Ms. Heena Dutt v. Chavi Designs P. Ltd. And Another

Smt. Vimla Yadav, Member:— In this order I am considering Company Petition No. 10 of 2002 wherein Ms. Heena Dutt, the petitioner who is a professional interior designer has alleged oppression and mismanagement in the affairs of respondent No. 1-company, namely, M/s. Chavi Designs P. Ltd., and specifically against respondent No. 2, namely, Shri Sandeep Dutt (petitioner's husband against whom divorce proceedings are pending) under sections 397 and 398 of the Companies Act, 1956 (hereinafter referred to as “the Act”).

2. Respondent No. 1-company, which was incorporated on July 25, 1991, with the Registrar of Companies, Delhi and Haryana, having registered office at J-197, Saket, has two directors, i.e, petitioner and respondent No. 2 having 50 per cent. shares each. No other person has any share in the company. Its authorised capital was Rs. 1 lakh and paid-up capital till date is Rs. 2,000. The company commenced business of furniture and interior designing and have been handling various contracts relating to furnishing of premises. The company had two showrooms (a) Aya Nagar, Mehrauli and (b) M-45, Greater Kailash-I, New Delhi. The factory and godown of the company is at Khasra No. 674, Nai Basti, Extended Abadi, Devli Village, New Delhi. The factory and godown as a single unit built on land owned by the petitioner and respondent No. 2. Shri Sandeep Sahay, counsel for the petitioner, argued that the petitioner's matrimonial life was marred with physical abuse and violence. On March 17, 2001, the petitioner and her minor children were thrown out of the matrimonial home by respondent No. 2, in wearing apparels (complaint dated March 19, 2003, at police station DLF City, Phase II, Gurgaon, annexure 5, page 60, rejoinder refers). Respondent No. 2's mother and brother and other people are facing criminal prosecution and charge sheet has been filed. Ref. FIR No. 178 of 2001 under section 406/498A, IPC in the court of Judicial Magistrate, Ruby Alka Gupta, Patiala House. The petitioner procured the documents from the Registrar of Companies and the income-tax authorities to file petition under sections 397 and 398 of the Act.

3. It was argued that the stocks and cash of the company always remained under exclusive control of respondent No 2. Since the finances of the company remained under control of respondent No. 2, the true and net turnover was never shown in the balance-sheet and other accounts of the company. The turnover of the company was more than Rs. 5 crores. The clients of the company included Airtel, free processing assess and main Airtel's chief house, farm house for Metro Tyres, etc. My attention was drawn to the news item in the Economic Times dated June 13, 1999, page 59, annexure of the rejoinder. It was argued that as per the manipulated balance-sheet and profit and loss account for the years ending March 31, 1999, the company owed to the petitioner Rs. 2,58,557.53 (page 12, list of documents filed with the petition referred to).

4. Further, it was argued that after the petitioner has been thrown out of the company, no statutory compliance has been done by respondent No. 2 under the Companies Act, Income-tax Act, etc. Neither balance-sheet has been filed nor annual report nor profit and loss account has been filed for more than five years. This itself shows, it was argued, that there has been complete oppression and mismanagement of the company by respondent No. 2.

5. It was argued by counsel for the petitioner that after the petitioner was thrown out of the company, respondent No. 2 was not legally authorised to manage the affairs of the company in view of the provisions of section 252 of the Companies Act. Minimum two directors are required for the functioning of the company. On November 1, 1997, Ms. Shubhra Dutt was appointed as additional director of the company (Form 32, annexure C, page 22, rejoinder referred). Since respondent No. 2 wanted to perpetuate illegality, respondent No. 2's mother Shubhra Dutt with criminal intention started impersonating herself as director. It was pointed out that she has committed criminal offence by impersonation and has illegally usurped the power of respondent No. 1. The petitioner, it was pointed out, reserves her right to take appropriate legal action. As per section 260(2) of the Act, an additional director is only for a period of one year and compulsory ceases to be an additional director once next annual general meeting has been called. Article 26 of the articles of association of the said company also provides for the same. The term of Shubhra Dutt as additional director was not renewed after the annual general meeting held on September 27, 1999. The notice to the members regarding the annual general body meeting to be held on September 27, 1999, does not have an agenda for renewal of the additional directorship of Shubhra Dutt. Respondent No. 2 has falsely alleged that Shubhra Dutt is a director by referring page 39 of the reply of respondent No. 2. The name of Shubhra Dutt as the director in the annual report is incorrect and has been done only for the reason as there is no column of additional director in the said form. The date of appointment shown in these said annual report is November 1, 1997. According to respondent No. 2 also on November 1, 1997, Shubhra Dutt was appointed as additional director. Respondent No. 2 has alleged that the issue of appointment of Shubhra Dutt as director was put in the agenda of the annual general meeting to be held on September 29, 1998. No documents have been produced that Shubhra Dutt was ever appointed as a director of the said company. The documents filed by respondent No. 2 show the date of appointment of Shubhra Dutt as November 1, 1997, i.e, the date on which she was appointed as an additional director. There are various statutory requirements for appointment of a director. The same is given in Schedule A to the present written submissions. Not a single document has been filed. No such document has been filed or produced, as Shubhra Dutt was never appointed as a director.

6. It was argued that after the petitioner was thrown out of the company, respondent No. 2 siphoned off the entire fund of the company (as per details given in schedule 1, paragraph 11, page 8 rejoinder). The total amount withdrawn by respondent No. 2 is Rs. 10,19,000. Respondent No. 2 has not given any explanation where the dishonestly and illegally withdrawn money of the company has been used. Respondent No. 2 has not denied the fact that these amounts have been withdrawn by him. Respondent No. 2 has vaguely and falsely stated without producing any documents, that the same have been utilised. At the time when the petitioner was thrown out of the said company, the said company had a stock worth of Rs. 34,43,375. This fact is also not denied by respondent No. 2.

7. Counsel for the petitioner further argued that respondent No. 2 has deliberately not stated in the reply regarding showroom at M-45, Greater Kailash-I, New Delhi. The said showroom was the most famous showroom of respondent No. 1 located in one of the posh localities of Delhi. The said showroom has been reported in various newspapers (pages 54 to 58 of rejoinder were referred). All the stocks of the said showroom were illegally removed by respondent No. 2 to the factory at Devli, and thereafter was sold under the name of Chavi Interiors (page 50, rejoinder, paragraph 7 of the affidavit of the caretaker of the showroom were referred).

8. Further, it was pointed out that respondent No. 2 has falsely alleged that the showroom at Aya Nagar was demolished by the MCD, without notice and all the stocks were damaged. The said contention of respondent No. 2 is contrary to law and the facts. Under sections 343 and 344, etc., of MCD Act, MCD has to serve notice to the aggrieved person before carrying out demolition. Respondent No. 2 was in fact served a notice by the MCD and the respondent was given three days' time to remove the articles. Thereafter, respondent No. 2 removed all the articles to his house A-22/9, DLF City, Phase I, Gurgaon. From his house, respondent No. 2 removed the stocks to the factory, (page 48 annex. “O” rejoinder referred). Stocks were sold at 30 per cent. discount from Aya Nagar first and subsequently from A-22/9, DLF City, Phase I, Gurgaon, his house, at 50 per cent. discount in the name of Chavi Interiors. Stocks from Greater Kailash were also sold from Aya Nagar showroom initially at 30 per cent. discount and subsequently at 50 per cent. discount, in the name of Chavi Interiors. The caretaker of the showroom and one of the employee of the company who was engaged in the said illegal act under the instructions of respondent No. 2, it was pointed out, has given the affidavit. But, the respondent has taken completely new grounds in the written submission. These plea were never raised by the respondent earlier. The pleading of the respondent does not contain these alleged submission. As per legal position, it was contended, no fresh grounds can be raised at the time of final argument. Even otherwise the plea taken by the respondent in their submission, it was contended, is completely false, fabricated and concocted. The respondent has no liberty to raise a completely fraudulent plea with dishonest intention to defeat the legitimate and bona fide claim of the petitioner. The allegation made by the respondent in the written submission is liable to struck down. Respondent No. 2 in deliberately raising the matrimonial dispute to misguide this hon'ble court. Judgment cited by the respondent is not applicable to the facts of this case. All the stocks have been sold under the name of Chavi Interiors, respondent No. 2, has deliberately not maintained any account. The entire money has been siphoned off. Respondent No. 2's mother is impersonating as director. Respondent No. 2 has not stated where the money has been spent. The respondent has not given any information as to what happened to the money received from the debtors. The petitioner has not been paid her salary. In January, 2001, the petitioner had to take up a job to provide a living for herself and her two children. The petitioner has not been allowed to function as director. The matter was reported to the Registrar of Companies, vide letter dated April 23, 2001. No information has been furnished about the stock of the company. A profit making organisation has been reduced to complete shambles. There has been complete oppression and mismanagement. Hence, lift the corporate veil and pass necessary directions under sections 397 and 398 of the Companies Act, 1956.

9. Shri Abhijeet Chatterjee, counsel for the respondents argued that in July, 1991–95 the office of the respondent-company functioned from the premises at C-58, Malviya Nagar, being the office of the father of the petitioner. During this period the workshop was hired for fabrication of furniture at Sheik Sarai. The company entered into a profit sharing agreement with the owner of a commercial/showroom premises at M-Block, Greater Kailash Market. This showroom opened for a period of approximately four years. Due to low volume of turnover the profit sharing arrangement was terminated and the company shifted its showroom in an unauthorised area located at Aya Nagar. During this time fabrication work was being carried out at Devli, Khanpur. It was further pointed out that on November 1, 1997, Shubhra Dutt was inducted as an additional director in the company. Her term expired on September 29, 1998, and she was reappointed as a director in the same annual general meeting which was held on September 29, 1998, and this is reflected in the annual return of the year September 29, 1998, and the same was filed with the Registrar of Companies on August 31, 2000.

10. Counsel for the respondents informed that on 1997/99 the total turnover for the financial years 1997/1998/1999 was Rs. 22 lakhs and Rs. 21 lakhs respectively. The profit after tax was Rs. 61,000 and Rs. 87,000 respectively.

11. Counsel for the respondents pointed out that in January, 2001, without giving any notice to the other directors, the petitioner withdrew herself completely from the affairs of the petitioner-company and took up employment with a company called Tescon Accessories located at Udyog Vihar, Gurgaon. On March 17, 2001, the petitioner took away all her belongings as well as the records pertaining to Chavi Design P. Ltd., and left her matrimonial home, and took up residence of her parental house at B/6/6 D.L.F, Phase-1, Gurgaon, Haryana. On July 30, 2001, the petitioner served a legal notice on respondent No. 2 alleging mismanagement and seeking a declaration that Mrs. Shubhra Dutt is not a director of the company. On November 17, 2001, respondent No. 2 Shri Sandeep Dutt sent a letter to Heema Handa Dutt asking her to resume her participation in the affairs of Chavi Design P. Ltd. The petitioner, however, refused the said offer. In the year 2002, C.P No. 10 of 2002 was filed before the Company Law Board alleging acts of mismanagement and oppression on the part of Sandeep Dutt and Shubhra Dutt. The affairs of the company came to a grinding halt first with the withdrawal of Heema Handa Dutt which led to the closure of design department and then with the demolition by MCD of the premises at Aya Nagar since it was an unauthorised construction.

12. Counsel for the respondents argued that this petition under sections 397 and 398 of the Companies Act, is in fact in the nature of the matrimonial dispute between the petitioner and respondent No. 2. The allegations made in the petition do not bring the dispute within the scope and ambit of section 397/398 of the Companies Act. Hence, the same is not maintainable. The petition is also not maintainable for the reason of non-joinder of necessary party. The mother of respondent No. 2 is Mrs. Shubhra Dutt, who was inducted as an additional director of the company in 1997 and after her term expired, she was re-appointed as a director in September, 1998, and in the absence of any procedure to remove her, she continues to be a director. In the legal notice issued by the petitioner, a specific relief has been sought by asking the respondent to publicly declare that Mrs. Shubhra Dutt is not one of the directors of the company. By seeking the relief of declaration, the petitioner, in fact, has admitted to the continuity of tenure as director by Mrs. Shubhra Dutt. The petition itself has serious allegations against Mrs. Shubhra Dutt including that of forgery and misappropriation of company funds. The nature of the allegations made in the petition clearly show that a joint cause of action is being made out against respondent No. 2, i.e, Sandeep Dutt and his mother Mrs. Shubhra Dutt. In the said situation it is a settled principle of law that the person against whom the allegations have been made must be given an opportunity for defence. Consequently, unless Mrs. Shubhra Dutt was made a party in the proceedings, the present petition has to be dismissed for non-joinder of necessary parties. On the question of impleadment, it has been held in Gillette International… v. R.K Malhotra & Ors.…, [1998] (1) Cal. L.T 371, 379, that “while it is true that Order 1, rule 10 though strictly cannot be said to be applicable in a proceeding before the Company Law Board, the principles analogous thereto can be adopted by the Board for proper and effective adjudication of the pending dispute”. Order 1, rule 10 of the Code of Civil Procedure (“CPC”) provides for the impleadment of necessary parties, if the court is satisfied that there has been a bona fide mistake, and that it is necessary for the determination of the real matter in dispute so to do, order any other person to be substituted or added. Order 1, rule 9 provides that a will fail on ground of non-joinder of a necessary party. The respondent herein had filed an application at the very start of the proceedings under rule 9 of the Companies (Court) Rules read with Order, 1 rule 10, of the CPC seeking dismissal of the petition for non-joinder of Mrs. Shubhra Dutt as a necessary party. This application has been heard along with the main petition, however, a submission has been made to dispose of the same as a preliminary issue to ensure complete justice between the parties. It was argued, that the petitioner, who has been served the copy of this application, is fully aware that Mrs. Shubhra Dutt is a necessary party and has wilfully neglected to implead her. In the circumstances, there is no option but to dismiss the petition on this ground alone.

13. It was further argued by counsel for the respondents that the allegations of mismanagement against respondent No. 2 are false, frivolous and baseless. The primary function of the present company is to plan, design and execution of interior design projects of both commercial as well as residential premises. Being essentially a family run business, the skill of professional design is vested with the petitioner who has studied design at the Doshi School of Design at Ahmedabad. The company has no other professional designer as an employee and the respondent has received no formal training of this nature. In effect the abrupt withdrawal of the petitioner from the affair of the company led to a halt in the working of the company. The petitioner, who was fully aware of the negative consequences of her act has done so wilfully and out of spite and vengeance against respondent No. 2. It is the petitioner, who is thus responsible for serious acts of oppression and mismanagement. It was pointed out that the petitioner withdrew from the affairs of the company in January, 2001, to take up with a company dealing in fashion accessories at Gurgaon. The respondent had learnt that the petitioner in association with Deepak Malhotra had made out an alternate business plan by which she has planned to set up a competing company which would draw upon the cliental and goodwill of Chavi Design, this alone is an act not only of oppression but amounts to unethical business practice.

14. Counsel for the respondent contended that the scope and object of the sections 397 and 398 of the Act is to resolve any deadlock and take such steps which would ensure a smooth functioning of the company. In fact, the nature and purpose of the legislation is entirely in the welfare of the company and its shareholders. My attention was drawn to the petitioner's averment in the petition, “it is submitted that it is not possible for the petitioner and respondent No. 2, who are the only directors of respondent No. 1-company to work together on account of acrimony between them”. It was contended that the petitioner has no interest left in running the company with respondent No. 2. Clearly, sections 397 and 398 of the Act cannot be applied in the present circumstances for the welfare of the company. The allegations of mismanagement and oppression, it was argued, have been made only after the petitioner withdrew from her matrimonial home. The petitioner and respondent No. 2 have continued in the business for the last 11 years and during this time no allegation of any kind was made against the respondent by the petitioner. It was only on account of the breakdown of the matrimonial relationship that has given rise to this ill conceded petition.

15. Counsel for the respondents argued that in the matter of Ramesh Bhajanlal Thakur v. Sea Side Hotel P. Ltd., [2000] 100 Comp Cas 117, this hon'ble Board had the occasion to deliberate on the issues of scope of relief that can be granted under sections 397 and 398 of the Companies Act. It was pointed out that in a well reasoned order, it has been held that (headnote) : “the settled principle of law in the proceedings under sections 397 and 398 of the Companies Act, 1956, is that the relief sought should be to put an end to the acts of oppression/mismanagement and not for any oblique purpose”. The judgment has also dealt on the effect of irresponsible allegations as well as non-impleadment. The similar position it was argued has also been taken in the matter of Pahlaj Dhanjandas Bajaj v. Microedge Technologies P. Ltd., [2000] 27 SCL 473 (CLB).

16. It was further argued that it has been averred in paragraph 15 of the rejoinder affidavit filed on behalf of the petitioner that the petitioner was prevented from conducting business as a director of Chavi Design P. Ltd., at the showroom at M-52, Greater Kailash-I and at Aya Nagar, Main Road, it has also been alleged that Shubhra Dutt and respondent No. 2 in collusion have disposed of stocks at low price from the above addresses, it was pointed out that the petitioner herself has signed all despatch documents including sales invoice, bills and vouchers. She has also signed the statutory documents like sale tax forms, challans and returns. Further, the period during which the said company was operating at M-52, Greater Kailash-I was during the year 1995–99, at this stage the petitioner was in complete charge of the affairs of the company and found no reason then to complain of such alleged acts of mismanagement and oppression. The petitioner herself has signed all vouchers, despatch documents, bills, sales tax returns, etc., and, hence, is fully responsible for the functioning of the company. In the circumstances, it was argued that all allegations made against two directors, i.e, respondent No. 2 and Mrs. Shubhra Dutt are patently false and baseless. Further, it was pointed out that the annual profit of the company has never exceeded Rs. 1 lakh. The petitioner, who is a qualified interior designer had become disillusioned with the low returns in the business and, hence, left the company at the first available opportunity. It was argued that it is co-incidental that this decision was also made on account of the deteriorating matrimonial relationship between the petitioner and respondent No. 2 leading to acrimony and friction. In these circumstances, the petitioner had lost all interests in the affairs of the company and has filed this petition only with the sole purpose of pressurizing respondent No. 2 into accepting inconsolable terms for granting divorce. The real purpose behind this petition, it was stressed is not the welfare of the company but the satisfaction of harassing respondent No. 2.

17. Further, counsel for the respondents argued that as regards cash withdrawals are of Rs. 50,000 and another of Rs. 1,40,000. It is pointed out that these were routine withdrawals to meet the day-to-day running expenses of the company as well as the payment to creditors. The petitioner herself had made similar withdrawals earlier. Hence, the same does not amount to misappropriation. The allegation of disposal of stocks valued at Rs. 10 lakhs is also baseless. The main asset of this company being the designed content, the stock by way of furniture, etc., was very limited and most of it was damaged during demolition of the Aya Nagar showroom. From the facts of this case, it was argued, it is evident that the present petition is vitiated purely on account of the ongoing matrimonial dispute. It was argued that neither the averments made in the petition nor the reliefs sought by way of prayer are within the scope of sections 397 and 398 of the Companies Act which are specifically directed to resolve deadlocks/disputes arising out of company matters and cannot be used to resolve any other differences of personal nature between the directors including that of a matrimonial dispute as is the case herein.

18. In this case the petitioner has sought winding up of the company and appointment of the liquidation officer requiring respondent No. 2 to restore the amounts siphoned off from respondent No. 1's account. The petitioner's case is that respondent No. 2 has not been functioning in the interest of respondent No. 1, he has sold stocks at discount and pocketed the sale consideration; he has manipulated the accounts of respondent No. 1 to his advantage; he has not furnished the requisite statements and annual returns to the Registrar of Companies for more than five years; he has appointed his mother as additional director/director in violation of section 252 of the Act, as after the petitioner was forced to leave, he was the only director left with respondent No. 1; his oppressive conduct not only made her leave respondent No. 1 but her matrimonial home as well; due to his mismanagement and siphoning off funds a profit making company has been reduced to shambles. The respondent's case is that due to matrimonial discord the only interior designer professional wife has herself withdrawn from respondent No. 1 leaving respondent No. 1 and respondent No. 2 in the lurch to desire sadistic pleasure to teach respondent No. 2 a lesson and derive better terms for herself in the ongoing divorce proceedings; her withdrawal from respondent No. 1 out of personal spite and vengeance has had very negative consequences of her act on the conduct of the affairs of respondent No. 1; she has joined hands with Shri Deepak Malhotra making alternate business plan setting up a competing company which would draw upon the clients and the goodwill of respondent No. 1, this is an unethical business conduct on the part of the petitioner; the petition is not maintainable, it has been filed to settle personal scores, matrimonial discord cannot be a ground for attracting the provisions of sections 397 and 398 of the Act, the petition has been filed with an oblique purpose; before the matrimonial discord started, the petitioner had never complained about the same state of affairs of respondent No. 1 and respondent No. 2 and the statements and annual returns filed with the Registrar of Companies were signed by the petitioner herself, she was in complete charge of the affairs of respondent No. 1-company.

19. Respondent No. 1-company was incorporated by husband and wife as the only two directors. The business of respondent No. 1 depended solely on the innovations of a highly professional interior designer, wife as the head and brain of the company. On consideration of the facts and circumstances of the case, I find that the matrimonial discord between the two directors has eaten into the vitals of respondent No. 1-company. Considering the pleadings and the documents filed therewith as well as the arguments of counsel for the parties, it cannot be denied that the matrimonial discord is the root cause of this petition. But at the same time it is a composite petition having allegations of oppression, mismanagement including siphoning off of funds and breach of fiduciary relationship prejudicial to the interest and health of respondent No. 1 as well. It is true that it is not possible to separate the human aspect of disharmony in the personal relationship between the directors which has led to the deadlock and the ill health of an earlier profit making company. It is a fact that there is a deadlock. Cause is known—matrimonial discord. And may be even spite and negligence which cannot be ruled out. But the preliminary objections raised in the case cannot be sustained. The case of oppression and mismanagement under sections 397 and 398 of the Act has been made out. Personal cruelty in the relationship has lead to compelling circumstances of the wife director to withdraw from her successfully established business to look for another job to fed for herself and her two children. It is not an easy and painless decision. Driving an almost indispensable director out of the company resulting in the deadlock is itself an act of oppression. For the purposes of sections 397 and 398 of the Act, oppression may be an act of cruelty, severity, defaulting of will or excessive use of authority. It is unfortunate, but it is true that the personal relationship of the directors has affected the functioning of respondent No. 1-company. It is humanly impossible to exclude and detach the personal relationship when personal life and business are mixed up and intricately linked. The respondents preliminary objections as regards the misjoinder of the parties cannot be accepted in view of the fact that the appointment of respondent No. 2's mother as additional director/director is in violation of section 252 of the Act and is illegal and in contravention of the provisions of the Act. An illegal act cannot generate legal rights. However, during the arguments the counsel for the petitioner did not insist on relief qua respondent No. 2's mother, her main allegations being against respondent No. 1 and respondent No. 2. As regards the petitioner joining hand with another person in the competing business alleged to be an unethical business practice affecting the clients and the goodwill of respondent No. 1, the allegation is merely a bald allegation, no case is made out, what else can a professional interior designer do other than that to earn a livelihood for herself and her two children is also not understood. Respondent No. 2 has failed to appreciate the constraints of her choice.

20. In view of the foregoing, I find that the respondents have failed to meet the allegations on merits of the case under sections 397 and 398 of the Act. The manipulation of accounts of respondent No. 1, siphoning off of discount sale consideration and non-furnishing of the statements and annual returns to the Registrar of Companies for several years are all acts of oppression and mismanagement in the conduct of the affairs of the company. Since there is a deadlock in the company, the petitioner has expressed her inability to be in respondent No. 1's business in the circumstances of this case, parting ways may be good for the general health of respondent No. 1.

21. It is also a settled proposition of law that the fiduciary capacity within which directors have to act enjoins upon them a duty to act on behalf of the company with utmost care and skill and due diligence and in the interests of the company. They have a duty to make full and honest disclosure to shareholders regarding all important matters relating to the company. In some respects, directors resemble trustees and equity prohibits a trustee from making any profit by his management, directly or indirectly.

22. The directors who so use their powers as to obtain benefits for themselves at the expense of the shareholders, without informing them of the fact, cannot retain those benefits and must account for them to the company, so that all the shareholders may participate in them. In the present case the fiduciary duties have been breached by both the parties—by the petitioner as well as by the respondents. Both the parties have indulged in acts in the conduct of the affairs of the company which have been prejudicial to the interests of respondent No. 1.

23. Objects and purpose of sections 397, 398, 402 and 408 of the Act is two fold—to set right the wrongs and take remedial action to prevent occurrence of wrongs in future. Thus, both preventive and curative action can be taken by the Company Law Board to regulate the conduct of the company's affairs in future and to bring to an end the matters complained of. To do substantial justice between the parties, I hereby direct respondent No. 2 to restore the sale consideration received in respect of the discounted sales and other amounts siphoned off from respondent No. 1-company's accounts forthwith. Since there is a deadlock in respondent No. 1, and since both the parties know the worth of the company, I hereby direct the parties to arrive at an amount to be paid to the petitioner for her going out of the company which would be acceptable to the petitioner. In case no such acceptable consideration is arrived and paid to the petitioner within a month of receipt of this order, I consider it appropriate to direct that both the parties to be present in the Company Law Board court room along with their counsel on August 23, 2007, at 11.30 a.m, to bid for the shares and the party which bids the higher price for the shares, should purchase the shares of the other party at that price.

24. With the above directions, I dispose of the petition, keeping seisin over the matter till the finalisation of the bidding, if required. All CAs stand disposed of. All interim orders stand vacated. No order as to costs.