Bombay High Court
Nimesh Jivanlal Shah vs Kamlesh Jivanlal Shah And Anr on 4 February, 2020
Equivalent citations: AIRONLINE 2020 BOM 1269
Author: G. S. Patel
Bench: G.S. Patel
905-ARBP170-20.DOC
Shephali
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
ARBITRATION PETITION NO. 170 OF 2020
Nimesh Jivanlal Shah ...Petitioner
Versus
Kamlesh Jivanlal Shah & Anr ...Respondents
Dr Birendra Saraf, i/b Kishore Shriyan, MM Shah, Amod Mulye &
Bhavika T, i/b MST Legal, for the Petitioner.
Ms SI Joshi, with Ms Nikita Pawar, i/b SI Joshi & Co., for Respondent
No. 1.
Mr Mohammed Akram Bastivi, for Respondent No. 2.
CORAM: G.S. PATEL, J.
DATED: 4th February 2020 PC:-
1. This petition under Section 37 of the Arbitration and Conciliation Act 1996 challenges an arbitral order of 12th January 2020. That order covers very many issues. I heard Dr Saraf for the Petitioner, Ms Joshi for the 1st Respondent and Mr Bastivi for the 2nd Respondent.
2. This is a family dispute. At my suggestion and after some negotiations, parties have agreed on some terms that will settle not only this dispute presently in arbitration, thereby ending the arbitration itself and dispose of the Section 37 Petition, but will also Page 1 of 9 4th February 2020 ::: Uploaded on - 06/02/2020 ::: Downloaded on - 06/02/2020 20:59:12 ::: 905-ARBP170-20.DOC dispose of a pending Testamentary Suit No. 80 of 2017. Obviously, I cannot make an order on testamentary proceedings since these matters are not assigned to me but it is agreed that the parties will obtain an appropriate order from the testamentary Court on the basis of the present order. Moreover, all three parties have requested me to note that this order completely and wholly settles all disputes between them and none has any surviving claim against the other.
3. I have not assessed the merits of the Petition and this order is by consent.
4. In order to understand the proposal and to put it in to perspective, a few facts are necessary. The Petitioner, Nimesh, and the 1st Respondent, Kamlesh, are brothers. They are the sons of Leela Jivanlal Shah, the 2nd Respondent, today about 85 years old. Leelaben's husband Jivanlal died on 8th February 2016. During his lifetime, he had an analytic lab business under the name 'Nikasu Labs'. This was run as a partnership frm. Jivanlal was a partner along with his two sons. There is some controversy about the dissolution of the frm.
5. These are the assets in dispute in the family.
(a) A residential Flat No. 76/18, Second Floor, Panchasar Building, F-Road, Marine Drive, Mumbai 400 020.
Kamlesh is in exclusive possession of this fat. Nimesh and Leelaben claim a share in this fat.
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(b) Another residential fat 89, Sahakar Niwas, 3rd Floor, 20 Tardeo Road, Haji Ali, Mumbai 400 020. This is exclusively occupied by Nimesh.
(c) Leelaben is supposedly living with Kamlesh but her Advocate, Mr Bastivi, says that she is being supported by her other son, Nimesh. We will not be required to enter into this controversy in view of the following order.
(d) Then there are two commercial premises, namely 41, Eastern Chambers Building, 5th Floor, Nandlal Jani Road, Dana Bunder, Masjid Bunder (East), Mumbai 400 007 of about 330 sq ft. The Nikasu Lab business is being carried on from this unit, which means that there is specialized lab equipment (apart from other ancillary movables) in this unit. The second commercial unit is Unit 47 at the same address at Masjid Bunder (East). It is 385 sq ft. It is being used as an administrative ofce and has the usual administrative ofce fttings, furnishings etc.
6. The agreement between the parties is as follows:
(a) Nimesh and Leelaben today before me entirely and irrevocably relinquish all claims to any share, right, title and interest, whether divided or undivided, in the Marine Drive fat and do so in perpetuity in favour of Kamlesh.
(b) For his part, Kamlesh similarly gives up any right, title, interest, or share that he may claim in the Tardeo fat Page 3 of 9 4th February 2020 ::: Uploaded on - 06/02/2020 ::: Downloaded on - 06/02/2020 20:59:12 ::: 905-ARBP170-20.DOC and also irrevocably gives up any challenge to the Deed of Gift by which Nimesh says that fat came to him in Jivanlal's lifetime. Leelaben Shah also gives up all claims to the Tardeo fat.
(c) At this stage both sides agree that in lieu of Leelaben giving up her claims in respect of both fats and out of natural love and afection, Leelaben will continue to have a life interest for her residence at both fats at her choice and neither Kamlesh nor Nimesh will refuse her free entry or accommodation in to either of these fats.
(d) There is a Central Bank fxed deposit in the name of Nikasu Lab in the amount of Rs. 22 lakhs approximately and a current account in the name of the frm, which has an estimated balance of about Rs. 25 lakhs.
(i) Both sides agree that this entire amount as also any other amount that may be in the late Jivanlal's estate will be retained for Leelaben Shah's exclusive use, beneft, maintenance, medical treatment and personal expenses during her lifetime. The case papers indicate that she has already been diagnosed with cancer and requires treatment. She is at liberty to use any or all of this fund as she deems ft.
(ii) For this purpose, the Fixed Deposit in the name of the frm will be closed and encashed and a new Fixed Deposit on optimal terms Page 4 of 9 4th February 2020 ::: Uploaded on - 06/02/2020 ::: Downloaded on - 06/02/2020 20:59:12 ::: 905-ARBP170-20.DOC will be opened with the Central Bank of India in Leelaben's sole name. Nimesh and Kamlesh will be joined as nominees to that FD account (in order of their age).
(iii) The current account will be closed and the amount transferred to a savings bank account in Leelaben's sole name. Nimesh and Kamlesh will be joined as nominees to that FD account (in order of their age).
(iv) The operating instructions are to be of Leelaben alone.
(v) The mandate to the bank will NOT include electronic banking or net banking facilities.
(vi) The balance of the FD account and the Savings Bank account on her demise, if there is any, is to be divided equally between her sons, Nimesh and Kamlesh.
(vii) During her lifetime, neither of the sons will make any sort of claim on these funds nor ask her to render any account for such use she may make of all or any of these funds.
(e) As regards the ofce premises, Unit No. 41, which is the lab, will belong to Kamlesh exclusively. He will be the owner of those premises along with all fttings, furniture, plant and machinery within that unit.
Nimesh gives up all share, right, title and interest in Unit No.41.
Page 5 of 94th February 2020 ::: Uploaded on - 06/02/2020 ::: Downloaded on - 06/02/2020 20:59:12 ::: 905-ARBP170-20.DOC (f ) Reciprocally, Kamlesh gives up all right, title and claim to the ofce Unit No. 47. He is, however, entitled to remove his computers, fles, records and other equipment from Unit No. 47. What is to be left behind in Unit No. 47 is the basic furniture, fxtures, electrical fttings, fans, air conditioners and so on.
(g) Unit No. 47 will belong to Nimesh exclusively. He will not make any claim in respect of Unit No. 41.
(h) Each brother consequently relinquishes and gives up all share, right, title and claim in perpetuity against the other unit.
7. In consideration of the provisions made for her, Leelaben Shah through Mr Bastivi agrees to give up all her right, title and interest in these two units as well.
8. It is clarifed that this arrangement in the family is not in any way linked to any testamentary or intestate disposition, including in particular in regard to the provisions of Section 14(2) of the Hindu Succession Act.
9. There remains the question of the Nikasu Lab business. Both Nimesh and Kamlesh seek the right to carry on that business in that name. It is not possible to allow both of them to run more or less the same business with the same name, Nikasu Labs, forever.
(a) It is, therefore, agreed that both brothers, Nimesh and Kamlesh, will be entitled to use the name Nikasu in conjunction -- and only in conjunction -- with either Page 6 of 9 4th February 2020 ::: Uploaded on - 06/02/2020 ::: Downloaded on - 06/02/2020 20:59:12 ::: 905-ARBP170-20.DOC their frst names or with some other mark or name, but not to use the word 'Nikasu' on its own, i.e. only in conjunction with another word or expression. The two words will be of equal prominence in terms of size, shape, depiction, font and colour.
(b) They will jointly use this Nikasu in conjunction with another expression in this fashion only for a period of 24 months from today. At the end of that period, both of them will completely and permanently cease use of the Nikasu name and brand wholly even in conjunction with another mark, word or expression.
This need for this transitional provision is to give each brother sufcient time to develop and evolve his own individual business identity, brand or mark.
10. There is a question of the necessary regulatory and trade licenses. Those licenses presently stand in the name of Nikasu Labs. On the basis of this order, and on production of an authenticated copy of this order, Kamlesh shall apply to the authorities concerned for a transfer of the licenses that he currently holds to the name of his business, i.e. a business with another word, mark, or expression used in conjunction (for example 'Kamlesh Nikasu' or something similar). Similarly, Nimesh will be entitled to apply for a license in the name of his own business with the conjoint name as mentioned above or a wholly new mark, brand or name. Neither brother will object to the other applying for a license in this fashion and any consent required for obtaining such a license is unequivocally given by one brother to the other in this order and is noted today.
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11. Kamlesh agrees and undertakes that he will vacate Unit No. 47 in the Masjid Bunder premises within a period of six weeks from today and hand over possession to Nimesh. The private Receiver previously appointed will stand discharged without passing accounts but on payment of his reasonable costs, charges and expenses within a period of three weeks from today by the Petitioner, Nimesh. The Receiver will immediately hand over possession to Mr Kamlesh Shah. He will act on production of an authenticated copy of this order.
12. As regards the partnership frm, the parties agree that it stands dissolved. Ms Joshi's client, the 1st Respondent Kamlesh, has already tendered accounts to the learned Sole Arbitrator. These are accepted. Those accounts show the current account balance with the Central Bank of India for Rs. 25 lakhs, and there is the Fixed Deposit mentioned above. Both have already been provided for by consent in the foregoing order.
13. The three parties agree that this order by consent ends all disputes, diferences and claims one against the other. None of the parties will have any outstanding complaint against any other from this point on.
14. The parties also agree that this order will serve as an order that records an oral family arrangement arrived at between the parties in Court today.
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15. Parties are at liberty to submit an authenticated copy of this order to the authorities concerned should any question of stamp or registration arise.
16. The mandate of the learned sole Arbitrator stands terminated in view of this consent order. The arbitration proceedings are closed without any fnal determination.
17. Parties agree that they will make an application to the testamentary Court within the next ten days for a disposal in these terms of Testamentary Suit No. 80 of 2017. There will be no claim by any party against any other whether by way of testamentary disposition or inheritance.
18. All three parties are present in Court today when this order is passed.
(G. S. PATEL, J) Page 9 of 9 4th February 2020 ::: Uploaded on - 06/02/2020 ::: Downloaded on - 06/02/2020 20:59:12 :::