Kapoorchand A.Singhvi & Ors. vs Pooja Gambhir & Ors.
2009 Latest Caselaw 4322 Del

*          IN THE HIGH COURT OF DELHI AT NEW DELHI

                                            Date of Reserve: September 24, 2009
                                                Date of Order: October 26, 2009
+OMP 540/2009
%                                                            26.10.2009
    Kapoorchand A. Singhvi & Ors.                     ...Petitioners
    Through: Mr. Ashish Aggarwal with Mr. Rajesh Rattan, Advocates

       Versus

       Pooja Gambhir & Ors.                            ...Respondents
       Through: Mr. Harish Malhotra, Sr. Advocate with Mr. Naveen R. Nath,
       Advocates

       JUSTICE SHIV NARAYAN DHINGRA

1.     Whether reporters of local papers may be allowed to see the judgment?

2.     To be referred to the reporter or not?

3.     Whether judgment should be reported in Digest?

       JUDGMENT

1. Petitioners have preferred this petition under Section 9 of the

Arbitration & Conciliation Act, 1996 consequent to OMP No.398 of 2009. An

MOU dated 6th September 2008 was entered into between two groups, one

group consisted of Ms. Pooja Gambhir and Ms. Stuti Gambhir and the second

group was of four persons viz. Mr. Praveen Jain, Mr. Sanjeev Singhal, Mr.

Kapoorchand A. Sanghvi and Mr. Abhay Ram Jain. As per MOU the control of

company M/s TI Steel Pvt. Ltd. had to go to Mr. Praveen Jain and other 2nd

group on performance of certain obligations as given in the MOU and on

payment of amount as reserved in MOU to the first party i.e. Ms. Pooja

Gambhir and Ms. Stuti Gambhir. Petitioner in this petition is Mr. Kapoorchand

A. Sanghvi son of Shri Ashmal G. Sanghvi and he has made Mr. Praveen Jain,

Mr. Abhey Ram Jain, Mr. Sanjeev Singhal as respondents. There are many

other names given in the Memo of Parties of this petition who are not parties

to the MOU, viz. petitioner no.2, respondent no.4, 7 and 8. Those person who

OMP No. 540/2009 Kapoorchand A. Sanghvi & Ors v. Pooja Gambhir & Ors. Page 1 Of 3 are not parties to the MOU, cannot be made parties to an application under

Section 9 of the Arbitration & Conciliation Act. Their names are therefore

struck off. Some disputes seems to have arisen among the members of

second group inter se, which are not relevant for purpose of this petition.

2. The contention of petitioners is that after entering into MOU, the

petitioner discovered that there were huge dues over TI Steel Company. The

dues were of Punjab State Electricity Board, Scrappers Electricals Limited,

Hotel Grand Trunk, M/s. Aggarwal Pvt. Ltd., M/s Golden Transport, etc. The

petitioners sent a notice dated 16th January 2009 asking respondents no.1

and 2 to clear all liabilities of the company arising up to 31 st March, 2009. The

respondents no.1 and 2, were to clear the dues as per MOU but did not clear

the same. It is submitted that in view of the fact that respondent no.1 and 2

have to pay heavy amount to ICICI Bank and the respondents failed to pay

their liabilities under MOU despite notice, the petitioner was apprehensive of

a fraud and, therefore, the Court should direct respondents no.1 and 2 to

deposit an amount of Rs.14 crore in the form of FDR either in the name of

petitioner no.3 company or in the name of the Court. It is also submitted that

the Court should grant permission to the petitioners to sell the entire

shareholding of respondent no.1 to 4 and their associates worth Rs.6.98

crores in the said company towards liquidation and payment of dues.

3. A perusal of the petition shows that the petitioner has sought to make

out a case for recovery of the amount from respondents no.1 to 2 forgetting

that Section 9 of Arbitration & Conciliation Act is not meant for recovery of

amount. It is also apparent that the present petition is a counterblast to the

petition filed by respondents no.1 & 2 under Section 9 of Arbitration &

Conciliation Act being OMP No.398 of 2009.

OMP No. 540/2009 Kapoorchand A. Sanghvi & Ors v. Pooja Gambhir & Ors. Page 2 Of 3

4. The MOU between parties provides that in case of breach of terms and

conditions of MOU and MOU can be terminated. Neither the petitioners nor

respondents have terminated the MOU. It seems that both side are trying to

play a game; without actually discharging their obligations under the MOU.

The petitioners in this case along with other persons of Group Two have failed

to make payment to respondents no.1 and 2 in accordance with MOU on the

plea that they had discovered previous liabilities of company payable by

respondents no.1 and 2. The 2nd Group also failed to substitute their own

security in place of security furnished by respondents no.1 and 2 for the loan

taken for operations of the company and used by the company. Now the

petitioner wants permission to sell all the shares of respondents no.1 and 2 as

if the company had not been worth at all and the petitioner had taken up the

company along with other respondents without it's having any worth. I

consider that if the picture had been as grim as painted by the petitioner, the

petitioner would have terminated the MOU and sought restoration of the

status prior to signing of MOU. Second Group could leave the company to

Group One and let Group One manage the company. Instead petitioners are

asking this Court to crystallize the liabilities of both sides under Section 9 and

to direct respondents no.1 and 2 to make payment or give security of the

amount which has not been determined by any process. The present petition

filed by petitioner is nothing but a counterblast and the same is hereby

dismissed being not maintainable with costs of Rs.25,000/-.

October 26, 2009                                   SHIV NARAYAN DHINGRA J.
rd




OMP No. 540/2009    Kapoorchand A. Sanghvi & Ors v. Pooja Gambhir & Ors.   Page 3 Of 3