BALKRISHNA GARODIA Vs. NIKUNJ KUMAR LOHIA AND ORS.

JUDGEMENT

(1.) There are two execution applications for enforcement of an arbitral award dated 3rd October, 1983. It was passed by two Joint Arbitrators chosen by the parties and approved by this court by an order dated 10th August, 1983. This award was made a rule of this court on 21st September, 1984. In the proceedings before this court in 1983 and before the learned arbitrators there were two sets of parties divided into two groups. Hari Prasad Lohia and Narayan Prasad Garodia constituted the first group. Omprakash Bhartia, Haricharan Garodia and Bal Krishna Garodia constituted the second group. The petitioner belongs to the second group.

(2.) The award proceeds as follows. Three companies were involved. East India Cotton Manufacturing Co. Ltd. referred to as the "Cotton company", Fibre Processors Pvt. Ltd. referred to as the "Fibre company" and East India Fabrics Manufacturing Co. Ltd. referred to as the "Fabric company". Before the award, the Fibre and Fabric companies belonged to the first group. 3843 equity shares of the Fabric company and 4,000 equity shares of the Fibre company together with the blank signed transfer deeds were in the possession of the Joint Arbitrators. The award recorded that the shares and transfer deeds were handed over to the second group. The award further said. "We adjudge and hold that the said 3843 equity shares in the said Fabric company and the said 4000 equity shares in the said Fibre company shall be deemed to have been transferred by the first group to the second group or its nominee or nominees." All the directors of the Fabric and the Fibre companies would have to resign.

(3.) In their place nominees of the second group would have to be appointed as directors. The award also recorded that all statutory books of these companies were handed over to the second group together with other records, books of accounts etc. The award went on to say that 27,770 equity shares in the Cotton company belonging to the second groups, before the award were in the possession of the Joint Arbitrators together with blank transfer deeds were handed over to the first group. All statutory books, other documents and records were also similarly handed over by the second to the first group. The first group would have to indemnify the second group against all claims after 27th April, 1980. The transfer of business was with effect from 27th April, 1980.