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2012 (8) TMI 629 - DELHI HIGH COURTPetition against Award u/s 34 by Arbitrator - Arbitrator erred in not dealing with the issue of the shareholding pattern of the Respondent No. 1 company - Held that:- The order referring the disputes between the parties to arbitration no doubt begins by stating that "all the disputes between the parties regarding the share holding of the said company" are being referred. However, it also notes that the Petitioners' Group had agreed to surrender and transfer their shares in the Respondent No. 1 company to Respondent Nos. 2 to 5 or their nominees for a consideration which will be decided by the learned Arbitrator. The learned Arbitrator was also to decide "the mode and method of payment of the said consideration". Consequently, it was unnecessary for the learned Arbitrator to decide about the shareholding pattern since in any event the Petitioners agreed to transfer all their shares to Respondent Nos. 2 to 5 for a consideration, therefore no error having been committed by the learned Arbitrator in this regard. Valuation of the Petitioners' shares - Held that:- In the Award the Arbitrator in method adopted by him for valuation has not only considered the value of the assets of the Respondent No. 1 company i.e. the plot of land and the value of the construction thereon, but also the outstanding liabilities , this, in fact, was the correct approach. A perusal of the report of M/s. G.C. Mallick & Associates, Chartered Accountants also reflects this approach. While the report of M/s. Kumar Narang & Co., Chartered Accountants accounts for the current liabilities and unsecured loans, it fails to provide for the contingent property tax liability. The land and building value according to the said report is no doubt higher than that suggested by M/s. G.C. Mallick & Associates, however the report fails to explain the basis for such higher value. In any event it was for the learned Arbitrator to take a decision as to which of the two reports was more reliable & It cannot be said that the learned Arbitrator erred in not going by the report of M/s. Kumar Narang & Co. It is not possible to agree with the submission of the Petitioners that by fixing the value per share of the Respondent No. 1 company at Rs. 450, the learned Arbitrator committed a patent illegality. The view of the learned Arbitrator, in the circumstances was a plausible one - no ground having made out for interference with the impugned Award - against petitioner.
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