RUCHI AGARWAL Vs. NICOLIAN INDIA

JUDGEMENT

(1.) THESE four petitions challenge Award dated 10th June 2006 passed by the sole Arbitrator in the disputes between the predecessor in interest of the Petitioners late Mr. Rakesh Agarwal and Respondent No.1 in each petition.

(2.) THE facts in OMP No.446 of 2006 are that Respondent No.1, Nicolian (India) Private Limited (subsequently renamed as Nicolian Securities and Finance Pvt. Limited) deposited a sum of Rs.50,08,500 with Respondent No.3, Gulmohar Estates Limited ('GEL') for the purpose of booking of properties in Garden Estates, Gurgaon, a project being executed by GEL. It is stated that the amount was advanced by two cheques dated 31st July 1991 for the sums of Rs.24,84,000 and Rs.25,24,500 respectively. Late Mr. Rakesh Agarwal, the predecessor in interest of the Petitioners and Mr. Rakesh Agarwal (HUF) executed a deed of personal guarantee on 31st July 1991 whereby both Mr. Rakesh Agarwal, as well as Rakesh Agarwal (HUF) stood guarantee for the payments of the advance made by Respondent No.1 to GEL. It was assured that in the event GEL failed to allot the property by 31st March 1996 or such other extended time as may be agreed in writing by Respondent No.1, the amount paid towards the booking of the property would be refunded with interest at 24% per annum. It is stated that in order to secure the advance of Rs.50,08,500 made by the Respondent to GEL, another company named Apogee International Ltd. ('AIL') executed a corporate guarantee dated 31st July 1991 in favour of Respondent No.1. AIL was holding more than 75% shareholding in GEL. AIL authorized late Mr. Rakesh Agarwal as its Attorney to enable him to execute the deed of corporate guarantee dated 31st July 1991 on behalf of AIL. It is the case of the Respondent No.1 that both GEL and AIL were under the effective control of late Mr. Rakesh Agarwal inasmuch as he was holding 7.07% shareholding in GEL and 46.4% in AIL. According to Respondent No.1, late Mr. Rakesh Agarwal was a promoter Director in AIL and his wife, Mrs. Ruchi Agarwal was only a dummy Director put up by Mr. Rakesh Agarwal in AIL. She did not hold any share in her own name. With late Mr. Rakesh Agarwal holding 46.4% in AIL and his father late Mr. Radhey Shyam Agarwal holding 25.81% of the shares, it was claimed that AIL was a company controlled by Mr. Rakesh Agarwal and his family. With the expiry of Mr. Radhey Shyam Agarwal, the effective shareholding of Mr.Rakesh Agarwal increased to 72.45% of the total shareholding.

(3.) IT is stated that after negotiations between the parties, an agreement was entered into on 18th November 1999 between Respondent No.1, late Mr. Rakesh Agarwal, Rakesh Agarwal (HUF), GEL and AIL whereby it was agreed that the entire shareholding of late Mr. Rakesh Agarwal, Rakesh Agarwal (HUF) and AIL in HBL would be transferred in favour of Respondent No.1. IT was also agreed that the entire liability of GEL, late Mr. Rakesh Agarwal, Rakesh Agarwal (HUF) and AIL would stand discharged subject to the transfer being effected on or before December 2000.