CICO TECHNOLOGIES LTD Vs. FRC COMPOSITES LTD

JUDGEMENT

(1.) THE plaintiffs have sued for specific performance of an agreement by the defendant No. 1 of sale of 40% shares of the plaintiff No. 2 company held by the defendant No. 1 in favour of the plaintiff No. 1 for a sale consideration of canadian $ 25,000. The plaintiffs have claimed the alternative relief of recovery of compensation/damages with interest. The plaintiffs have also claimed the relief of permanent injunction restraining the defendants from interfering in the working of the plaintiff companies and of restraining the defendants from carrying on business in India under the name FRC Composites Ltd and from selling goods under the trade name "tapecrete" and/or entering into any business transactions with any other person or company with respect to the business conducted by the plaintiff No. 2.

(2.) THE counsel for the defendants appeared on the very first date when the suit was listed. It appears that there were some other connected litigations also pending and the present suit was ordered to be listed in the same court where the said other litigations were pending. The defendants filed an application under Section 8 of the Arbitration and Conciliation Act, 1996. The said application remained pending for long. None appeared for the defendants on 16th January, 2007 and the application under Section 8 was dismissed in default. The defendants had not filed the written statement. The defendants were proceeded against ex parte and remain ex parte. The plaintiffs have led their ex parte evidence.

(3.) IT is the uncontroverted evidence of plaintiffs that the plaintiff No. 2 company, namely, M/s FRC Composites India Pvt Ltd was set up by the plaintiff no. 1 in collaboration with the defendant No. 1, a Canadian Company. It is further the case of the plaintiffs that in accordance with the said collaboration agreement, the defendant No. 1 came to hold 40% shares of the plaintiff No. 2 company; that though the collaboration came to an end but the defendant No. 1 continued to hold the said share holding in the plaintiff No. 2 company; that ultimately defendant No. 1 offered to sell its said 40% share holding in the plaintiff No. 2 company to the plaintiff No. 1 for a consideration canadian $25,000. Correspondence/communications of the year 1999 in this regard have been proved as Exhibit PW1/5 to Exhibit PW1/8. The plaintiff in pursuance to the said agreement is also proved to have applied for and obtained the permission of the Reserve Bank of India for remitting Canadian $25,000 to the defendant No. 1. The transaction is, however, stated to have been held up owing to the demise of Mr Ergo Karuks, President of the defendant No. 1; defendant no. 2 being daughter of the said Mr Ergo Karuks and who is stated to have come into control of the defendant No. 1 on the demise of her father is also stated to have initially promised to abide by the aforesaid agreement but is stated to have subsequently wriggled out of the same. Hence this suit.