Delhi High Court
Gurnir Singh Gill And Another vs Saz International P. Ltd. And Others on 12 December, 1985
Equivalent citations: [1987]62ITR197(DELHI)
Author: S. Ranganathan
Bench: S. Ranganathan
JUDGMENT S. Ranganathan, J.
1. These are interim applications in C.P. No. 35 of 1985. The company petition has been filed by Sri G. S. Gill and his mother, Surjit Kaur (who are hereinafter referred to as P-1 and P-2, respectively), under sections 397 and 398 of the Companies Act, 1956, in respect of the affairs of a company known as Saz International Pvt. Ltd." (hereinafter referred to as "the company" which is the first respondent in the petition). But the three real respondents against whom acts of oppression and mismanagement are alleged are the following :
Respondent No. 2(R-2) : Mrs. Adarsh Kaur Gill, the sister of P-2.
Respondent No. 3(R-3) : Mr. G. C. Mittal, a friend of the family and an advocate by profession.
Respondent No. 4 (R-4) : Mrs. Noorien Kaur Gill Nanlaer, the daughter of R-2.
2. The two sisters, Surjit and Adarsh (P-2 and R-2), migrated from India several years ago. They are said to have married two brothers in Panama, Central America, and thereafter continued to live together in the USA and India. P-1 was born to P-2 and was foreign national. So also R-4 (the daughter of R-2) who married a Belgian and eventually settled down in Belgium was a foreign national. It appears that P-2 and R-2 went to America in 1968 for obtaining divorce from their husbands and, during the pendency of the litigation, conceived the idea of starting a business of purchasing ladies' garments from India and marketing them abroad. They were apparently successful and started carrying on business abroad in several names purchasing raw materials and garments from various parties in India.
3. It was not long before the idea of starting an organisation in India occurred to the parties. On January 24, 1976, was formed the company, Saz, International Pvt. Ltd. The authorised share capital of the company was kept at Rs. 10 lakhs, consisting of 10,000 shares of Rs. 100 each but to start with, the company had two shares of Rs. 100 each, one held by Smt. Rashmi Puri (wife of a chartered accountant) and one by a nephew of P-2 and R-2, Shri K. K. Bindal. There were two directors, Mrs, Puri and P-2. Soon after, P-1 acquired Indian citizenship by registration and it was apparently decided that he should permanently stay in India and look after the Indian end of the business. 2,498 shares were said to have been allotted to him on September 15, 1978, (Rs. 30 being paid up against each shares) and he and R-3 were made directors. No shares, however, could be, or were, allotted to P-2, R-2 and R-4 who were all non-resident Indians and approval of the Reserve Bank of India was necessary for allotment of shares in
4. It is common ground that, in the meanwhile, resolution were passed by the board of directors in 1980, 1981 and 1982 that shares should be allotted to the non-residents P-2, R-2 and R-4 and that steps should be taken to obtain the approval of the Reserve Bank of India for this purpose. But there is a dispute as to how these shares were to be allotted. It seems that P-1 applied on August 20, 1983, to the Reserve Bank of India in the prescribed form for approval of allotment of 1, 900 shares to P-2, 2,500 shares to R-2 and 940 shares to R-4. According to the respondents, however, a resolution had been passed on October 13, 1983, approving the issue of 2,500 shares to P-2, 4,060 shares to R-2 and 940 shares to R-4, thus making up the entire authorised shares of 10,000 shares but this is deputed by the petitioners. Whatever the position, on November 7, 1984, the Reserve Bank of india granted its approval to the allotment of 1,423 shares to P-2, 1,216 shares to R-2 and 940 shares to R-4, perhaps proportionately to
5. It appears that quarrels had developed between P-2 and R-2 in regard to the business in the USA P-2 instituted a suit against R-2 in New York alleging mismanagement and misappropriation in the case of a firm called SAZ in which they were both partners. This action also had repercussions on the Indian scene. This firm was the primary outlet for the company's goods and, with the institution of this suit, the company suffered a severe set back and it is claimed by the petitioners that, after some of the events to be presently referred to, the respondent company has received absolutely no orders for purchases. Since the Indian company was under the control of P-1 as the managing director, the respondents had to do something to consolidate their position in relation to the affairs of the company. Thus, the events abroad also cast their shadow on the Indian scene. According to the petitioners, the respondents moved fast, on and from December 28, 1984, taking steps one after the other calculated to deprive the petit
6. December 8, 1984 : A meeting of the board of directors was purportedly held and 4,060 shares (2,844 over and above the number approved by the Reserve Bank of India were allotted to R-2, 2,500 shares (1,077 over and above the number approved by the Reserve Bank of India) to P-2 and 940 shares to R-4.
7. January 1, 1985 : At a meeting of the board of directors said to have been held on this date, R-1 was appointed an additional director of the company.
8. January 31, 1985 : At another meeting of the board said to have been held on this date, R-2 was appointed the managing director of the company with extensive powers of borrowal, lending and investments.
9. It is said that on December28, 1984, P-1 was away at Agra and Jaipur and that R-2 and R-3 had colluded to take advantage of his absence to purportedly convene a meeting on that date and allot shares as above. It is alleged that though the petitioner returned to Delhi on January 2, 1985, he came to know about these activities of the respondents only on February 2, 1985, when he accidentally came across a copy of two letters addressed by them, one to the staff and one to the Reserve Bank of India. It is further alleged that the respondents, in pursuance of their illegal designs, have, inter alia, removed the company's minutes book, mismanaged the company's affairs, diverted and misappropriated its funds, prevented the petitioners from operating the bank account, refused them access to the factory, failed to pay the labourers, dismissed some of them and lured some away to their private business and thus created chaos in the affairs of the company. These developments, it is said, have constrained the petitioners
10. The petition and an application for certain interim reliefs (CA No. 89 of 1985) came on for hearing before Anand J. on February 15, 1985. The learned judge did not want to deal with the case as the parties were known to him but it was represented to him that both parties were agreeable to an interim consent order. He, therefore, made an order in terms of a joint application filed before him regarding various things to be done -one of the clauses of the consent order (clause5) provided :
"In case of any differences or any grievances between the parties, they shall consult Mr. P. H. Parekh and Mr. Kaura and they shall abide by the unanimous decisions taken by Mr. P. H. Parekh and Mr. Kaura."
11. Mr. Parekh and Mr. Kaura were counsel for the petitioners and respondents respectively. A supplemental consent order was also passed by that were going on between the parties failed and the matter was listed before Khanna, J. Subsequently, there were a number of interim applications filed in the petition, one of which was an application by the petitioners, C.A. No. 279 of 1985, filed on March 27, 1985, stating that talks of compromise had filed and praying that the orders of February 15, 1985, and February 22, 1985, should be revoked and other orders passed to safeguard the interests of the petitioners. After hearing the interim applications on several dates, Khanna J. was of opinion that it was time to take up the main petition for consideration. it was also brought to his notice that the respondents had also filed a petition, C.P. No. 66 of 1985, under sections 397 and 398. He, therefore, directed that replies in the CPs should be filed and that they should be listed on May 22, 1985. At this stage, the pet was not aware, at the time of filing the petition, that even the 1, 423 shares had been allotted to P-2 only on December 28, 1984, but was under the impression that these had been allotted earlier and that the resolution dated December 28, 1984, was only in regard to the allotment of 2,844 shares in favor of R-2. The petitioners, therefore, applied, in CA No. 551 of 1985 for amendment of the petition in this and other respects.
12. On May 22, 1985, the learned judge passed the following order in C.P. No 35 of 1985 :
"The main controversy thus is who are the shareholders of respondent No. 1 company. This has to be determined and in this regard the parties wanted to raise a number of contentions and place such material before the court by way of affidavits or otherwise as they considered appropriate. However, in view of the heavy cause lists these days, it may not be possible to provide full bearing in this regard to the parties before the vacation. The parties, however, seek that the matter is quite urgent and this should be decided early. As such they have sought that the controversy as to the shareholding of respondent No. 1 be referred to Mr. Justice V.S. Deshpande, retired Chief Justice of this court, who should submit his report after permitting the parties to place such material before him as they may consider proper. The report be submitted by July 19, 1985. The determination of the shareholding will naturally involve the going into the holding of the meetings on December 28, 1984, January 1, 1985, and January 31,
13. Then, there are applications moved from the side of different workers of respondent no. 1 company. Mr. Justice Deshpande may also look in to whether any amounts are available for payment to the workers and to report how much should be forthwith disbursed to them." The learned judge also referred to C.P. No. 66 of 1983 but came to the conclusion that the consideration of that petition could be deferred. He also referred to the urgency felt by the parties and, hoping that the proceedings before Shri Deshpande could be concluded by the time the court reopened after the summer recess, fixed July 19, 1985, as the date by which Shri Deshpande's report was to be submitted.
14. The proceedings before Shri Deshpande now need to be referred to. Since there is dispute between the parties as to the nature of the reference made to Shri Deshpande, references will be made to him, hereinafter tentatively as "the commissioner", without prejudice to the contention of the petitioners that he is not a referee or commissioner as contended by the respondents but is an arbitrator appointed by the consent of both parties. On August 27, 1985, the parties appeared before the commissioner. Time was given till June 29, 1985, for the filing of reply and rejoinder in C.A. No. 551 of 1985 and directions were given for the production of the minutes books of meetings of directors and shareholders and for the filing of documents and affidavits of evidence considered necessary. On June 29, 1985, proceedings were adjourned to July 4, 1985, for filing of documents and their admission and denial. On July 4, 1985, the petitioners filed four affidavits and some documents and the respondents filed two affidavits a "......the reference requires me to -
(i) take as undisputed that petitioner No. 1 holds 2,498 shares ;
(ii) to determine the shareholding of all the parties ; and
(iii) to go into the allegations regarding the meeting of December 28, 1984, January 1, 1985, and January 31, 1985, and find on them.
I am not to decide any other thing. Time to give my findings is there till August 19, 1985. Hence, the case is fixed on August 13, 1985, at 5.00 p.m. to allow parties to file counter-affidavits, if any, and address arguments."
15. At this stage, four applications were made in court being C.As. Nos. 743 to 746 of 1985. In C.A. NO. 743 of 1985 filed by the respondents, objection was taken to the order of the Commissioner dated August 7, 1985, as misconstruing the jurisdiction conferred on him by the order dated May 22, 1985, and as arrogating to himself powers and jurisdiction not conferred by the said order. The objection was that the petitioners were seeking to introduce matters extraneous to the reference by filing affidavits and documents "concerning not only the shareholders on the record of respondent No. 1 company and the alleged forgeries of minutes of the board of directors' meetings held on December 28, 1984, January 1, 1985, and January 31, 1985", but also the following, among others :
(i) the legal validity of the above Board meetings ;
(ii) the authenticity and validity of the minutes of the above board meeting ;
(iii) the legal validity of the share allotments made to P-2, R-2, and R-4 ;
(iv) the rectification of shareholders' register so as to delete the shares allotted to P-2, R-2, and R-4.
16. It was prayed that the exact scope of the reference should be clarified and, in the meanwhile, the proceedings before the commissioner stayed. In C.A. No. 744 of 1985, the respondents prayed that C.P. No. 35 of 1985 should be dismissed as not maintainable on certain preliminary grounds raised in the reply to the petition. In C.A. No. 746 of 1985 filed by the respondents, reference was made to an affidavit filed, and it was alleged that, on perusing an affidavit filed by R-3 and obtaining certain clarifications said to have been made by him, had come to know that no Board meetings had been held on September 15, 1978, September 22, 1978, or April 27, 1979, and it was prayed that they should be permitted to amend the reply they had filed in CP No. 35 of 1985, so as to challenge the validity of the allotment of 2,498 shares to P-1 and urging that since P-2 had also disclaimed the allotment of shares to her on December 28, 1984, the petition by them under sections 397 and 398 was not maintainable and liable to di
17. When these applications came up for admission on August 12, 1985, notice was ordered to the non-applicants for August 30, 1985, but no stay of the proceedings before the commissioner was granted. (It seems that an appeal was preferred against the order of refusal of stay but was dismissed). The time for submission of the commissioner's report was, however, extended to September 5, 1985. On August 13, 1985, two more applications were filed by the respondents before the commissioner who disposed of them and directed certain papers and documents to be filed. On the next date, viz., August 22, 1985, parties sought time for certain compliances. On August 27, 1985, counsel for the respondent stated before the commissioner that he will not file his counter-affidavit till his application is decided by the court on August 30, 1985. Counsel for the petitioner stated that his counter-affidavit was ready, but he will not file it except simultaneously and the matter was fixed for arguments on August 31, 1985 and September
18. In the meantime, on August 22, 1985, the respondents filed CA No. 774 of 1985, purporting to be an application under sections 25, 28 and 41 of the Arbitration Act. In this application, it was alleged that, under clause 5 of the consent order dated February 15, 1985, all differences between the parties were to be arbitrated upon by Mr. P.H. Parekh and Mr. Kaura, that the sole arbitrators had entered upon the arbitration and given an interim award on February 22, 1985, but that further proceedings remained incomplete due to the illness of Mr. Parekh. It was prayed that time be enlarged for the making of the award by these two persons. By CA No. 773 of 1985 filed simultaneously, it was prayed that the proceedings in CP No. 35 of 1985, including= those before the commissioner should be stayed till the disposal of Ca No. 774 of 1985. Notice was ordered on these applications for August 30, 1985. On August 30, 1985, all the applications were adjourned to September 9, 1985. The time limit placed for the commissioner
19. This was the stage of affairs when the hearings before the commissioner were taken up. On August 31, 1985, the commissioner disposed of an application filed by Mr. Kaura. He then directed that after September 2, 1985, the case will be heard from day to day. It was clarified that Mr. Kaura would be filing his counter-affidavits subject to court's orders on September 11, 1985, and that the counter- affidavits of the petitioners, which were ready, would also be filed on that date. On September 2, 1985, however, the respondents did not appear before the commissioner. Instead, a letter was received from Mr. Kaura that he had instructions from the respondents not to appear further "in these proceedings". An "application" was also filed by R-2 before him (on behalf of herself and R-4) making allegations of bias against the commissioner and requesting that he should not proceed further with the matter. Shri Deshpande thereupon drew up a report dated September 3, 1985. He referred briefly to the proceedings before hi "I had, therefore, to stop the proceedings and I have to return the papers to the court without determining the questions referred to be by the court inasmuch as the application by the respondent, Mrs. Adarsh Kaur, has alleged bias on my part. Therefore, though the application is made to me, it would not be proper for me to decide it and hence I am submitting, it to this Hon. Court."
20. After having said this, he proceeded to deal with a question that had been raised as to whether he is to act as a commissioner or as an arbitrator in this case. He discussed this issue at some length and expressed the view that he had been appointed as an arbitrator and not as a commissioner. This report was placed before the court on September 9, 1985. In the meantime, the petitioner filed C.A. No. 869 of 1985 praying that the application moved by R-2 before Shri Deshpande be rejected, that appropriate action be taken against R-2 for making false and frivolous allegations against the commissioner and that the records be sent back to Shri Deshpande for completing the proceedings and sending his findings on the main controversy as per the order dated May 22, 1985, within a specified period. This application, in which the reply and rejoinder have been filed, has also come up for arguments.
21. I may at once make it clear that the arguments before me were confined to the scope of the reference to the commissioner and as to whether, in the way the proceedings have gone on, the proceedings before Shri Deshpande should be allowed to continue. An allied question was whether in case the proceedings before Shri Deshpande are to continue, the respondents' application to amend their reply to the petition should be allowed and, if so, whether the controversy, as emerging from the amended pleadings, should also be referred for decision to Shri Deshpande. The other controversies can be taken up after this principal question is decided. i shall, therefore, first confine myself to C.As. Nos. 743, 746 and 869 of 1985 and shall defer the consideration of other applications, except C. As. Nos. 773 and 774 of 1985. So far as these two last applications are concerned, I am clearly of the view that they are not maintainable. The order dated February 15, 1985, does not constitute any reference of disputes between the
22. I may mention that Shri Bhargva, appearing for the petitioners, stated throughout that he does not want to lay much emphasis on the designation or status of Shri Deshpande but only wanted that the parties having agreed that certain questions should be decided by him, the respondents should not be permitted to back out of the situation or to engage in dilatory tactics or to raise frivolous objections to the continuance of the proceedings before Shri Deshpande. However, the respondents were not willing to appear any further before Shri Deshpande, whether he was designated as arbitrator or commissioner. Sri Saharya contended that if Shri Deshpande is to be taken as an arbitrator, the appointment is invalid and Shri Deshpande, any way, cannot be allowed to continue as arbitrator because of his bias and "misconduct". On the other hand, if he is to be taken as a Commissioner, no further proceeding before him were warranted :
(a) as he has already collected all the relevant material and his duty is merely to place them before the court instead of proceeding to hear arguments ;
(b) as the respondents have raised several questions regarding relevance, etc., which a=can be decided only by the court and not by him as commissioner ;
(c) as no useful purpose would be served by sending the matter back to him now since the main purpose of sending the case to him was to expedite the proceedings during the court recess and the court itself can proceed to hear and dispose of the matter on the material collected by him without further delay. In view of this, it is necessary that the controversy raised has to be decided once and for all one way or the other, if only it clear the ground.
23. Turning, therefore, to the nature of the office entrusted to Shri Deshpande, this turns on the interpretation of the order of Khanna J, dated May 22, 1985. The order states with a reference to the undisputed position that P-1 holds 2,498 shares in the company and that the disputes between the parties arose as a result of the meetings alleged to have been held on December 28, 1984, January 1, 1985, and January 31, 1985. Though the petition admitted P-2 as the holder of 1,423 shares, the petitioners had subsequently sought amendment thereof so as to get deletion of this shareholding of P-2 in order to bring their case in consonance with the assertion that no such meeting was held. The learned judge, thus, noted that the main controversy was as to whether P-2, R-2 and R-4 were shareholders in the company. Since this would take a long time for a decision by the court and the parties were anxious that the matter should be heard early, they had sought a reference to Shri Deshpande. On the basis of this agreement, rt" by Shri Deshpande, the tenor and contents of the order and the person to whom the reference was made leave no doubt that the main controversy in the company petition was referred to arbitration by Shri Deshpande. The grant of liberty to parties to place all material before Shri Deshpande, the power given to him to go into the question of forgeries in the account books or minute books and the reference to early decision and determination of the shareholding involving "the going into the holding of the meetings" on the three relevant dates all make it clear beyond doubt that the main controversy in the petition regarding the share holdings of P-2, R-2 and R-4 was referred for decision by Shri Deshpande. Shri Deshpande has also set out in his report dated September 3, 1985, various reasons why his status should be considered as that of an arbitrator and not as a commissioner. I also agree with the reasons given by him for coming to the conclusion that Shri Deshpande has been appointed as an arbitrator to de
24. Shri Saharya, appearing for the respondents, next contended that, if Shri Deshpande had been appointed as an arbitrator by the order if May, 22, 1985, such appointment would be invalid as, according to him, disputes arising in a petition under sections 397 and 398 of the Companies Act cannot be referred to arbitration. He also submitted that the court's power to pass orders under sections 397, 398, 402 and 403 was very wide and plenary and cannot be fettered by the order passed on May 22, 1985. He relied, in this context, on the decisions reported as Surendra Kumar Dhawan v. Vir (R.)[1977] 47 Comp Case 276 (Delhi), Manavendra Chitnis v. Leela Chitnis studios P. Ltd. [1985] 58 Comp Case 113 (Bom) and O.P. Gupta v. Shiv General Finance (P.) Ltd. [1976] DLT 49 ; [1977] 47 Comp Case 279 (Delhi). I am unable to accept the contention of learned counsel. The decisions cited by him do not lay down directly the wide proposition that disputes arising in proceedings under section 397 and section 398 cannot be referred to
25. There was some discussion before me as to whether the language of section 21 of the Arbitration Act was wide enough to warrant the appointment of an arbitrator in a company petition. The word "suit" in section 21 of the Arbitration Act has to be understood in a wide sense and will include appeals, execution proceedings and other proceedings before civil courts which are in the nature of suits and in which civil courts decide dispute between parties of a civil nature. Under rule 6 of the Companies (Court) Rules, 1959, the practice and procedure of the court and the provisions of the Civil Procedure Code, so far as applicable, shall apply to all proceedings under the Act and the rules unless excluded by the Act or Rules. These are, therefore, civil proceedings before a court and issues arising there from can be referred to arbitration. Nor is there anything in the nature of the proceedings here that precludes a reference to arbitration. These are not proceedings in rem, like insolvency proceedings, nor do they i
26. In view of my conclusion that the appointment of Shri Deshpande is as an arbitrator, it is necessary to touch upon the allegations of bias and misconduct made by the respondents. I have no hesitation in coming to the conclusion that there is no basis whatsoever in these allegations. The proceedings before Shri Deshpande were going on quite smoothly in the initial stages. The petitioner's allegation is that the respondents were co-operating with, and acquiescing in the jurisdiction of, the arbitrator till, at one stage, the arbitrator asked them to show that proper and valid notice had been issued for convening the meeting on December 28, 1984. According to them, from that point of time, the respondents have been trying various methods to stop, or at least delay, the proceedings before the arbitrator. It is unnecessary to go into this allegation. It is sufficient to say that the arbitrator's decision to consider the validity of thee meeting cannot justify an inference of bias or a conclusion that the arbitrator
27. Turning to C.A. No. 743 of 1985, I am unable to see how the arbitrator has transgressed his jurisdiction. I am not persuaded that any of the matters referred to in the application constituted matters extraneous to the deciding the exact extent of the shares allotted to P-2, R-2 and R-4 at the three meetings in question. In doing so, he is concerned not only with the factual aspects of the allotment but also the legal aspects. He is, therefore, at complete liberty to examine such legal and factual aspects as he may consider necessary for giving a finding on the issues referred to him. I, however, agree with Sri Saharya that items (iv) and (v) referred to in the application are outside the purview of the arbitration. The question whether the approvals given by the Reserve Bank of India were valid or not is an issue extraneous to the Controversy between the parties which turned only on the validity of the three impugned meetings, the proceedings and decisions arrived thereat. So also, the petition before the co
28. This brings me to C.A. No. 746 of 1985. Here an attempt has been made by the respondents to question the validity of the allotment of shares to P-1 in 1978. Sri Bhargava objects to this prayer for amendment on three grounds :
(1) that it is inconsistent with the clear and unequivocal admission in the reply to the petition that P-1 held, 2,498 shares in the company and an amendment having the effect of withdrawing an admission should not be allowed ;
(2) that this travels outside the scope of the controversy raised in the petition which relates only to events after 1984 ; and (3) that the respondent's cause of action to challenge the 1978 and 1979 meetings is now barred by limitation and should not, therefore, be allowed to be adjudicated upon now. Sri Saharya submits that these objections are not tenable not only for the reason that the powers of the court to grant amendments of pleadings, particularly at initial stages, is very wide, but also because the petitioners themselves have sought an amendment of the petition seeking to withdraw an admission regarding an allotment made to P-1 on December 28, 1984, and this aspect has been referred to Shri Deshpande by Khanna J. I am inclined to accept the contention of Sri Saharya. It is true that there is a slight difference between the amendment sought by the petitioners and that sought by the respondents. In the original petition, the petitioners had challenged in clear terms the genuineness and validity of the meetings said to have been held on December 28, 1984, but, overlooking that P-2 had been allotted shares only at that meeting
(i) The petition is still at thee initial stages of hearing and courts are generally very liberal in allowing amendments at these stages when no real prejudice is caused to the other side and when the amendment will only enable the determination of all the questions of controversy between the parties ;
(ii) The contention sought to be now raised will have an impact on the maintainability of the petition and such a plea can be allowed to be raised even somewhat belatedly. In this context it should be pointed out that, in view of the admission now sought to be made by the petitioners that P-2 held no shares in the company on the date of the petition, the plea that P-1 also validly held no shares on that date would be an objection going to the root of the matter regarding the maintainability of the petition ;
(iii) When the petitioners have been allowed a crucial part of their pleadings, it will be inequitable to deny a similar concession to the respondents. In this context, I may mention that though Khanna J. has not passed any specific orders in CA. No. 551 of 1965, a perusal of his order clearly shows that he has referred for arbitration also the question regarding the shareholding of P-2. In other words, CA No. 551 of 1985 has been allowed by him to this extent.
29. The plea of limitation is not of much avail as the amendment is being sought by the respondents in the petition and not by the petitioners and is being taken by way of objection to the maintainability of the petition. I do not, therefore,. think that this is a hurdle in the way of the amendment, which I think is called for, being allowed. A plea of mala fide on the part of the respondents has also been taken but I see no substance in this contention. I, therefore, allow CA. No. 746 of 1985, but having regard to the circumstances, I allow the amendment subject to the payment, by the respondents, of the costs of the petitioner :- Rs. 500.
30. Now arises a procedural difficulty. The reference to arbitration has already been made on the basis of the pleadings as on the date of the order of reference. The amendment which is now being allowed will not, therefore, form part of the reference. It could be included therein only by consent of both parties, failing which it can only be decided upon by this court. In fact, during the hearing of these applications, I suggested that both parties may agree to Shri Deshpande as an arbitrator on all issues including this one. Counsel for the respondents was agreeable to this course but counsel for the petitioners sought a decision in CA. no. 746 of 1985. I have, therefore, given my decision on this application. However, in the circumstances, I direct that when the proceedings are resumed before Shri Deshpande, the petitioners and the respondents should be asked to state in writing, within a time to be specified by him whether they agree to his deciding this issue about the allotment of shares to P-1 and the cal
31. For the reasons discussed above, the applications are disposed of as follows :
(i) CA No. 279 of 1985 : Prayer (a) is rejected. The application will come up for hearing in respect of other prayers on February 3, 1986.
(ii) CA No. 551 of 1985. The scope of Khanna J.'s order has been explained as having allowed the amendment regarding the shareholding of P-2. For hearing regarding the other amendments prayed for, the application may be listed on February 3, 1986.
(iii) CA No. 743 of 1985 : Allowed in part as discussed above.
(iv) CA No. 744 of 1985 : Dismissed.
(v) Case Nos. 745 amd 746 of 1985 : Allowed as discussed above.
(vi) Case Nos. 773 and 774 of 1985 : Dismissed.
(vii) Ca No. 869 of 1985 : Allowed as discussed above.
32. The result is that the proceedings before Shri Deshpande will now be resumed from the stage where they were left earlier. It is clarified that Shri Deshpande will proceed as an arbitrator and file his award in court within four months of the date on which he resumes proceedings. The parties may report before him for necessary directions on January 20, 1986, at 5.00 p,m. or such later date and time as may be intimated by him. A copy of this order deceit may be sent to Shri Deshpande along with the files and reports received from