partners of the partnership. It was also clarified in the said document that the Tower Management business of the partners as on that date was being carried out via? Tower Vision Mauritius Limited. It is the case of the plaintiffs that on or about 21.11.2006, the plaintiff no.1 made a request to defendant nos. 1 and 2 to transfer the said 7% rights in favour of M/s Triassic Investments Ltd. based on the said Share Entitlement Document granting an absolute and unconditional 7% rights to the plaintiffs in the partnership business. As per the plaintiffs, they were informed by the defendants that they were processing the transfer of the said rights to the nominated entity but factually no such transfer of the 7% rights of the plaintiffs was affected by the defendants in favour of the said nominated entity. The plaintiffs felt disturbed by the apathy and indifference shown by the defendant Nos. 1 and 2 to the request made by them and with a view to seek enforcement of the same, the plaintiffs approached the District Court in Tel Aviv, Israel vide Civil File No. 2192/2008 and the said proceedings are still pending consideration before the said Court.

(3.) Along with the present suit, the plaintiffs filed an application under Order 39 Rule 1 and 2 read with Section 151 of CPC, for the grant of interim stay. Vide ex-parte order dated 20.1.2012, the defendant nos. 2,3 and 4 were ordered not to prejudicially affect 7% share of the plaintiffs in any manner and were restrained from diluting any of their share holdings to that extent in favour of any third party.