Delhi High Court
Roger Shashoua & Others vs Mukesh Sharma & Others on 2 February, 2022
Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:08.02.2022
09:06:40
$~1 & 2 (OS)
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of Decision: 2nd February, 2022
+ O.M.P. (COMM) 88/2020
ROGER SHASHOUA & OTHERS ..... Petitioners
Through: Mr. Anil Airi, Sr. Advocate with Mr.
Gaurav M. Liberhan, Mr. Mudit
Ruhella, and Mr. Neeraj Gupta,
Advocates. (M:9810955779)
versus
MUKESH SHARMA & OTHER ..... Respondents
Through: Mr. Akhil Sibbal, Sr Advocate with
Mr. Abhinav Hansaria, Mr. Nikhil
Sharma and Ms. Deboshree
Mukherjee, Advocate for R-1.
(M:9810349842)
Mr. Jayant K. Mehta, Sr. Advocate
with Ms. Neeru Sharma, Advocate for
R-2.
Mr. Deepak Kumar Vijay, Advocate
for R-3. (M:9311279321)
AND
+ O.M.P. (EFA)(COMM) 3/2018
ROGER SHASHOUA & ORS. ..... Petitioners
Through: Mr. Anil Airi, Sr. Advocate with Mr.
Gaurav M. Liberhan, Mr. Mudit
Ruhella, and Mr. Neeraj Gupta,
Advocates.
versus
MUKESH SHARMA & ORS. ..... Respondents
Through: Mr. Akhil Sibbal, Sr Advocate with
Mr. Abhinav Hansaria, Mr. Nikhil
Sharma and Ms. Deboshree
O.M.P. (COMM) 88/2020 & O.M.P. (EFA)(COMM) 3/2018 Page 1 of 15
Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:08.02.2022
09:06:40
Mukherjee, Advocates for R-1.
Mr. Jayant K. Mehta, Sr. Advocate
with Ms. Neeru Sharma, Advocate for
R-2.
Mr. Deepak Kumar Vijay, Advocate
for R-3.
CORAM:
JUSTICE PRATHIBA M. SINGH
Prathiba M. Singh, J.(Oral)
1. This hearing has been done through video conferencing.
I.A.13340/2021 in O.M.P. (COMM) 88/2020
EX.APPL.(OS) 1149/2021 in O.M.P. (EFA) (COMM.) 3/2018
2. These are two applications under Section 151 CPC seeking to bring
on record the death certificate of Petitioner No.1 - Mr. Roger Shashoua
(hereinafter "Petitioner No.1"), who is stated to have passed away on 22nd
January, 2021 and seeking his deletion from the memo of parties. Mr. Akhil
Sibal Sr. Adv., submits that these two applications may be taken up before
re-commencement of hearings in the main matters as Petitioner No.1 has
passed away last year.
3. The background of these matters is that these are two petitions under
Sections 47 and 49 of the Arbitration and Conciliation Act, 1996
(hereinafter "A&C Act"), which this Court is considering for enforcement
and execution of two separate foreign awards, a partial final award as to
liability dated 5th January, 2010 and the final award dated 1st August, 2011
(hereinafter collectively "Arbitral Awards"). The awards were rendered out
of arbitral proceedings between Petitioner No.1, Rodemadan Holdings
Limited/Petitioner No.2 (hereinafter "Rodemadan"), Stancroft Trust
Limited/Petitioner No.3 (hereinafter "Stancroft"), and Mr. Mukesh
O.M.P. (COMM) 88/2020 & O.M.P. (EFA)(COMM) 3/2018 Page 2 of 15
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Signing Date:08.02.2022
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Sharma/Respondent No.1 (hereinafter "Respondent No.1"), ITE India Pvt.
Ltd./Respondent No.2 (hereinafter "ITE") and M/s International Trade
Expocentre Ltd./Respondent No.3 (hereinafter "ITEC").
4. Disputes arose out of shareholders agreement dated 1st July, 1998
executed between Petitioner No.1, Respondent No.1 and ITEC (with only
Petitioner No.1 and Respondent No.1 being referred to as parties)
(hereinafter "SHA") and were referred for arbitration by a 3-member
tribunal under the ICC Rules of Arbitration, Paris. Submissions in these
matters had been heard in part, prior to the outbreak of the COVID-19
pandemic and subsequently, the matters could not be listed for hearing
during the pandemic.
5. The matters were listed post the pandemic and hearings resumed
today. The Court has been informed that Petitioner No.1 has passed away on
22nd January, 2021 during the pandemic and consequently, these
applications have been moved to take the death certificate of Petitioner No.1
on record and seek his deletion from the memo of parties.
6. In both these applications, the case of the applicants, who are now
Petitioner Nos.2 & 3, namely Rodemadan and Stancroft, is that prior to
passing of the Arbitral Awards themselves, Petitioner No.1 had transferred
his shares in ITEC and assigned the same to Rodemadan, his nominee
company. The applicants submit that this fact is also mentioned in various
places during the proceedings including the earlier partial awards which
were passed. The relevant extract from the rejoinders filed by the applicants
in these applications is as under:
"2. That Respondent No.3 is aware of the fact that
though late Roger Shashoua was a signatory to the
O.M.P. (COMM) 88/2020 & O.M.P. (EFA)(COMM) 3/2018 Page 3 of 15
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By:DHIRENDER KUMAR
Signing Date:08.02.2022
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Shareholders Agreement (SHA), and he had already
assigned his rights in favour of the Petitioner herein.
This fact is recorded in the Award and no objection
was ever raised to this assignment. The following
para in the award dated 05.01.2020 records the
shares transferred by late Roger Shashoua to his
nominee company:
"1.19....
1.19(2) In 2000 Mr. Shashoua transferred all
his shares to Rodemadan, his nominee
company. At about the same time, Mr. Sharma
transferred 1 million of his shares to his
nominee company, ITE India.""
7. The applicants submit that thus, the entire interest in the Arbitral
Awards now vests in Rodemadan and Stancroft, being the surviving
Petitioners, and the death certificate of Petitioner No.1 is, accordingly,
prayed for being taken on record, with deletion of Petitioner No.1 from the
memo of parties.
8. Mr. Anil K. Airi, ld. Senior Counsel appearing for the applicants,
submits that the Respondents are well aware of the fact that even in the
arbitral proceedings, the clear stand of the Petitioners was that all of the
shareholdings were assigned by Petitioner No.1 to Rodemadan. In such a
situation, the right to sue only survives in Rodemadan and Stancroft and not
in the legal heirs of Petitioner No.1.
9. These applications are objected to by Mr. Sibal, ld. Senior Counsel
appearing on behalf of the Respondents, on the ground that Petitioner No.1 -
Mr. Roger Shashoua, was an individual and therefore, his legal heirs ought
to be impleaded in these matters.
10. He further relies on the provisions of Order XXII Rules 1 to 3 CPC,
stating that it is only if the right to sue does not survive in favour of the legal
O.M.P. (COMM) 88/2020 & O.M.P. (EFA)(COMM) 3/2018 Page 4 of 15
Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:08.02.2022
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heirs of a party and the right to sue survives in favour of other plaintiffs, that
the legal heirs are not required to be brought on record. He submits that the
very fact that Petitioner No.1 continued to be a party to these proceedings in
this Court, even after the transfer of his shares, itself proves that he was a
necessary and proper party in the proceedings, hence, now his legal heirs
ought to be impleaded in order to proceed further in the matter.
11. The Court has heard the counsels for the parties. As can be seen from
the record, the awards of which enforcement is being sought, are dated 5th
January, 2010 and 1st August, 2011. These matters have been pending for
several years now for enforcement of these foreign awards. Petitioner No.1
has passed away during the pendency of these petitions and it is the case of
Petitioner Nos.2 and 3 that the right to sue survives in their favour. On the
other hand, the case of the Respondents is that the legal representatives of
Petitioner No.1 ought to be impleaded.
12. On the question of impleadment of legal heirs of Mr. Roger Shashoua,
it is noticed that the disputes emanate from the SHA wherein the issue is
regarding ITEC and its shareholding. The pattern of shareholding is
recorded in the Arbitral Awards at different times. In the first partial award
arising out of the ICC arbitration dated 12th February, 2007, it is recorded in
paragraph 2 as under:
"2. The First to Third Claimants ("Mr Shashoua",
"Rodemadan" and "Stancroft" respectively) and the
First and Second Respondents ("Mr Sharma and
"ITE India" respectively) are or were shareholders
in ITEC. The basic shareholding structure,
important to an understanding of the background to
the issues between the parties, has been as follows:
O.M.P. (COMM) 88/2020 & O.M.P. (EFA)(COMM) 3/2018 Page 5 of 15
Signature Not Verified
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By:DHIRENDER KUMAR
Signing Date:08.02.2022
09:06:40
(1) Following the initial re-organisation of
ITEC's share capital, Mr. Shashoua and Mr Sharma
each became the holder of 1.5 million of the 3 million
issued 10 Rupee shares in ITEC.
(2) In 2000 Mr. Shashoua transferred all his
shares to Rodemadan, his nominee company. At
about the same time, Mr Sharma transferred 1
million of his shares to his nominee company, ITE
India.
(3) A further restructuring of ITEC's share
capital took place in 2003. 5 million additional 10
rupee shares were issued. 500,000 to Rodemadan, 2
million to Stancroft and 2.5 million to ITE India.
Stancroft is an investment vehicle of Mr Nicholas
Berry, introduced into the affairs of ITEC by Mr
Shashoua.
(4) The result was, and remains, that
Rodemadan and Stancroft between them hold half
ITEC's issued share capital. Mr Sharma and ITE
India hold the other half."
13. A similar position has also been recorded in the award dated 5th
January, 2010 as under:
"1.19 The Claimants and the First and Second
Respondents are, or were, shareholders in the Third
Respondent, ITEC. The basic shareholding structure
was set out in the Tribunal's Partial Award on
Jurisdiction, but is worth repeating. It was as
follows:
(1) Following the initial re-organisation of
ITEC's share capital, Mr. Shashoua and Mr Sharma
O.M.P. (COMM) 88/2020 & O.M.P. (EFA)(COMM) 3/2018 Page 6 of 15
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Digitally Signed
By:DHIRENDER KUMAR
Signing Date:08.02.2022
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each became the holder of 1.5 million of the 3 million
issued 10 Rupee shares in ITEC.
(2) In 2000 Mr Shashoua transferred all his
shares to Rodemadan, his nominee company. At
about the same time, Mr Sharma transferred 1
million of his shares to his nominee company, ITE
India.
(3) A further restructuring of ITEC's share capital
took place in 2003. 5 million additional 10 rupee
shares were issued. 500,000 to Rodemadan, 2
million to Stancroft and 2.5 million to ITE India.
Stancroft is an investment vehicle of Mr Nicholas
Berry, who was introduced to ITEC by Mr Shashoua.
(4) The result was, and remains, that Rodemadan
and Stancroft between them hold 50% of ITEC's
issued share capital, with Mr Sharma and ITE India
holding the other 50%."
14. Petitioner No.1 may have been the original signatory and party in
these proceedings. However, that by itself would not mean that his legal
representatives need to be impleaded. The crux of the dispute is in the
shareholding of ITEC, 50% of which was initially with Mr. Roger Shashoua
and now is with Rodemadan and Stancroft, post the transfer, which has been
recorded and mentioned in the interim awards as set out above. Since 50%
shareholding in ITEC, now vests in Rodemadan and Stancroft, the right to
sue survives in favour of the existing Petitioners and this Court is of the
opinion that the impleadment of legal heirs of Mr. Roger Shashoua would
not be required in view of the facts set out clearly in the Arbitral Awards.
15. It is also relevant to note that the Arbitral Awards are in favour of all
O.M.P. (COMM) 88/2020 & O.M.P. (EFA)(COMM) 3/2018 Page 7 of 15
Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:08.02.2022
09:06:40
the Petitioners- identified as Claimants therein- which further confirms the
fact that the right to sue did accrue and survives in favour of Rodemadan
and Stancroft. The relevant extract of the award dated 5th January, 2010 is as
under:
"12. SUMMARY OF FINDINGS- AWARD
12.1 For all of the foregoing reasons, and rejecting
all submissions to the contrary, the Tribunal
HEREBY FINDS DECLARES AND AWARDS as
follows:
(a) In accordance with paragraphs 9.5 - 9.13 of
this Award, the First Respondent shall transfer or
cause to be transferred to the Claimants all shares
held by him in the Third Respondent.
(b) Also in accordance with paragraphs 9.5 -
9.13 of this Award, the First Respondent shall
ensure the transfer to the Claimants of all shares
held by the First Respondent's nominee/s in the
Third Respondent.
(c) In accordance with paragraph 9.36 (a) of this
Award the transfer of the shares directed in 12.1
(a) and (b) above shall take place by way of the
delivery of the original share certificates for 4
million shares in the Third Respondent, together
with duly signed transfer deeds executed on behalf
of the First and Second Respondents in favour of
the Second and Third Claimants (2 million shares
each). The First Respondent shall deposit these
shares and transfer deeds with his Indian solicitor,
Mr. Satinder Kapur, within four weeks of
publication of this Award. Written notice of such
deposit must be given by the First Respondent to
the Claimants' Indian solicitors, Amarchand &
Mangaldas & Suresh Shroff & Co.
(d) In accordance with paragraphs 9.15 - 9.24 of
this Award, the First Respondent shall in respect of
1.5 million of the shares be entitled to receive the
O.M.P. (COMM) 88/2020 & O.M.P. (EFA)(COMM) 3/2018 Page 8 of 15
Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:08.02.2022
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sum of Rs. 144,283,500 from the Claimants.
(e) Also in accordance with paragraphs 9.15 -
9.24 of this Award, the First Respondent or his
nominee/s shall in respect of the balance of the
shares be entitled to recover from the Claimants a
sum equal to the par value of the shares, being
their paid-up value as recorded in the books of the
Third Respondent, less Rs.16.29 million."
...
(u) The First Respondent shall pay the sum of
£1,242,395 to any one of the Claimants within 21
days of the date of this Award. Such payment will
constitute a discharge of the First Respondent as
against all Claimants.
(v) In accordance with paragraphs 11.40 - 11.52
and 11.54 - 11.58 of this Award the Claimants are
also entitled to recover from the First Respondent
the sum of US$ 140,000 in respect of the initial
advance on costs, together with interest at the rate
of 8% per annum from 2 May 2007 until the date of
payment, such interest to be compounded on a
quarterly basis.
(w) In accordance with paragraphs 11.40 - 11.52
and 11.59 - 11.60 of this Award the Claimants are
also entitled to recover from the First Respondent
the sum of US$ 60,000 in respect of the second
advance on costs.
(x) In accordance with paragraphs 9.26, 9.33,
9.34, 9.35, 9.39 and 9.40 of this Award, no other
relief sought by the Claimants against the First
and/or Third Respondents is granted."
16. Similarly, the relevant extract of the award dated 1st August, 2011 is
as under:
"9.1 For all of the foregoing reasons, and
rejecting all submissions to the contrary, the
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By:DHIRENDER KUMAR
Signing Date:08.02.2022
09:06:40
Tribunal hereby finds declares and awards as
follows:
(a) In accordance with paragraph 6.1 and 6.11 of
this Award, the objections of the Second
Respondent as to jurisdiction are dismissed.
(b) To the extent that such has not already
occurred, the Second Respondent shall
transfer or cause to be transferred to the
Claimants all share held by it in the Third
Respondent.
(c) In accordance with paragraph 7.8 of this
Award the transfer of the shares directed 9.1
(b) above shall take place by way of the
delivery of the original share certificates for
all shares held by the Second Respondent in
the Third Respondent, together with duly
signed transfer deeds executed on behalf of
the Second Respondent in favour of the
Second and Third Claimants in equal share.
The Second Respondent shall deposit these
shares and transfer deeds with the Claimants'
Indian solicitors, Amarchand & Mangaldas &
Suresh Shroff & Co., within four weeks of
publication of this Award.
(d) In accordance with paragraph 7.7 of this
Award, the Second Respondent shall, in
respect of those of the initial batch of 1.5
million shares that it holds, be entitled to
receive the sum of Rs.96.189 per share from
the Claimants.
(e) Also in accordance with paragraph 7.7 of this
Award, the Second Respondent shall in
respect of the balance of the shares in Third
Respondent (2.5 million shares) be entitled to
recover from the Claimants a sum equal to
the par value of the shares, being their paid-
up value as recorded in the books of the Third
Respondent, less Rs.16.29 million.
Signature Not Verified
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By:DHIRENDER KUMAR
Signing Date:08.02.2022
09:06:40
(f) In accordance with paragraph 7.8 of this
Award the Claimants shall, within two weeks
of receipt of confirmation of the transfer of
shares as directed at paragraph 9.7 (b)
above, deposit with their solicitors
Amarchand & Mangaldas & Suresh Shroff &
Co., or any other solicitors nominated by the
Claimants, the entire sum payable towards
these shares as directed by the Tribunal at
paragraph 9.1(d) and (e) above. The party
with whom the deposit was made shall with in
7 days of receipt of the funds advise the
Second Respondent in writing that the funds
have been received.
(g) Upon the giving of notice to the Second
Respondent that the funds have been received
in accordance with paragraph 9.1 (f) above,
the Claimants' nominated solicitors will be
entitled to forthwith deliver unconditionally
all the shares certificate and deeds of transfer
to the Claimants.
(h) Until such time as the transfer of the shares
referred to in 9.1 (b) above has occurred, the
Second Respondent is prohibited and
injuncted from dealing with, alienating,
encumbering or otherwise disposing of any
interest in said shares that are registered in
its name, or in which it has any interest, in
accordance with paragraph 7.8 (iv) and 7.17
of this Award.
(i) In accordance with paragraph 7.18 of this
Award, the Second Respondent shall do all
acts, execute all necessary documents, and
cooperate fully in giving effect to the from
and substance of all relief granted by the
Tribunal, whether by the passing, reversal or
revocation of any resolution of the
shareholders or the directors, or by the filing
Signature Not Verified
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By:DHIRENDER KUMAR
Signing Date:08.02.2022
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of documents, or by the procuring of others to
act or otherwise howsoever.
(j) In accordance with paragraph 8.16 and 8.48
of this Award the Second Respondent shall
pay the sum of £41,077.47, in respect of the
Claimants' legal costs, expert witness and
other expenses incurred in connection with
these arbitral proceedings as they related
exclusively to the Second Respondent, to any
one of the Claimants with in 21 days of the
date of this Award. Such payment will
constitute a discharge of the Second
Respondent as against all Claimants for this
sum.
(k) In accordance with paragraph 8.33 and 8.47
of this Award the Second Respondent shall the
sum of £414,131.67 in respect of the
Claimants' legal costs, expert witness
expenses and other expenses incurred in
connection with these arbitral proceedings, to
any one of the Claimants within 21 days of the
date of this Award. Such payment will
constitute a discharge of the Second
Respondent as against all Claimants for this
sum.
(l) In accordance with paragraph 8.41, 8.42 and
8.46 of this Award the Second Respondent,
jointly and severally with the First
Respondent, shall pay the Claimants the sum
of US$140,000 in respect of the initial
advance on costs, together with interest on
that sum at the rate of 8% per annum from 2
May 2007 until the date of payment, such
interest to be compounded at 2 May 2007 and
thereafter on quarterly basis. Payment to any
one of the Claimants will constitute a
discharge of the Second Respondent as
against all Claimants for this sum.
Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:08.02.2022
09:06:40
(m) In accordance with paragraph 8.41, 8.43 and
8.46 of this Award the Second Respondent,
jointly, and severally with the First
Respondent, is to pay to the Claimants the
sum of US$410,000, being the costs of the
arbitration as set by the ICC Court less the
amount awarded at 9.1(1) above. Payment to
any one of the Claimants will constitute a
discharge of the Second Respondent as
against all Claimants for this sum."
17. As per the Petitioners, Mr. Roger Shashoua was a party to these
proceedings as he had personal knowledge of a number of facts. In the
opinion of this Court the fact that Petitioner No.1 was a party would not
automatically lead to the inference that his legal representatives would have
to be compulsorily impleaded upon his demise. The provisions of Order
XXII CPC are clear to the effect that if the right to sue survives, there would
be no abatement of the proceedings. In the present case the right to sue
clearly survives in favour of Rodemadan and Stancroft. This is due to the
fact that 50% of the shareholding of Petitioner No.1 vests in favour of
Rodemadan and Stancroft, as also the fact that the Arbitral Awards are in
favour of all Petitioners. Therefore, this Court is of the opinion that there is
no requirement for impleadment of the legal heirs of the deceased Petitioner
No.1. Moreover, directing impleadment at this stage, in these facts would
lead to further delay in adjudication of foreign awards which are more than
ten years old.
18. Mr. Sibal, ld. counsel, now submits that there was no assignment of
rights in this case by Petitioner No.1, however, there is only a transfer of
shares. He seeks to distinguish between the two terms and submits that
"transfer of shares" would not be the same as "assignment of all rights".
Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:08.02.2022
09:06:40
19. In any event, since objections have also been filed by the Respondents
in respect of the Arbitral Awards of which enforcement is sought, if at a
later stage, the Court comes to the conclusion that there are any personal
rights of Petitioner No.1, apart from the rights transferred to Rodemadan and
Stancroft, and the legal heirs of Petitioner No.1 may be required to be
impleaded, at that stage, after detailed examination of the arbitral awards,
appropriate orders, in accordance with law, would be passed.
20. Accordingly, the death certificate of Mr. Roger Shashoua is taken on
record. Petitioner No.1 is, deleted in the above terms. The amended memos
of parties are taken on record.
21. Both these applications are disposed of, in these terms.
I.A.16585/2010 in O.M.P. (COMM) 88/2020
22. It is submitted by Mr. Deepak Kumar Vijay, ld. Counsel for ITEC,
that this application has become infructuous.
23. Accordingly, the present application is disposed of as infructuous.
O.M.P. (COMM) 88/2020 & I.As.16586/2010, 903/2014, 12734/2017,
13271/2017, 13273/2017 & 13341/2021
O.M.P. (EFA)(COMM) 3/2018 & I.As. 5000/2018, 8544/2018
24. Submissions have been heard in part on behalf of the Respondents in
respect of their objections under Section 48 of the A&C Act.
25. It is also submitted by the Petitioners that the costs payable by the
Respondents to the Petitioners, as per the previous order dated 11th January,
2022, have not been paid.
26. Let the costs be paid now within two weeks, in the names of the
counsels for the Petitioners, after ascertaining the exact details from the said
counsel.
Signature Not Verified
Digitally Signed
By:DHIRENDER KUMAR
Signing Date:08.02.2022
09:06:40
27. List for further hearing on 14th March, 2022 and thereafter on 21st
March, 2022, at 2.30 p.m.
28. These are part-heard matters.
PRATHIBA M. SINGH
JUDGE
FEBRUARY 2, 2022
Dk/dj/mw/ms
(corrected & released on 7th February, 2022)
