VIJAY ARORA Vs. EASTERN INTERNATIONAL HOTELS

JUDGEMENT

(1.) By this petition it is prayed that the respondent company be ordered to be wound up under the direction and supervision of this Court under the provisions of Companies Act, 1956 and to appoint Official Liquidator to take charge of all the assets and affairs of the company and to conduct its affairs in due course of winding up and distribute its assets in accordance with law. The title of the petition indicates that the above said relief is claimed in terms of Sections 433(b), 433(f) and 433(g) of the Companies Act, 1956 (hereinafter referred to as "the Said Act" for the sake of brevity").

(2.) Having perused the pleadings and documents on record and considering the rival submissions, I shall straight way proceed to deal with the preliminary objection raised on behalf of the respondent company.

(3.) According to the respondent company, the present petition is filed with mala fide intention or motive. To make good its contention, the respondent is relying on certain circumstances spelt out in paragraph 4.1 of the reply Affidavit. In paragraph 4.1 (i) of the reply Affidavit it is stated that the petitioners have ostensibly filed the said winding-up company petition with a mala fide intention and with an oblique motive so as to achieve the collateral purpose of procuring maximum returns on shares held by the petitioners and their family members in the respondent company. It is stated that the petitioners are part of Arora Family whose shareholding in the respondent company is indicated in paragraph 4. l(ii) of the reply Affidavit. It appears that the petitioner No. 1 holds 600 shares (0.034%), petitioner No. 2 (mother of petitioner No. 1) holds 600 shares (0.034%), Rikhiram Arora (deceased father of the petitioner No. 1) held 50 shares (0.003%), R.T. Arora (HUF-of which petitioner No. 1 is the Karta) holds 50 shares (0.003%) and Amrish Arora (brother of the petitioner No. 1) holds 61,150 shares (3.470%). Here, it is relevant to note that the authorised share capital of the respondent company is Rs. 1.50 crores divided into 12.50 lakh equity shares of Rs. 10/- each. The remaining shares to the extent of 94% are held by two groups namely B.N. Khanna Group and M.P. Khanna Group. According to the respondent, pursuant to the delisting of the respondent company from the Bombay Stock Exchange in July 2004, barring petitioner No. 1 in his personal capacity, the Arora family comprising of the petitioner No. 1 in his capacity as Karta of the R.T. Arora (HUF), the petitioner No. 2 herein, Mr. Amrish Arora (the brother of the petitioner No. 1) and Mr. Rikhiram Arora (the deceased father of petitioner No. 1) have instituted arbitration proceedings against the respondent company and one of the promoter groups, namely, B.N. Khanna Group of the respondent company, requiring them to purchase the Arora family shareholding excluding 600 shares of the petitioner No. 1 at a fair market value to be determined by the arbitral Tribunal. In the said proceedings the Arora family has contended that the most appropriate method for valuation of the Arora family minority shareholding in the respondent company would be the "Net Asset Value method".