TMI Blog2014 (9) TMI 1262X X X X Extracts X X X X X X X X Extracts X X X X ..... w entirely known to the Dattaraj Group. The latter seems to have appropriated to itself certain properties. The only reasons given for opposing specific performance are, as discussed, untenable and even specious. That there was no concluded agreement is not a defence capable of acceptance. The tax evasion argument is one of desperation. As to the defence by Defendants Nos. 2 to 8, perhaps the less said the better; this is nothing but subterfuge and mendacity. The conclusion is irresistible that the Plaintiffs have made out a more than sufficient prima facie case, and have demonstrated too, that the balance of convenience is in their favour. It is self-evident that if reliefs as sought are not granted, immeasurable and irredeemable loss will be occasioned to them. The injunctions they seek, with some modifications, must be granted. Notice of motion disposed off. - Notice of Motion No. 1372 of 2013 in Suit No. 719 of 2013 - - - Dated:- 19-9-2014 - G.S. Patel, J. For the Plaintiffs : Mr. I.M. Chagla, Senior Advocate, with Mr. D.D. Madon, Senior Advocate, Mr. Riyaz Chagla Mr. Ankit Lohia, i/b M/s. Dastur Dadhich Kalambi. For the Defendant No.1 : Dr. Veeren ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich I will outline in greater detail shortly; (2) the Plaintiffs proposal dated 26th October 2009 for segregation of the family businesses, together with a revised proposal of 23rd November 2009; (3) a letter dated 11th December 2009 from the 1st Defendant to the 1st Plaintiff setting out some amendments to the Memorandum of Understanding; (4) a letter of election of the same date also from the 1st Defendant to the 1st Plaintiff, said to be an acceptance of the Plaintiffs proposal for segregation of the businesses; (5) closed sealed bids for two residential properties of the two groups and the declaration or announcement of the 1st Defendant as the purchaser of one of these after the bids were opened; (6) the Defendants proposal for division and segregation of certain real estate properties; and (7) an election letter dated 11th December 2009 from the 1st Plaintiff to the 1st Defendant accepting the Defendants immovable property division proposal. The contemplated division or separation is one that is said to relate to family businesses, assets and properties, including interlocking shareholding. 4. Till the time of the Family Arrangement, the two branches of the family ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r children. Plaintiffs Nos. 5 to 7 are private limited holding companies or investment companies. Plaintiff No.8 is a limited liability partnership. The 1st Plaintiff ( Shivanand ) controls Plaintiffs Nos. 5 to 8: they act on his directions. Plaintiffs Nos. 5 to 8 hold equity on behalf of Shivanand in the VMSB Group. Defendant No.2 ( Dipti ) is the wife of the 1st Defendant ( Dattaraj ). Defendants Nos. 3 and 4 are their children. Defendants Nos. 5 to 8 are holding or investment companies controlled by Dattaraj and which are said to act at his direction. They hold equity in the VMSB group on Dattaraj s behalf. Dattaraj himself personally holds 80% of the equity of Defendants Nos. 5, 6 and 7 and 50% of the equity in Defendant No.8. This is a factor that materially affects one of the submissions taken in opposition to this Notice of Motion. 7. There are thus two families and three groups. Shivanand s family is Plaintiffs Nos. 1 to 4; and the Shivanand Group includes them and the companies they control, Plaintiffs Nos. 5 to 8. Dattaraj s family is Defendants Nos. 1 to 4, and the Dattaraj Group includes them and the companies they own and control, Defendants Nos. 5 to 8. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se were discussed. On 12th July 2008, Dattaraj offered to prepare a proposal. Broadly, the idea was that the family businesses would be divided in two. Shivanand would have the option of choosing either lot. There is some mileage sought to be drawn by the Plaintiffs about who was present at this meeting; I will return to this later, to the extent I find it necessary. In any case, Dattaraj did work on the proposal, assisted by his various consultants and advisors. Again, the process took some time, and it was not till February 2009 that Dattaraj s proposal took final shape. On 2nd February 2009, Dattaraj sent Shivanand a draft Memorandum of Understanding. This had a proposal for division of the family businesses. Though in draft, it contained detailed provisions for implementation. Shivanand did not accept this, finding it one-sided. What is, however, of some consequence, that this draft emanating from Dattaraj - a copy is Exhibit D to the plaint - clearly showed him acting not just for himself but for his group and contemplated Shivanand acting for his group in return. 11. Two months later, on 2nd April 2009 there was a meeting in Mumbai at the Taj Mahal Hotel Towers Cham ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wo Residential Properties. It details the various steps and actions to be taken by each group in implementation. Annexed to it is a draft Power of Attorney for the proposed demerger and a draft Agreement for Sale of the Hira Vihar property. Both drafts are initialled by Shivanand and Dattaraj. The MoU specifically says that both Shivanand and Dattaraj have signed it for themselves and on behalf of those persons and entities listed in Schedules 1 and 2 to it; and that both Shivanand and Dattaraj jointly represent the parties in Schedule 3. This array covers all the parties and entities: Schedule 1 is Plaintiffs Nos.2 to 8; Schedule 2 lists Defendants Nos. 2 to 8; and Schedule 3 lists Defendants Nos.9 to 31 plus for public trusts which, too, passed resolutions, but whose assets are, and quite rightly, not the subject matter of this dispute. It is in this context that the Plaintiffs say that in signing the MoU Shivanand and Dattaraj acted not only for themselves individually but also for their families and entities in their groups. Defendants Nos. 9 to 31, the VMSB Group, are said in the MoU to be in the joint control and management of the two brothers. The MoU intended the restructur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ential Properties, Hira Vihar and Baina House, the latter, though part of the VMS Estate was excluded from the VMS Estate division arrangements. Baina House in Mormugoa was the earlier residence of the Salgaocar Family, and was apparently not habitable, being in state of disrepair. Hira Vihar, on the other hand, was the residence of both families, the family seat. By all accounts, this is a splendid estate of about six acres or so on the Airport Road at Chicalim with a stately mansion set in verdant and landscaped grounds and of evident heritage and aesthetic value. The entire property is owned by Shivanand, Dattaraj and Green Hills Developers and Builders Pvt Ltd ( Green Hills ), a company equally held by the two brothers who are its only shareholders. Under the MoU, along with the division and separation proposals for the family businesses and the VMS Estates, the Shivanand and Dattaraj Groups were to deposit with Choksi their respective net offers in sealed envelopes for the outright purchase by each of the other s undivided share, right, title and interest in these two Residential Properties. These bids were to be opened when the elections or choices for the two sets of baske ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion, one that is also dated 11th December 2009. This was signed by Dattaraj and given to Shivanand, who acknowledged receipt. 22. The sealed bids for the two Residential Properties were opened in Choksi s presence. Dattaraj s offer was the higher. In terms of the provisions of the MoU, Dattaraj gave Choksi a cheque for 25% of the net offer. Shivanand signed an Agreement for Sale and share transfer forms for the transfer of his holding in Green Hills. These were also given to Choksi. All these were to be held in escrow by Choksi. 23. As regards the VMS Estate, Shivanand chose Basket A of the two lots proposed by the Dattaraj Group. He submitted a letter of election, also of 11th December 2009, to Dattaraj. 24. These then are the ingredients of the what the Plaintiffs describe as a concluded agreement capable of specific performance, i.e., (a) The MoU of 4th October 2009; (b) The Shivanand Group s family businesses separation proposal dated 26th October 2009 read with the revised proposal of 23rd November 2009; (c) Dattaraj s letter dated 11th December 2009 setting out agreed amendments to the MoU; (d) Dattaraj s letter of election of 11th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Requests for meetings were either delayed or ignored. Dattaraj consented to an extension of time for making payment under the MoU, inter alia by several letters between 2nd March 2010 and end April or early May 2010. In parallel, a number of other issues seem to have been raised including the transfer over of household and administrative staff and employees. There were also some meetings and discussions but none of these resulted in any further agreed modification or agreement. 28. Undeniably, several other actions were taken in the meantime, none of which were, but for the Family Arrangement, either necessary or even perhaps possible. These included an increase in the share capital of the 20th Defendant, an amendment of its articles, and its change of name from Sterling Granites Pvt Ltd to its present name; the purchase by the 9th Defendant of the five equity shares held by Shivanand and Dattaraj in the 20th Defendant, thus making the 20th Defendant a wholly-owned subsidiary of the 9th Defendant (itself contemplated by the 23rd November 2009 proposal), and an extension of time by the 9th Defendant s Board of Directors for holding its Annual General Meeting and extending it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and a revised escrow note or letter. Further drafts and emails were exchanged till September 2010. 31. On 8th October 2010, Shivanand emailed Dattaraj protesting at the continued delay and attempts at reopening issues previously settled. In this email, Shivanand said that if the draft scheme was not filed and the documentation completed by 25th October 2010, he would invoke the dispute resolution provisions of the MoU. Dattaraj replied on 22nd October 2010. He now claimed that what was envisaged under the MoU could not be implemented inspite of best efforts , and that this had rendered the MoU otiose (in his words, unimplementable ), and that the MoU was now frustrated . He claimed that there were now serious differences on the details, methodology and mechanics of implementation of the MoU which could not be resolved even after prolonged negotiations . This is, even now, the heart of the Defendants case. But what is curious about this communication is its almost complete lack of specificity: at no point in it does Dattaraj say precisely what these problems were or why the MoU could not be implemented. 32. Further meetings were held, but without result. On 27th A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Dipti herself and her two children with Dattaraj, and the second was on behalf of Defendants Nos. 2 to 8. In these, Dipti raised a preliminary issue of jurisdiction. She said that she, her children and the Dattaraj Group investment companies (Defendants Nos. 5 to 8) were not parties to the Family Arrangement and, consequently, not parties to the arbitration agreement in it either; that Dattaraj never had the authority to represent them or to commit on their behalf; that, in any case, Defendants Nos. 5 to 8 were companies and absent any specific authority, which did not exist, Dattaraj could not bind those companies to any such agreement, understanding or arrangement; and that except for Dattaraj, none of the others (Defendants Nos. 2 to 8, Dipti, her children and the group companies) were at any point aware that the Shivanand and Dattaraj were entering into any such agreement. 36. Shivanand replied to these applications on 6th April 2013, and Dipti then filed an application on 7th May 2013 to strike out some statements in the Plaintiffs reply. 37. In the meantime, the Plaintiffs Advocates corresponded with the (new) Advocates for Defendants Nos. 2 to 8 in March and A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e higher of the two, and was accepted in a most transparent manner. 41. The attempt to now renege on the agreement comes not from Dattaraj directly, but from Dipti, his wife. Her claims to innocence of all these matters are ex-facie unworthy of any credence. Mr. Chagla is at some pains to emphasise the fact that among Dattaraj s advisors were two, a senior solicitor and a reputed accountant and tax consultant, both closely associated with the Mukesh and Anil Ambani, Dipti s brothers. Though the Ambani brothers separated, and the consulting solicitor and the accountant were aligned one with each brother, they nonetheless came together to advise Dattaraj. This could only mean that they were also safeguarding the interests of Dipti and the two children. This was no mere coincidence: there were even meetings at Reliance s offices. 42. To say that the scheme was not agreed on is wholly incorrect. What remained was a formality, a matter of procedure in how most efficiently to effect the corporate separation of the two businesses. That could not and did not affect the binding nature of the agreement and the Family Arrangement. 43. The entire argument about the demerger ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e average percentage of dividend declared and distributed by the 9th Defendant was about 36% of the company s Profit After Tax. Carrying this forward, and applying it to the succeeding years, Defendants Nos. 5 to 8 would have received dividends in the aggregate of over Rs.145 crores. On a similar computation, Defendants Nos. 2, 3 and 4 would have received about Rs.134 crores as profit sharing from the 30th Defendant partnership firm. None of these Defendants ever objected to the non-distribution of dividend or profit, a result of, and only of, the provisions of the MoU. 47. As to the binding nature of the concluded agreement or Family Arrangement, Mr. Chagla submits that subsequent negotiations, first commenced on new points after a contract complete in itself has been signed, are not part of the negotiations going on at the time when it was signed. What remained was a mere modality or facilitation of the concluded Family Arrangement. It is one thing to say that a contract must not be inchoate. It is quite another to contend that every minute detail must be anticipated, expressed and provided for. Legal arrangements, required in the normal course and best left to legal advise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t said that family settlements cannot be viewed in the same manner as ordinary commercial transactions. Internal mechanisms for effectuating the settlement are not to be lightly disturbed. 50. Mr. Chagla also relies heavily on the observations of the Supreme Court in Hari Shankar Singhania Ors. v Gaur Hari Singhania Ors. [(2006) 4 SCC 658] in particular these: Family arrangement/family settlement 42. Another fact that assumes importance at this stage is that, a family settlement is treated differently from any other formal commercial settlement as such settlement in the eye of the law ensures peace and goodwill among the family members. Such family settlements generally meet with approval of the courts. Such settlements are governed by a special equity principle where the terms are fair and bona fide, taking into account the well-being of a family. 43. [Ed.: Para 43 corrected vide Official Corrigendum No. F.3/Ed.B.J./37/2006 dated 11-5-2006.] The concept of family arrangement or settlement and the present one in hand, in our opinion, should be treated differently. Technicalities of limitation, etc. should not be put at risk of the implementation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nship with one another. ... 49. Further, in Krishna Beharilal v. Gulabchand [(1971) 1 SCC 837] this Court reiterated the approach of the courts to lean strongly in favour of family arrangements to bring about harmony in a family and do justice to its various members and avoid in anticipation future disputes which might ruin them all. This approach was again re-emphasised in S. Shanmugam Pillai v. K. Shanmugam Pillai [(1973) 2 SCC 312] where it was declared that this Court will be reluctant to disturb a family arrangement. 51. The valuable treatise Kerr on Fraud at p. 364 explains the position of law: The principles which apply to the case of ordinary compromise between strangers do not equally apply to the case of compromises in the nature of family arrangements. Family arrangements are governed by a special equity peculiar to themselves, and will be enforced if honestly made, although they have not been meant as a compromise, but have proceeded from an error of all parties originating in mistake or ignorance of fact as to what their rights actually are, or of the points on which their rights actually depend. 50. In Kale v. Dy. Director of Consol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m of understanding has been substantially acted upon and hence the parties must be held to the settlement which is in the interest of the family and which avoids disputes between the members of the family. Such settlements have to be viewed a little differently from ordinary contracts and their internal mechanism for working out the settlement should not be lightly disturbed. (emphasis supplied) 53. Therefore, in our opinion, technical considerations should give way to peace and harmony in the enforcement of family arrangements or settlements. 51. Everything, Mr. Chagla says, points to both sides having accepted and acted on the Family Arrangement. How else, he asks, could Dattaraj have started development on the plot at Chicalim, renovations at Hira Vihar and the conversion of the guest house to commercial use except in implementation of the Family Arrangement? What other explanation can there possibly be for the routing of Rs.5 crores by Dattaraj and Dipti through one of their investment companies into the 20th Defendant, the proposed resultant hotel company on demerger? II. Defendant No.1 52. The response from the 1st Defendant is, first, that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd this was Proposal 2. This was further amended on 23rd November 2009 by Shivanand, and became Proposal 3. There then followed the meeting of 11th December 2009 at which, or so Dattaraj says, Shivanand accepted the unamended proposal of 26th October 2009. But what followed in the next few months clearly establishes that there was no concluded agreement and that parties were still at the stage of negotiations. On 28th February 2010, Shivanand emailed Dattaraj saying that he had ready the funds he was required to pay under the MoU and resultant on the 11th December 2009. But Shivanand also protested at the repeated attempts by Dattaraj s lawyers to effect changes that were unacceptable to him. Dr. Tulzapurkar reads this email, and in particular the words I am happy to execute a further revised draft to record our agreement that the payment date is deferred to March 15, 2010 in terms of the document attached to mean that there were still negotiations and no concluded agreement. I cannot agree. That sentence must be read in context. The email, read as a whole, makes it clear beyond a shadow of doubt that Shivanand insisted on the performance of the MoU, the proposals and the elect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the table. There could, it is submitted, in such circumstances be no question of a concluded contract. 58. Mr. Chagla protests with uncharacteristic agitation at this. This document of 8th December 2009 is, he says, smuggled in for the first time in this multi-volume compilation, the convenience of which is not far to seek. I believe there is good cause for Mr. Chagla s indignation. I have not found this document anywhere in the affidavits, though a very large number have been filed. Dattaraj filed a detailed Affidavit in Reply. This so-called revised proposal is not referred to it once in that Affidavit in Reply. It is not annexed. What is now put into the compilation is some unsigned document, one that ought never to have been introduced, and certainly not without leave of the court. Even more telling, as Mr. Chagla says, is the fact that all other such documents were mutually initialled; all but this one. 59. Leaving aside all this Sturm und Drang about the introduction of this so-called revised proposal, what is material are two things: what Dattaraj did on 11th December 2009, a few days after this socalled revised proposal; and how he has in his Affidavit in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sal is a piece of evidence to which he is not required to plead, citing Order VI Rule 2, is merely disingenuous. This is not a matter as simple as that. This is fundamental to the 1st Defendant s case and it is not unreasonable to expect a reference to it in the affidavits (which, if one wants to be technical, are not pleadings strictly speaking). A defence is sought to be constructed on this document, and it is no answer at all to say that it matters not if it was not referenced anywhere to dislodge the Plaintiffs claim or even in support of the 1st Defendant s case. Dattaraj runs himself on his own sword: his Affidavit in Reply contains much in the nature of arguments and submission that falls entirely outside Order VI, Rule 2. It simply cannot be that those procedural rules apply to the elision of crucial material, but not to the inclusion of matter that is in no sense a pleading . Whether or not this document of 8th December 2009 was ever sent and in what form will await trial. At a prima facie stage, on this state of the record and the pleadings, it is impossible to accept Dattaraj s contention that his first proposal for the VMS Estate had lapsed and that his second propo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sideration of the question, the objection that there is no concluded agreement is generally taken in one or the other of two forms. It is said that there was only a conditional agreement and since the condition has not been fulfilled. the agreement never matured into a binding contract of which specific performance could be had. Or it is said that there was only a partial agreement, covering only some of the terms of the contract and since the remaining terms still remained to be agreed to, there was no completed contract which could be enforced. Mallick, J., appears to have regarded the present case as falling under the second category. He held that the offer of the Appellants had not been made on the basis of the conditions of sale, because they had not then been even seen, and since the Appellants had subsequently been proposing modifications of the conditions, it was clear that the parties had not passed the stage of negotiation. Many points , observed the learned Judge, have yet to be hammered out before the agreement is finalised . ... 15. Whether or not there was a concluded contract depends upon the true construction of what the parties said or did or wrote at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... condition and whether by refusing to accept a particular scheme or suggest a viable alternative, Dattaraj could be allowed to scuttle the entire Family Arrangement. The decisions cited seem to me not to lend themselves to any such formulation. For, it would this that would then be against public policy, allowing every defendant in every such action to simply refuse to commit to one or other of alternative choices laid before him and, on that basis, to contend that there was no concluded agreement. That surely cannot be what the law contemplates. There was nothing conditional about Dattaraj s acceptance. Indeed, he acted on it. He sent out money to purchasing shares in the 20th Defendant, an action contemplated under the MoU. He started work on immovable properties as if they were his own, and these would come to him only on an unconditional acceptance of the Family Arrangement and in no other circumstances. In Subodh Chandra Bala, the Calcutta High Court found that it was the appellants themselves who said, while insisting on the contract, that they did not accept the terms of sale. That is not the case here. 65. Dr. Tulzapurkar s reliance on Ganesh Shet v Dr. CSGK Setty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t it can be known whether or not it has been performed, then that terms is held to be bad for uncertainty. Whether the remaining part of the contract is valid depends on whether or not, as a matter of construction, the obligation to perform that remaining part has been intended by the parties to be conditional on the validity of, or on the performance of, the uncertain term that is in question. But it must be noted that uncertainty in this sense differs from mere ambiguity: for every terms may be in some respects ambiguous. If there is ambiguity, in the sense that it is not clear whether a particular matters falls within the denotation of the term that is in question, that ambiguity is resolved according to the ordinary rules of interpretation, whereas invalidating uncertainty exists if, despite an attempt to determine the meaning of the terms in question by the aid of the ordinary rules of construction, that term is so indefinite that its meaning is not able to be fully ascertained. Sometimes it is found that a term that would otherwise be too uncertain may be construed as having a sufficiently definite meaning by reference to a particular course of dealing between the parti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and physicians and anaesthetists and nurses argue among themselves on the quality and brand of, say, postsurgery sutures, the parties should continue to lie forever like two patients etherized upon a table? Though these are, so to speak, and with no disrespect intended, tedious arguments of insidious intent they do not tend to any overwhelming question, let alone this: what is it? I think the answer to that is clear from the terms of the documents and the manner in which the parties conducted themselves: this is a binding and concluded Family Arrangement, one capable of specific enforcement. 68. Dr. Tulzapurkar s then says that the entire Family Arrangement as conceived is tax evasive . In his Affidavit in Reply, Dattaraj says it is void as being opposed to public policy . Paragraph 15 of the Affidavit in Reply lists the various steps to be taken for the demerger, and Dattaraj then says that a brief to counsel was prepared. Whether or not it was ever sent and if so what advice if any was received are matters yet unclear. The submission, at least as I understand it, is that there are likely to be penal consequences to the adoption of a particular method of demerger; and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f tax avoidance as contract avoidance. 69. A comparative chart of the three proposals was presented by Dr. Tulzapurkar. Although this was supposed to show the differences between the three proposals, I have dealt with here, after the arguments on the alleged tax evasive nature of the agreement, because the comments on the subsequent proposals are broadly directed to this end. Although the attempt was to show that the three proposals differ, what emerges is that Proposal 4 and Proposal 5 took into account the Finance Act, 2010, as indeed they ought. There are also comments on the consequences of the subsequent proposals but, interestingly, the chart itself provides anticipated, legitimate solutions, including the share of any additional tax burden and the deployment of escrow mechanisms. In and of itself, this chart does not establish that there was no concluded contract. All that it shows is that there were modalities to be resolved, and parties had before them a range of options. In his Affidavit in Reply, Dattaraj does not say that the scheme has been frustrated by a subsequent change in law that renders it impossible or incapable. The allegations in paragraphs 15 and 16 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is that there is nothing to indicate that Dattaraj was acting for all these persons and entities. I do not believe this to be correct. I have already discussed Dipti s role in the matter, and how she entered the fray only at the eleventh hour. Throughout persons who would not, but for her, been advising Dattaraj were involved. Her own brothers senior consultants came together to advise and guide. She herself is in a position of some authority vis- -vis the investment companies and entities, and she herself contributed Rs.2.5 crores towards the equity subscription of the resultant hotel company, the 20th Defendant. Even given the parties financial pre-eminence, this is amount is not trivial. There is material, too, to show that Defendants Nos. 5 to 8 are entirely under the dominion of Dattaraj and Dipti; they act at their command, and the two can will the companies to do as they direct. Chloro Controls sufficiently covers such a situation. Mr. Bharucha s reliance on the decision of a Division Bench of the Punjab High Court in L. Shiv Dayal Kapoor Ors. v Union of India [AIR 1963 Punj 538, 545] invoking the doctrine of privity is, in the facts of this case, is entirely mispla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o Dattaraj, and there was no board resolution (in contrast to the manner in which Shivanand s investment companies acted). At no point did Defendants Nos. 5 to 8 hold out any assurances to the Shivanand Group, and no representation could be attributed to them. Dattaraj has no ostensible or implied authority and these Defendants did nothing to induce the Shivanand Group to believe that he did. He relies on the decision of the Supreme Court in Indowind Energy Ltd v Wescare (India) Ltd Anr. [(2010) 5 SCC 306] in support of these submissions. Mr. Chagla is, I believe, correct in pointing out that Indowind arose under Section 11 of the Arbitration Conciliation Act, 1996, and in any case, was not concerned with the segregation of a family business with such complex interlocking as this. Indowind is distinguishable on account of the observations in paragraph 20, where the Supreme Court says that questions of validity of contract and breach are possible in a specific performance suit or an action in damages, but not in a matter under Section 11. On facts, he says, there is no denying that Dattaraj holds 80% of the equity in three of the four companies and 50% in the other. Between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r repairs to this building. He does not however seem to deny that its user is being changed or that this has been done without notice to the Plaintiffs. Indeed, his traverse on this is most unsatisfactory. D. CONCLUSIONS AND ORDER 76. Was there a binding and concluded Family Arrangement as pleaded, one capable of specific performance? I believe the answer must be yes, for several reasons. The documents and events of 11th December 2009 all show so. The subsequent conduct of the parties also indicates that this is so. Were Defendants Nos. 2 to 8 bound by this Family Arrangement? Again, for the reasons I have discussed, I believe the answer must be in the affirmative. There is yet another way to envision this. What is the consequence of denying the Plaintiffs relief? I imagine this much is clear: the affairs of the Shivanand Group are now entirely known to the Dattaraj Group. The latter seems to have appropriated to itself certain properties. The only reasons given for opposing specific performance are, as I have discussed, untenable and even specious. That there was no concluded agreement is not a defence capable of acceptance. The tax evasion argument is one of despera ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fendant No. 9 to 30 for any personal and other payments other than those in the usual course of business of Defendants Nos. 9 to 30 unless and until the same are approved by the Plaintiff No.1 and the Defendant No.1 as the case may be; (e) That pending the hearing and final disposal of the present suit, the Defendant Group be restrained by an order of temporary injunction of this Hon ble Court from: i. Continuing with the development activities on the said Plot No.E4 at Village Chicalim, Goa; ii. Applying for any further or other permissions including a Completion Certificate or an Occupation Certificate for the said construction being carried out on the said Plot No.E4, Village Chicalim, Goa; iii. Creating any third party rights in the said development or in any manner using or enjoying the said Commercial Development on the said Plot E4, Village Chicalim, Goa; iv. Applying for or carrying out any development on any of the plots of the VMS Estate which are to go to the share of the Defendant Group and which are set out in Basket B to the Proposal annexed as Exhibit J to the Plaint; (f) That pending the hearing and final disposal of the prese ..... X X X X Extracts X X X X X X X X Extracts X X X X
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