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It was next contended that the appellant was also an equity shareholder and so far as the other equity shareholders were concerned they constitute the same class as the appellant. That there was no inter se conflict between the rest of the equity shareholders representing 95% of the voting strength which approved the Scheme and the appellant who represented dissenting 5% votes and consequently there was no appellant was concerned. Even otherwise such a separate meeting would not have made any impact on the voting pattern projected by the equity shareholders approving the said Scheme by overwhelming majority. Repelling the additional contention canvassed by learned counsel for the appellant it was submitted by Shri Sorabjee learned senior counsel for the respondent that there was no question of coercing any minority by the majority as in the meeting of the equity shareholders the appellant had not thought fit even to remain present personally and had only got represented through proxy for submitting his objection by voting against the Scheme without having any right to address the meeting. Thus the contention regarding alleged suppression by the majority was purely an afterthought especially when in the meeting the group of Arvind Mafatlal had not represented an absolute majority and 40% of the voting was by financial institutions who had no axe to grind against the appellant and who had voted by keeping in view purely commercial and economic interests of equity shareholders and had approved the Scheme in that light, It was, therefore, submitted that the contention raised on behalf of the appellant deserve to be rejected and the appeal consequently also deserves to be dismissed.

(b) in every notice calling the meeting which is given by advertisement, there shall be included either such a statement as aforesaid or a notification of the place at which and the manner in which creditors or members entitled to attend the meeting may obtain copies of such a statements aforesaid."

The aforesaid provisions of the Act show that compromise or arrangement can be proposed between a company and its creditors or any class of them or between a company and its members or any class of them. Such a compromise would also take in its sweep any scheme of amalgamation/merger or one company with another. When such a scheme is put forward by a company for the sanction of the Court in the first instance the Court has to direct holding of meetings of creditors or class of creditors or members or class of members who are concerned with such a scheme and once the majority in number representing three-fourths in value of creditors or class of creditors or members or class of members, as the case may be, present or voting either in person or by proxy at such a meeting accord their approval to any compromise or arrangement thus put to vote, and once binding to all creditors or class of creditors or members or class of members, as the case may be, which would also necessarily mean that even to dissenting creditors or class of creditors or dissenting members or class of members such sanctioned scheme even though approved by a majority of the concerned creditors or members the Court has to be satisfied that the company or any other person moving such an application for sanction under sub-Section (2) of Section 391 has disclosed all the relevant matters mentioned in the provision to sub-section (2) of that Section. So far as the meetings of the creditors or members, or their respective classes for whom the Scheme is proposed are concerned, it is enjoined by Section 391(1) (a) that the requisite information as contemplated by the said provision is also required to be placed for consideration of the concerned voters so that the parties concerned before whom the scheme is placed for voting can take an informed and objective decision whether to vote for the scheme or against it. On a conjoint reading of the relevant provisions of Sections 391 and 393 it becomes at once clear that the Company Court which is called upon to sanction such a scheme has not merely to go by the ipse dixit of the majority of the shareholders or creditors or their respective classes who might have voted in favour of the scheme by requisite majority but the Court has to consider the pros and cons of the scheme with a view to finding out whether the scheme is fair, just and reasonable and is not contrary to any provisions of law and it does not violate any public policy.

Conversely if the appellant succeeded in his counter- claim and director Arvind Mafatlal lost in his suit then all that would happen is that Arvind Mafatlal will have to transfer his share-holding and share-holding of his group in favour of appellant so far as the transferee-company is concerned. That future possibility would have no impact on the decision making process which had to undertake at this stage while approving the Scheme. Consequently such an eventuality was totally irrelevant for being brought to the notice of the equity shareholders before whom the scheme was put to vote. While deciding whether transferor-company should be merged with the transferee-company and the transferee-company's economic and industrial activity should be permitted to be enlarged as a result of such merger the equity shareholders were least concerned whether the appellant would purchase in future the share of the present director Arvind Mafatlal or vice versa. That was entirely their personal dispute which was still not adjudicated upon and its decision one way or the other had no impact on the pattern of voting of the equity shareholders of the respondent-company as a class of prudent businessmen and investors so far as the Scheme was concerned. The Scheme of Compromise and Arrangement which was put to vote was of such a nature that it had no impact or effect on the personal interest of the director Arvind Mafatlal in connection with his present share-holding in the transferee-company. Consequently it must be held that mention about such an interest was outside the statutory requirements of Section 393(1)(a) as rightly held by the learned Singly Judge whose view was erroneously upset by the Division Bench. However in any case we are in entire agreement with the subsequent reasoning of the Division Bench for approving the decision of the learned Single Judge on this aspect, namely, that such non-disclosure of interest had no impact on the voting pattern adopted at the meeting by the equity shareholders who are called upon to approve the scheme. It may also be noted in this connection that the resolution of the equity shareholders approving the Scheme of Amalgamation was passed with overwhelming majority by members including through proxies, present and voting. It projected the following picture :

So far as this point is concerned Shri Shanti Bhusan, learned senior counsel for the appellant, submitted that in modern days corporate bodies even though public limited companies are mostly controlled by big, influential and economically powerful families which have inherited entrepreneurial skill and expertise from earlier generations which had controlled such enterprise in past. That in the present case also the director the respondent-company Shri Arvind Mafatlal, the eldest male member of the family, had descended from the common ancestor Mafatlal Gagalbhai who had established this empire and which has further grown with passage of years. That when such a powerful director who is the eldest male member of the family is at the helm of affairs the minority interest of the appellant who, accordant to him was entitled to 50% share in the family concerns as per the 1979 family settlement was likely to be voted out and cornered by the influence of such a towering personality as Arvind Mafatlal in the meeting of equity shareholders. Therefore unfairness of the Scheme has to be judged also from the point of view of its impact on the minority shareholder who has a common ancestor Mafatlal Gagalbhai and who is sought to be cornered and deprived of his just share in the family concerns by the machinations of Shri Arvind Mafatlal. The Court has, therefore, to see whether the Scheme of Amalgamation which is sought to be put through at the behest of the director of respondent-company is fair to the minority group of the appellant who claims 50% share in the family concerns against the director of the respondent-company Shri Arvind Mafatlal and his group. So far as this submission is concerned Shri Sorabjee, learned senior counsel for respondent joined issues and submitted that factually there is no basis for such a contention as respondent-company is not controlled by Shri Arvind Mafatlal who is one of the directors along with his son Hrishikesh but there are eleven outside directors and the share-holding of Arvind Mafatlal and his group is not even 50% even including the share-holding of other subsidiary companies in which also Arvind Mafatlal and his group may be shareholders. We find considerable force in the aforesaid contention of learned senior counsel for the respondent. The evidence produced in the case shows that out of total majority vote of 95.75 per cent which supported the Scheme at the meeting of equity shareholders even according to the pattern disclosed by the appellant himself individual trust controlled by Arvind Mafatlal and private companies accounted to only 16% of the shares voted in the meeting, about 44% of the shares were represented by financial institutions, employees and public taken together and two companies stated to be from Mafatlal group had only 15% shares. Consequently it is too much to contend that the voting pattern was dominated by the share-holding of Arvind Mafatlal and his group when about 40% of the shares are held by financial institutions which had nothing to do with the internal feuds of director Arvind Mafatlal on the one hand and the appellant-objector on the other. It could not be said that the scheme as put to vote was in any way unfair to appellant or that the majority shareholders acting as a class had not behaved in a bona fide manner for protecting the interest of the class as whole and were n any way inimical to the appellant. While considering the question of bona fides of the majority voters and whether they were unfair to the appellant it has to be kept in view that bona fides of the majority acting as a group has to be examined vis-a-vis the Scheme in question and not the bona fides of the person whose personal interest might be different from the interests of the voters as a class. Bona fide of person can only be relevant if it can be established with reasonable certainty that he represents majority or is controller of majority. Arvind Mafatlal cannot be visited with such a charge. In this connection we may usefully refer to a decision of English Court in the case of Hellenic and general Trust Limited reported in 1976 (1) WLR 123. In that case the court was concerned with a Scheme of Arrangement whereunder all the ordinary shares of the company were to be cancelled and new shares were to be issued to Hambros which would make the company as wholly owned subsidiary of Hambros. Holders of such cancelled shares were to be paid by Hambros at 48 pennies. In short it was an arrangement for taking over of the company by Hambros. 53% shares of the Hellenic Company were held by another company MIT. MIT itself was a wholly owned subsidiary company of Hambros. This situation led the court to conclude that the subsidiary company of Hambros which was holding such large number of shares placed itself vis-a-vis Hambros in the position of vendor and the lifted vail of transaction showed it to be one of acquisition than of transaction showed it to be one of acquisition than of amalgamation. The aforesaid decision is a pointer to the fact that what was required to be considered while sanctioning the scheme was bona fides of the majority acting as a class and not of one single person. It is, therefore, not possible to agree with the contention of learned senior counsel for the appellant that the majority had acted unfairly to the appellant and had not protected his interest of minority shareholders falling in the same class along with the majority. It is not contention in favour of the Scheme the majority had acted with any favour of the Scheme the majority had acted with any oblique motive to fructify any adverse commercial interest qua him and his group when it consisted of outsiders like financial institutions or that there was any possibility of their surrendering their economic interest in the Scheme at the dictates of shareholder-director Arvind Mafatlal and his group. It is also to be kept in view that the Board of Directors of the respective companies, namely, the transferor-company as well as the transferee-company had approved the Scheme of Amalgamation before it was put to vote. The appellant was himself was one of the directors of the transferor-company who had no objection to the Scheme of Amalgamation from the point of view of the transferor- company. So far as the transferee-company is concerned though appellant was not a director he was 5% shareholder who did not think fit to personally remain present at the time of voting and simply relied upon proxy. If he was feeling that the Scheme was unfair to him or was not going to protect his interest as shareholder in the respondent- company nothing prevented him from remaining present and voicing his grievance before the General Body of the equity shareholders and to apprise them of the alleged pernicious effect of the Scheme. It is, therefore, too late in the day for him to contend that the Scheme was unfair to him and that the family of Arvind Mafatlal has tried to dominate and engineer any adverse pattern of voting at the meeting of the equity shareholders.