Shri Vijay Kumar Chopra, Smt. Vs. Smt. Sudershan Chopra and ors. - Court Judgment

Excerpt:
1. m/s hind samachar limited (the company) was promoted and incorporated in august, 1949, by one late shri jagat narain. it took over the publication of urdu daily newspaper "hind samachar" started by late jagat narain. he had two sons- ramesh chander and vijay kumar chopra who jointly carried on the business of the company along with their father. late shri jagat narain was a freedom fighter and was actively involved in the freedom movement. in 1965, the company started a new hindi newspaper in the name of "punjab kesari". in 1978, publication of a daily punjabi newspaper "jag vani" was started. these papers were being published from jalandar where the registered office of the company is located. in 1981, jagat narain was assassinated by terrorists. after the death of late shri jagat narain, shri ramesh chander took over as the chief executive of the company and chief editor. he was also assassinated by terrorists in may, 1984 where after the second son, the 1st petitioner, shri vijay kumar chopra took over as cmd and chief editor. in 1983, delhi edition of punjab kesari came into being. in 1991, a new unit was set up in ambala for publishing "punjab kesari". a facsimile edition of delhi edition of punjab kasari started from jaipur. thus, presently, there are 4 units in the company, each having its own publication. late ramesh chandar is survived by his wife, the ^st respondent and two sons- the 2^nd and 3^rd respondents.vijay kumar chopra, his wife and two sons are the petitioners.presently, both the groups have equal shareholding of 49.1% shares each and equal representation of 4 directors each on the board of the company. both the groups entered into a memo of family settlement dated 25^th june, 1995 which was further improved upon by another agreement dated 6^th may, 1996. thereafter, a shareholders' agreement was entered into on 8^th feb. 1997 and the articles of association of the company were amended on 6.12.1997 to substantially incorporate the terms of the shareholders' agreement. in this agreement/articles, the petitioners' group is styled as "group b" and the respondents' group as "group a" and the company was being managed in terms of this shareholders' agreement. a board meeting was convened on 28th november, 1998 to consider various items of businesses. 3 however, due to certain disputes with regard to the transaction of businesses, the meeting came to an end where after no board meeting of the company has been convened till today.2. this petition has been filed by the petitioners seeking for various reliefs on the main ground of deadlock in the management of the company. since the company is essentially a family company, this bench had advised the parties to resolve the disputes amicably by dividing not only the company but also all other family businesses and assets equally so that there was a complete parting of ways between the two groups. the petitioners were to prepare two equal lots and the respondents were to have the first choice of picking up one lot.accordingly, in the hearing held on 14.2.2000, the petitioners gave a proposal of dividing the assets and businesses of the company into two lots- the first lot containing the jalandar and ambala units and the second lot containing delhi and jaipur units. this matter was considered in a few subsequent hearings but the respondents did not choose to exercise their option. instead, they filed an application under section 8 of the arbitration and conciliation act, 1996 on the ground that the shareholders' agreement and also the articles provided for arbitration in case of disputes between the two groups. this application was dismissed by a detailed order dated 8^th december, 2000. this order was taken on appeal before punjab & haryana high court which dismissed the appeal on the ground that there was no statutory appeal provided against an order under section 8 of the arbitration act. thereafter, the respondents filed a writ petition challenging the order of this bench which was dismissed. this order of the high court was again appealed against before the division of the same high court which dismissed the appeal. slp filed before the apex court was also dismissed. in view of the pendency of the appeal proceedings, the matter could be heard finally only during the last part of 2003 and the order could not be issued earlier as the high court had directed that while the matter could be heard by this bench, final order should not be passed till conclusion of the appeal proceeding. 1. the respondents prevented release to payment to contractors in respect of palampur unit of the company and prevented the construction of building there; 2. respondents 1 to 3 did not act in letter and spirit to the understanding and the agreements between the parties and they are maintaining extravagant and luxuries life style and that the 2^nd respondent hobnobs with politicians. 3. the respondents have created n deadlock in the administration of the company by not adhering to the terms of the shareholders agreement and articles; 4. the respondents are demanding 21 days notice for board meetings as against past practice of informal board meetings. 5. the respondents are holding the company to ransom by not allowing the board to comply with statutory requirements; 6. the respondents are questioning the appointment of certain non key personnel by the cmd and they are threatening the employees ; 7. the 3^rd respondent had taken away the attendance register of staff and is allowing employees to mark attendance for several past days at one time leading to indiscipline among the staff and workers and creating problems in completing salary charts, leave records etc. 8. the respondents are adopting an obstructive and destructive approach due to which the jaipur project has not taken of. 9. due to the deadlock created by the respondents, annual accounts have not been finalized resulting in non renewal of bank limits. 10. respondents are obstructing transfer of funds and are refusing /delaying signing of letters to be submitted to banks 11. respondents are trying to meet their personal expenses from the imprest amount 12. due to the acts of the respondents, penalties have been imposed on the company for non payment of esi/pf dues. 13. the respondents have created a parallel hierarchy and the employees are being harassed, humiliated etc. 14. 2^nd respondent has indulged in gross and wasteful expenditure at the cost of the company. 15. the respondents created deadlock in the board meeting held on 28.11.1998 by insisting on consideration of 7^th item in the agenda relating to custody of property deeds and 8^th item relating to appointment of employees with joint consultation, first before taking up any other item even though the petitioners desired to have all the items be taken up for consideration sequentially. in view of this, there is a deadlock in the company and no board meeting has been held thereafter.4. on the basis of these allegations, the petitioners have sought for removal of the respondents 1 to 3 as directors of the company or to restrain them from acting or taking any decision in their capacity as directors of the company or directing the division of the company equally between group 'a' and group 'b' so as to bring to an end the matters complained of.5. shri mookherjee appearing for the petitioners submitted: the company is a family company, each group holding 49.1% shares and having equality on the board. when shri jagat narain and shri ramesh chander were alive, there were no disputes in the family. the disputes started only in 1994, which resulted in a memo of family settlement dated 25.6.1995 between the two groups. till then, irrespective of the shareholdings, the company was being managed as if both the groups held equal shares. just before the family settlement dated 25.6.1995, parity in the shareholding between the two groups was brought about not only in the company but also in other partnership firms. since disputes continued even after this memorandum, another agreement was entered into on 6.5.1996. both these agreements not only dealt with the affairs of the company but also other family matters. thereafter, a detailed shareholders' agreement was entered into between both the groups on 8.2.1997 exclusively concerning the affairs of the company. the various clauses in the agreement would indicate that the company is nothing but a family company ensuring that there is always equal shareholding and equal management. the terms of this agreement have been incorporated in the articles and a reading of the various articles would indicate that company is to be jointly managed by both the groups with equal shareholding and equal participation in the management. even the articles provide for succession by seniority without any outside interference. the various articles also provide for two affirmative votes from each group on various important matters. therefore, unless both the groups cooperate with each other, there would be a deadlock in management. since the company is a closely held family company, deadlock situation is a justifiable cause to invoke the provisions of sections 397/398.6. the learned counsel further submitted: the first petitioner has been actively participating in the business of the company even when his elder brother - the head of group 'a' was alive. since the elder brother was active in politics, the entire management was with the first petitioner. the company has progressed only because of the efforts put in by the first petitioner and this was recognized by late shri ramesh chander himself as is evident from annexure p-1 which is a copy of an article written by ramesh chander and published in the indian press in 1974. his active participation in the affairs of the company as early as 1982 and the confidence the board had in him is evident from the minutes of the board meeting dated 3.2.1982, 1.8.1983, 20.6.1985 etc (annexure p-33). in recognition of his service to the nation, the 1^st petitioner was awarded padma shree.7. he further submitted: the company convened a board meeting on 28.11.1998 to transact various businesses including approval of draft balance sheet and directors report as at 31.3.1998. in that meeting, the second respondent brought an attendance register for the signatures of the directors present. normally, the directors used to sign in the proceeding book itself and not on any separate attendance register.thereafter, the second respondent demanded discussions on items 7 and 8 of the agenda first before taking up any other item. item no. 7 related to custody of registration deeds of the properties of the company.while group 'a' wanted joint custody, group 'b' suggested custody of the deeds be equally divided and shared between the two groups. item no. 8 related to modalities to be followed for appointment of employees of the company and various other related personnel matters. while group 'a' desired that all appointments should be made jointly by one signatory each of both the groups, group 'b' suggested that while there could be a joint consultation between both the groups, yet, for ensuring maintenance of discipline, the letters of appointment should be signed only by the cmd. the second respondent insisted that unless both these issues were considered first, the other issues should not be taken up for consideration. the petitioners suggested that these contentious issues could be taken up after all other items on which there were no disagreement, more particularly after approval of the balance sheet and the directors' report. however, respondent directors were not willing to do so and walked out of the venue of the meeting along with the new attendance register. therefore, the meeting was adjourned by a week in terms of the articles. on 2^nd december, 1998, the petitioners sent a communication to the respondent directors stating that the meeting had been adjourned to 5^th december. in that letter, they had also indicated that in terms of section 210 of the act, the accounts had to be approved by the general body before 31^st december, 1998. in response to that letter, the respondents sent a telegram stating that they had not walked out of the meeting but the meeting was adjourned sine-die. they had further stated that future board meetings should be called only at the convenience of all the directors. on 5^th december, 1998, the meeting was held but none from the respondents' side was present due to which there was no quorum and therefore the board decided to convene an emergent meeting of the board on 8^th december, 1998 to approve the accounts for the year 31^st march, 1998 and fix 31^st december, 1998 as the date for holding the agm and the respondents were requested to waive 21 days prior notice.however, the respondents did not agree for waiving the notice and did not agree for holding the meeting on 8^th dec. thereafter the petitioners sent a 21 days notice calling for a board meeting on 31^st december, 1998 to approve the audited balance sheet and the directors' report and also for fixing the date for the agm. the respondents did not attend the meeting on 31^st december and therefore the meeting was adjourned for a week and the respondents were advised by a telegram. on 7^th jan. 1999, all the 8 directors were present. in this meeting, respondents 1 to 3 refused to allow any items on the agenda to be discussed till their demand relating to joint possession of the title deeds and their demands relating to the appointment of personnel were met with. in view this adamant stand taken by the respondents, no business could be transacted. in terms of article 122(e), only appointment of key personnel required the approval of two members from each group and all other appointments were to be made, in the normal course, by the managing director. therefore, there was no obligation on the part of the md to consult group a in regard to the appointment of non key personnel. since the respondents insisted that all appointments, irrespective of whether the same related to key personnel or non key personnel should be done by both the groups, this matter was included in the agenda as item no. 8 for discussion in the board. .however, with a view to create a state of deadlock, the respondents desired to discuss this matter first, while the petitioners suggested that this contentious issue could be taken up after approval of the balance sheet and fixing the date for the agm. it was important because, in terms of article 89(c) all the directors have to be elected every year and as such their term of office was to expire on 31^st december, 1998.8. the learned counsel further submitted: when the 1^st petitioner in his capacity as md appointed 3 non key personnel, the 2^nd respondent objected to the same by a letter dated 4^th jan. 1999 ( annexure 'r') stating that these appointments were null and void and copies of this letter were sent to the three appointees also. all these three personnel were appointed as trainees and therefore article 122 (e) did not apply to their appointments. these appointees were even verbally threatened that they should not attend office. the 3^rd respondent issued an office order that no new individual was to be enrolled as an employee and no benefit should be extended to them unless his appointment was backed by a proper board resolution. because of the destructive approach adopted by the respondents and on account of the deadlock created by them, many of the projects could not be completed and the banks are not renewing working capital limits because of non adoption of the balance sheet as on 31^st march, 1998.9. referring to ca 57 of 2001, the learned counsel submitted: the company is a debt free company. however, the respondents opened a new bank account in janak puri branch of icici bank and took a loan of rs. 74.81 lacs for purchase of cars. such an action is in violation of article 58 according to which there should be two affirmative votes from both groups 'a' and 'b' for borrowing money. further, article 122 (c )(4) specifically provides that borrowing exceeding an aggregate of rs. 10 lacs at any single instance would require two affirmative votes of each group 'a' and 'b'. the respondents have bought 11 cars for a total consideration of rs. 76 lacs for their personal use. the company already has 42 vehicles and therefore there was no need to purchase new vehicles and it was done only for their personal use. as per the articles, all bank operations are to be carried on with joint signatures of one person each from group 'a' and group 'b'. however, in respect of this account, the 2^nd respondent is the sole signatory.even in the resolution furnished to the bank for opening the bank account, it is shown as if the board had approved the opening of this current account. in fact, no board meeting had taken place after 7^th january, 1999. thus, the respondents have produced a false board resolution to the bank. by a letter dated 17.2.2001 ( annexure -'a-12'), the bank sought for from the company, post dated cheques towards repayment of the loan and by a letter dated 7^th march, 2001, the 1^st petitioner had to inform the bank that the loan obtained was without the permission of the board of directors and as such was not binding on the company. therefore, the entire transaction was done by the respondents without the knowledge, consent and approval of the board of directors which is a grave act of mismanagement.10. referring to ca 175 of 2000, the learned counsel submitted: the respondents, in the guise of promotional schemes of certain products, have allowed advertisements to be published free of cost. by doing so, the respondents are causing a loss of rs. 1 lac for each such advertisement. such publication of free advertisements is without the consent of the petitioners and wholly unauthorized and illegal. they are also shifting equipments from jaipur to delhi unit and are also disposing of the equipments with a view to illegally enrich themselves.further, they have been debiting company's bank account for meeting personal expenses on personal credit card, thus, misappropriating the company funds for personal benefits. because of their non cooperation in making payment for the land at gurgaon, the allotment of land in favour of the company has been cancelled. likewise, in spite of the consent order passed by this board, the respondents did not cooperate with the petitioners in making payment for the land at chandigarh due to which not only the allotment of land could be cancelled, even the amount of rs. 2.85 crores paid earlier could also be forfeited. in addition to these prejudicial acts against the interests of the company, the respondents are also not managing delhi unit properly. the circulation of punjab kesari, delhi has come down drastically. the jalandhar edition, in view of the reduction of cover price has increased its circulation and the revenue is substantially going up.the profits from delhi unit is minimal. this would indicate that the respondents are mismanaging the affairs of delhi unit.11. summing up his arguments, the learned counsel submitted that the respondents are guilty of siphoning of funds of the company, responsible for the deadlock and are mismanaging the affairs of delhi unit. there is complete loss of trust between the two groups and it is impossible to carry on together. since the parties themselves have agreed in the family agreements, shareholders' agreement and in the articles that in case of deadlock, there should be equal division between the two groups, there should be a division of the business and assets of the company. the division should be directed in such a way that the units controlled by each group continue to be with the same group after division. as a matter of fact in the writ petition filed by the respondents in punjab & haryana high court against the order of the provident fund authorities attaching the bank account of the company at delhi, the respondents themselves have averred that they have no connection with jalandhar and ambala units which are under the control of the petitioners. further, even before this bench, the respondents had agreed for division. even otherwise, as this board has done in a number of cases of deadlock in family companies, this board can, on its own, order division with a view to put an end to the matters complained of. even though the petitioners had prepared two lots initially with the first choice of selection with the respondents, now the petitioners should be allowed to retain ambala and jalandhar unit and respondents can have delhi and jaipur units and the difference, if any, between the two, can be ordered to be compensated in cash.12. shri tikku, sr. advocate, appearing for the respondents submitted: even though it is admitted that company is in the nature of a partnership and a family company, yet, the petition does not disclose any ground for grant of relief sought for. the petitioners have tried to strengthen their case on the basis of subsequent events which is not permissible. it has been repeatedly held that the court must confine itself to the case made out in the petition and to the allegations made therein and not to look at other evidence with regard to events that might have happened subsequent to the petition. (subhash chand aggarwal v. associated limestone ltd -92 cc 525 clb: p.s. offshore inter v.bombay offshore suppliers - 75 cc 583 bom: mohta bros p ltd v. calcutta landing -40 cc 119 cal: rajahmundry electric supply corporation ltd v.a. nageshwara rao- air 1956 sc 213) . till 1996-97, as is evident from the annual report for that year, the company was being managed jointly by both the groups and there was never an allegation of either oppression, mismanagement or deadlock. the disputes started only when the petitioners began acting in breach of the terms of shareholders' agreement and articles. the petitioners have projected as if there had been disputes between the two groups for a long time and that was the reason why the family settlements dated 27^th june, 1995, 6^th may, 1996 and shareholders agreement dated 8^th feb. 1997 were entered into between the two groups. there were no disputes earlier. all these agreements were entered into not because there were disputes but with a view to ensure smooth and uninterrupted functioning of the company with equal rights and representation in the management of the company and to eliminate outside influence on the members of both the groups. after the terms of the shareholders' agreement were incorporated in the articles, the petitioners did not comply with many of the provisions of the articles. article 12 clearly provides that if a person from one group is cmd, a person from the other group shall be jmd and joint editor. presently, the 1^st petitioner from group b is the cmd and editor-in -chief and therefore one of the respondents from group a should have been appointed as jmd and joint editor. however, so far the group b has not agreed to appoint jmd from group a. article 14.2 requires 21 days notice for board meetings but such notices are not given for board meetings. as per article 13, all key appointments are to be approved by 3/4^th majority of the board with at least two affirmative votes of each group and this provision is not being followed in making appointments. the alleged deadlock in the board meeting held on 28.11.1998 arose only because one of the agenda items therein was to appoint a joint managing director from group a which group b did not wish to proceed with. in that meeting, the respondent directors desired that all the agenda items should be taken up chronologically but with a view to avoid item no. 5 relating to the appointment of jmd, the petitioners' group insisted consideration of only items relating to approval of accounts and fixing a date for the annual general meeting. it is wrong on the part of the petitioners to complain that the respondents insisted on discussion only on appointments and custody of title deeds. under the bogie of approval of accounts, the petitioners adjourned the meeting and then called for a fresh board meeting notwithstanding the fact that they had already sought for approval from the roc for extension of time to hold the agm.therefore it is petitioners who created a deadlock in the meeting held on 28.11.1999. all along the respondents were only trying to enforce the terms of the articles which according to the petitioners is an act of oppression. the petitioners have always been insisting on continuing past practices which no longer hold good after the articles of the company have been amended. a scrutiny of the various allegations in the petition would indicate that none of the allegations would warrant the winding up of the company on just and equitable grounds. till 1995, it is the respondents who held majority shares. only in the year 1995, 0.33% shares were transferred to the petitioners' group with a view to bring equality in the shareholding. when shri ramesh chander was alive, the 2^nd respondent joined the company as the general manager and it was he, who was responsible for establishing the delhi unit. under his control and guidance, punjab kesri delhi became the largest selling hindi newspaper in delhi. the 3^rd respondent joined the company in the year 1984-85 in the advertising department and was looking after the accounting and financial affairs of the company, lie has been instrumental in mobilizing funds for the company and also computerization and expansion projects of the company including installation of latest machinery needed for a publishing house. he was appointed as a whole time director (finance & commercial) in 1992. the 3rd respondent is actually involved in day to day functioning of the jalandhar unit and therefore it is wrong on the part of the petitioners to claim that the petitioners are controlling the jalandhar unit. the company is a board managed company and since both the groups have equal number of directors, all the decisions regarding the affairs of the company-are being taken jointly. neither of the two groups can take individual credit for the phenomenal (sic) that the company has attained. in addition to this company, both the groups have jointly set up four partnership concerns and one private limited company with equal ownership and management. there is a trust by the name of lala jagat narain charitable trust and the board of trustees comprises of equal number of members and trustees from both the groups. the affairs of these entities are closely linked with the affairs of the company and as such they are inter dependent and intertwined. that is the reason why the respondents, by an application, sought for impleading all these entities also in the present proceedings.13. referring to the counter to the petition wherein the respondents have denied every one of the allegations, the learned counsel submitted: a perusal of the various allegations made in the petition would indicate that these allegations cannot warrant any relief in a petition under sections 397/398 of the act. the respondents have dealt with each one of these allegations in their reply, from which it can be seen that all these allegations made against the respondents are frivolous. till the board meeting held on 28.11.1999, the petitioners never complained about any of the acts of the respondents. the petitioners purposely created a situation of deadlock because they did not want to appoint the 3^rd respondent as the joint managing director which was one of the agenda items numbered as 5. the petitioners actually wanted to first take up item no. 10 and 11 relating to approval of the draft balance sheet as on 31^st march, 1998 and the directors' report while the respondents insisted that all items should be taken up sequentially as per the agenda. therefore, it was decided to adjourn the meeting sine die. however, by a telegram the petitioners informed the respondents that the later had walked out of the board meeting and that a board meeting could be held on 5^th december, 1998 for approval of the balance sheet and accounts. by a written telegram, the respondents informed the petitioners that the former had not walked out of the meeting but the meeting was adjourned sine-die. they had also informed the petitioners that further board meeting could be called for only after ascertaining the convenience of all the directors. however, by a telegram dated 6.1.1998, the petitioners convened a board meeting on 8^th december, 1998 for approval of the accounts for the year ended 31.3.1998 and fix 31^st dec. 1998 as the date for holding the agm. by a telegram dated 7^th dec. 1998, the respondents drew the attention of the petitioners to article 112 (ii), according to which 21 days notice should be given for board meetings and since the notice was short, the board meeting convened on 8^th dec.1998 would be illegal. in view of this, the company issued a notice on 10.12.1998 convening a board meeting on 31^st dec. 1998 wherein the only agenda item consisted of approval of balance sheet, directors' report and fixing of a date for agm. this itself would indicate that the petitioners were not interested in considering any other item as per the agenda for the meeting on 28.11.1998. since the board meeting on 28.11.1998 had been adjourned, all businesses proposed for consideration in that meeting should have been fixed for consideration in the board meeting convened on 31^st dec. 1998. therefore, the respondents did not attend this meeting. by a telegram dated 31^st dec.1998, the 1^st petitioner informed the respondents that since none from respondent side was present in the meeting on 31^st dec. 1998, there was no quorum and therefore the meeting was being adjourned to be held on 7^th january, 1999. on 7^th january, the respondents attended the board meeting and when they asked for the minutes book, attendance register etc., the petitioners refused to produce the same. in view of this, once again the meeting was adjourned sin-e-die. the respondents however suggested holding of another meeting with due notice and that all the agenda items kept for consideration on 28 nov. 1998 should be considered in that meeting. however, by a letter dated 10^th january, 1999, the petitioners once again alleged that the respondents had walked out of that meeting only because items no. 7 and 8 of the agenda for the board meeting on 28.11.1998 were not part of the agenda. the very fact that the petitioners insisted in all the meetings that only items 10, 11 and 12 should be taken up for consideration would indicate that they never wanted to consider item no. 5 relating to appointment of the 3rd respondent as joint managing director. having taken a rigid stand, the petitioners cannot now allege stalemate or deadlock. if the main allegation of the petitioners relates to the alleged refusal of the respondents to attend board meetings, even now the respondents are willing to participate in a board meeting provided an independent chairman is appointed and all the agenda items for the board meeting on 28.11.1998 are taken up for consideration. once it is done, the question of alleged deadlock would no longer survive. it is a settled law that to invoke the provisions of section 397/398, the petitioners should show that there have been continuous acts of oppression or mismanagement upto the date of the petition and that such acts are harsh, burdensome and wrongful. mere lack of confidence between the shareholders would not be sufficient ( shanti prasad jain v. kalinga tube ltd -air 1965 sc 1535: v.m. rao v. rajeswari ramakrishnan - 61 cc 743) 14. the learned counsel further submitted: after filing of the petition and during the proceedings before this bench, the respondents have brought before this bench various acts of mismanagement by the petitioners and seeking for appointment of an administrator. they have been guilty of siphoning of funds, opening of parallel offices in delhi, misuse of company funds by obliging people to their advantage, making key appointments in violation of the articles, adopting unfair labour practices, filing of false cases against the employees etc. it is the petitioners who have been guilty of violation of the provisions of the articles with the view to sideline the respondents. holding the position of chairman and managing director, the 1^st petitioner purposely did not issue any notice for either board meetings or for holding agms. the respondents have always been willing to ensure that all the statutory requirements are- met with. the petitioners, being apprehensive that the respondents would favourably response to the notices for both board meetings and agms, have not been convening these meetings and now they are complaining of deadlock. the petitioners cannot continue to claim that there a is deadlock in the affairs of the company. a solitary instance of an alleged deadlock in a board meeting cannot give rise to a petition under sections 397/398 of the act. from the affidavit filed by the respondents on 29.9.2003, wherein they have given details of various bills, orders to suppliers etc signed by both the groups as late as in 2003, it is evident that there has been joint consultation between the two groups and there is no stalemate. the admitted fact is that there has been phenomenal growth in the progress of the company which was achieved only by joint management by both the groups and no single individual or group can take credit for the same.because of the various acts of the petitioners against the interest of the company, the respondents had to file various civil suits seeking for preventive orders. the petitioners even went to the extent of inspiring third parties closely associated with the company to act against the interest of the company/respondents. for instance, on an complaint made by them, indian newspapers association newspaper society removed the respondents' name from the year book so that they do not contest the election to the representative body of the newspaper. the 1^st petitioner being the chairman and managing director, failed to file pf returns and contribution due to which the pf authorities passed an ex-parte order raising substantial claims against the company and tried to attach the bank account maintained by delhi unit. it is the respondents who initiated appropriate proceedings before the high court of punjab and haryana to protect the interest of the company.15. summing up his arguments, shr tikku submitted: to seek reliefs in a petition under sections 397/398, the petitioners should establish that there have been acts of oppression and that it is just and equitable that the company should be wound up and that such winding up would not be in the interests of the shareholders as held in needles industries case (51 cc 742): world wide agencies p ltd v. margarat t. desor (air 1990 sc 737). none of these requirements is satisfied in this case. the main prayer of the petitioners is to divide the company by which the petitioners want to have full control of jalandhar unit. it is on record that 1.8% shares of the company are held by members of public and therefore without their consent, the assets and business of the company cannot be divided. the company is 52 years old and presently it enjoys a position of command in the national mainstream. it has been possible only because of the joint management. this bench being the court of equity has to keep this aspect in mind before considering any relief sought for by the petitioners. further, a large number of work force is involved. since the only main allegation in the petition relates to board meeting on 28.11.1998 with two different stands taken by the parties on the proceedings of this meeting, as already suggested, a fresh board meeting be called with an independent chairman for consideration of the same agenda items. the respondents undertake to attend this meeting and transact all the businesses. the exercise of powers by this board is discretionary and if an efficacious means of redressal is available to the petitioners, this board should not consider any relief and that only on compelling grounds, the court can interfere with the affairs of a company. (r.s. mathur v. h.s. mathur- 1970 1 clj 35 all). in the same case, it has also been held that the main objective of section 397 is to put an end to the complaints and by directing a board meeting as suggested, this complaint can be put to an end to. even though by various other subsequent applications, the petitioners have made further allegations against the respondents, yet, they need not have to be looked into as the validity of the petition has to be judged on the facts alleged therein and existing at the time of the petition. if the petitioners desire division, let them terminate the shareholders' agreement and seek for specific performance in a civil court. the prayer of the petitioners for division is likely to cause greater prejudice to the company, shareholders and public interest. this bench cannot be a party to such a situation. a remedy proposed and adopted to over come the allegations should not become a source of greater oppression than the one sought to be removed or prevented (mathurs's case-supra). therefore, if at all the petitioners are entitled for any relief, it should be limited to appointment of a permanent chairman with powers to take decisions in the event of any tie in voting, operations and management of the company. he can also be directed to convene a board meeting to transact all the business proposed for the board meeting on 28.11.1998 so that the disputes could be settled in the domestic forum itself.16. in rejoinder, shri mookherjee submitted: it is incorrect to say that there were no disputes among the parties before the board meeting on 28.11.1998. the very fact that there were two family settlements and another shareholders' agreement resulting in amendment to the articles would indicate that there had been disputes. by these agreements, the parties had tried to resolve their disputes domestically but did not succeed. in other words, both the domestic forum and the company forum have failed to end the disputes between the two groups. even the consensual arrangement before this bench had failed. there is absolutely no reason as to why the respondents should object to the division of the assets and business of the company between the two groups when they had agreed to do so in clause 6 of family settlement dated 26.5.1995, clause 3 of family settlement dated 6^th may, 1996 and article 191 of the aoa of the company. further, as is evident from the orders of this bench dated 18.1.2000, 14.2.2000, 22.2.2000, 3.3.2000 and 4.4.2000, both the parties had agreed for division. further, when there is a situation of deadlock and the events indicate that both the parties cannot continue together, even in law, in exercise of powers under section 402 of the act, this bench has the power to order such a division. in vijay krishan jaidka v. jaidka motors pvt. ltd. (1997 1 clj 268), this board had directed division of assets between the two warring groups in a situation of deadlock. similarly, in k.n. bhargava v. track parts of india ltd. (104 cc 611) , this board directed division of even a listed company when two groups of family shareholders holding substantial shares could not carry on business together. further, presently there is practically a de-facto division between the two groups - jalandhar with petitioners' group and delhi with respondents' group. by an order, this de-facto division could be formalized by this bench and any difference in the value of the two could be compensated by cash. the contention of the respondents is that just an impasse in a board meeting does not amount to either deadlock or oppression meriting grant of relief. in the present case, relationship between the two groups has come to such a state that it would be impossible to carry on together. in groz brekert's (83 cc 371) case, when the company law board found that the two warring groups could not carry on together, it ordered parting of ways. the deadlock is evident from the fact that annual accounts have not been finalized and approved either by the board or by the general body right from 1998. the impasse in the board meeting on 28.11.1998 was created by the respondents. their version that since the petitioners were not prepared to take up item no. 5 for appointment of the 3rd respondent as the jmd is not borne out in any of the communications to the petitioners but has been raised only in the petition. in all the correspondences, they were only referring to items no. 7 and 8. when the main statutory responsibility of a company to finalize and pass annual accounts has not been discharged for a number of years, the same would call for winding up of a company on just and equitable grounds as has been held in loch v. john blackwood ltd. (1924 aer rep 200). in that case, the directors had failed to observe statutory conditions as two general meetings, did not submit balance sheets and did not comply with the provisions under the statute. the court held that it was impossible for the minority shareholders to obtain any relief by calling a general meeting and therefore they could apply for winding up on just and equitable grounds. in the present case, both the groups hold equal number of shares and equal representation on the board and therefore one group alone cannot set things right other than seeking winding up of the company on just and equitable grounds which would not be in their interest and that is why alternate reliefs under sections 397/398 have been sought for.17. i have considered the pleadings, arguments and the written submissions of the parties. the allegations in the petition have been summarized in paragraph 3 ante. thereafter, in the rejoinder as well as in applications ca 175/2000 and ca 57/2001, the petitioners have made further allegations on the events that took place after the petition was filed. the respondents had also filed 3 applications making allegations against the petitioners. in ca 294/1999, they sought for appointment of an administrator on the ground of misappropriation of company funds by the petitioners. in ca 7/2000, on the allegations that the petitioners had effected reduction in the cover price of the papers and had reduced the advertisement rates, once again sought for appointment of an administrator. in ca 40/2000, alleging that the petitioners had removed all the records of the company and that they had sold news print and aluminium outside the books and had misappropriated over rs. 70 lakhs, once again sought for appointment of an administrator to supervise and control the day to day working of the company. the learned counsel for the respondents advanced an argument that a petition should stand on its own and subsequent events cannot be considered and on this proposition he cited some cases. in karelda suryanarayanan v. sri ramdass motor transport p ltd (92cc 275), this board had taken the view that there is no bar in subsequent events being brought on record and considered by this board but such consideration would be only to mould the relief to be granted.according to the respondents, the allegations contained in the petition can neither be classified as oppression or mismanagement on the part of the respondents as most of them are frivolous and unsubstantiated as is evident from the detailed reply filed by them.18. this is a case wherein both the sides have leveled allegations against each other not only in the conduct of the business of the company but also personal in nature. the substantive allegation in the petition relates to the board meeting on 28.11.1998 which, inspite of having been adjourned more than once, did not transact any business.both the groups have their own version of that meeting. while the petitioners allege that the respondents were adamant to take up items 7 and 8 first and also wanted that the proposal given by them should be accepted, the respondents allege that with the view to avoid consideration of the item relating to the appointment of the 3rd respondent as the joint md, the petitioners were insisting that matters relating to the accounts and agm should be decided. whatever may be the correct position, the end result was that there was a stalemate and thereafter, no board meeting has been held till now and that accounts have not been adopted in the general meetings. further, in terms of the articles, all the directors hold office only upto the date of the next agm and since no agm has been held from 1998, none of them can legally continue and discharge functions as directors. in other words the basic statutory requirements have not been complied with for over 6 years now. i am of the view that no useful purpose will be served in giving a finding on individual allegations made by each against the other as the same is not going to solve the present stalemate prevailing in the affairs of the company as also in the relationship among the parties.it would rather be appropriate to examine as to whether any remedial measure is possible to ensure that the affairs of the company are carried on in accordance with law and articles. the respondents filed an affidavit dated 29^th september, 2003 stating that there is no deadlock in the company as alleged by the petitioners as even now all decisions regarding infrastructural and input items were being taken jointly by the company, under the joint signatures of one of the members of either group i.e. group 'a' and group 'b'. they have further averred that all input costs, statutory payments etc. are being made jointly and decisions being taken after discussions among directors. to substantiate this averment, they have also enclosed copies of letters of instructions issued to the bank for making payments and also copies of orders place on supplier, all jointly signed by a director from group 'a and a director from group 'b'. when this affidavit was referred to, the learned counsel for the petitioners submitted that there had been no common disbursement like provident fund remittance, salary, bonus, ex-gratia, rental taxes, advertising sales promotion and capital expenditure as from january, 2000 onwards as the parties were not in talking terms with each other. these infrastructural and inputs costs had to be incurred failing which the business of the company would come to a stand still. mere cooperation with each other for the survival of the business of the company does not mean that there is no deadlock. the very fact that there has been no board meeting or agm and that accounts have not been adopted for over 6 years, by reason of the parties being not even on talking terms would indicate that there is a complete dead lock in the affairs of the company. i am inclined with the submissions of the learned counsel for the respondents. the learned counsel for the respondents, relying on kalinga tube and rajeswari ramakrishnan cases (supra) submitted that there should be continuous acts of oppression to warrant reliefs in a petition under section 397/398. even assuming that this petition is based on a single act, that is alleged dead lock in the board meeting on 28.11.98, its effect still continues, in the sense, no further board meetings or agm have been held so far and the accounts have not been finalized for nearly 6 years. thus, there have been continuous statutory defaults due to deadlock. i had to pass an order, at the request of the parties on 1.10.2003 restraining the registrar of companies from taking any further action in terms of the notice issued by him on 19.9.2003 for various statutory defaults committed by the company. further, even after filing of the petition, both the sides have made allegations of mismanagement against each other exhibiting clearly that acts of mismanagement are continuing. shri tiku relied on needles industries and margarat t. desor cases (supra) to state that the petitioners should make out a case for winding up of the company on just and equitable grounds. in cases of dead lock in family companies with equal share holding and equality in management, dead lock situation would warrant winding up of a company on just and equitable grounds and reliefs can be granted in a petition under sections 397/398.(krishanlal ahuja v. sureshkumar ahuja -53 cc 60 del: saboo's case clb(supra):sishu ranjan datta v. bhola nath paper house ltd-53 cc 883 cal: combust technic p ltd re-1993 1 clj cal) 19. the fact that the company is a family company is not disputed and it is also a fact that there are two distinct groups of shareholders, the respondents constituting group 'a' and the petitioners, group 'b'.both the groups hold equal number of shares in the company. they have also by means of two family agreements and shareholders' agreement decided to conduct the affairs of the company jointly with equal representation on the board and with equal powers as is evident from the fact that affirmative votes from both the groups are required for most of the decisions in the affairs of the company. in this connection, it may be relevant to refer to paragraph 7(xiii) of the counter of the respondents wherein they have averred "it is pertinent to state that the success of the company lay in the joint and equal management of group 'a' and group 'b' ". the affairs of the company could be carried on in line with the terms of the articles of association of the company only if both the groups resume their relationship of cordiality and cooperate with each other. each group has made allegations against the other group of siphoning of funds of the company, acting against the interest of the company etc. in addition, both the groups have also brought in the employees of the company into their fight. while according to the 1^st petitioner, he is a bachelor of arts with a diploma in printing and technology from germany and diploma in advanced newspaper management from london, according to the respondents the 1^st petitioner does not possess adequate educational qualification nor any business acumen to hold his position but the same was conferred upon him as the titular head of the family. in page no. 199 of the counter, the respondents have averred "if is stated that the conduct of the petitioner no. 1 in his personal and private life is not worthy of a newspaper editor. the respondents can demonstrate the ill doings of the petitioner no. 1 which have brought ill repute to the newspaper and disgrace to the family". in page no. 132, it is stated "the petitioners do not possess even an elementary knowledge of running a newspaper. they do not have any exposure to sophisticated and modern management and technical operations of india's leading publishing houses. besides they do not even possess even cursory knowledge of journalistic ethics and practices in running a modern newspaper". in the similar vein, the petitioners have averred "the only image that respondent no. 2 has tried and succeeded in building is that of a person who is consistently attending loud, lavish and late night parties".(page 8 of the rejoinder). in page 12 of the rejoinder, it is stated "it is submitted that the respondent no. 3 takes no interest in the working or management of the company. he does not even attend to the role assigned to him. he attends office as per his whims and fancies and that too for a couple of hours a day, if at all, and whatever little attention he does give to the company is only for the purposes of disrupting its affairs and functions. he disappears for months on end on holidays with his family without any leave of absence". in page 67 of the rejoinder, it is stated "the acts are conduct of the respondents has tarnished the reputation of the company and as a result affect the good will of the company which has been built up over the last 50 years. the respondents no. 2 and 3 are not fit persons to be involved in the management of the company". with this sort of acrimonious personal accusations against each other, it is extremely doubtful whether both the groups could continue to jointly manage the affairs of the company smoothly. even for payment of consideration for the chandigarh land, this bench had to hear the parties in a number of hearings and give directions, which, it is learnt have not borne fruit yet. there is complete loss of trust and confidence between the two group as revealed during the hearing of an application filed by the workers' union seeking for a direction to the company to pay bonus/ex-gratia to the employees. this application had to be heard on a number of occasions (application was filed in october 2000 and payment was made in august 2001 after repeated directions) as both the sides doubted the correctness and veracity of the workers list given by both of them in respect of the units under their control. when each group suspects the honesty of the other and makes allegations of siphoning of funds, they can never continue to work together with equal participation in the management. even though, the respondents have taken a stand in the present proceeding that the family agreements were not consequent to any disputes earlier, in the writ petition, they have averred that due to disputes that started in 1994, family settlements were entered into. it appears to me that the disputes which started in 1994 have now become irreconcilable inspite of 3 quick and successive agreements and that the parties have reached a point of no return.20. the respondents have given a suggestion that a board meeting may be convened with an independent chairman to transact the same businesses that were proposed for the meeting convened on 28.11.1998 so that the alleged deadlock can be broken. according to him, relying on r.s.mathur case, if an allegation of deadlock could be put an end to by ordering a board meeting, then no other relief needs to be given. as a matter of fact, the issue of having an independent chairman was considered on 20.8.99, when this petition was mentioned and certain interim reliefs were sought. when this bench suggested that the 4 items on which interim reliefs were sought could be placed before the board with an independent chairman, while the respondents were agreeable, the petitioners were willing only for an observer, which was not acceptable to the respondents. now, with such a long passage of time and in view of the petitioners stand that they would not support the said suggestion, even if the meeting is ordered to be held, it is not going to bear any fruit. further, such a suggestion has come with a rider that a permanent chairman be appointed with the power to take decisions in the event of any tie in voting, operations and management of the company. having a permanent chairman with the ultimate decision making powers, (which suggestion's not acceptable to the petitioners) would straight away defeat the very foundation of the shareholders agreement/articles, which in the words of the respondents "all these agreements were entered into not because there were disputes but with a view to ensure smooth and uninterrupted functioning of the company with equal rights and representation in the management of the company and to eliminate outside influence on the members of both the groups". if these agreements had been entered into with the view to eliminate outside influence, then having a chairman with ultimate decision making power would be destructive to the family nature of the company.therefore, i am of the view that, having an independent chairman for all the time to come cannot be a permanent solution. therefore, parting of ways between the two groups would not only be in the interest of the company, but also to the shareholders and the employees.21. the suggestion relating to parting of ways is not some things new.in all the agreements, there is provision to the effect that in case of disputes among the parties, which could not be resolved amicably, the business of the company would be split equally between the parties. in the family settlement dated 26.5.1995, in clause 6, it is stated "in case of irreconcilable differences on running of business between the two families, way to be found to split the business equally rather than one side trying to oust the other family with outside help or otherwise". similar provision has been made in the agreement dated 6^th may, 1996. the shareholders' agreement also provides in article 22 that in case of termination of the agreement "assets, liabilities, trade marks, trade name and good will of the company will be shared and/or divided between the parties in such a manner that neither party will have advantage over the other party". article 191 of the aoa which reads "in the event of material deadlock in the affairs of the company, whereby parties/major shareholders decide that they cannot work together any more, good will, trade marks, trade name and assets and liabilities of the company will be amicably determined and divided equally amongst parties. it will be the duty of the arbitrators to draw a scheme to see that neither parties gets more advantage over the other party, if necessary, sanction to be obtained from the appropriate authority (court/clb etc.)", also provides for division. besides these specific written provisions, before this bench also the parties had agreed for division of the business of the company. in the hearing held on 18.1.2000, it was agreed that the petitioners would give a proposal in writing to the respondents for amicably settling the disputes.accordingly, in the hearing held on 14.2.2000, the petitioners gave a proposal of dividing the assets and businesses of the company and other family businesses in to two lots leaving the first choice of selection to the respondents. the respondents were directed to react to the same.however, in the hearing held on 22.2.2000, the petitioners desired to make some elaborations without any substantial changes to the proposal given by them earlier and as such they were directed to give the fresh proposal by 7^th march, 2000. in the hearing held on 9.3.2000, the petitioners gave their fresh proposal and the counsel for the respondents desired time to consider the same. in the hearing held on 4.4.2000 also, the respondents sought for some more time to study the feasibility of the division. however, later on, they filed an application under section 8 of the arbitration and conciliation act, which was dismissed. it is evident from this sequence of events that between 18.1.2000 to 4.4.2000, that the respondents did not have any objection to the division of the assets and businesses of the company.therefore, as rightly pointed out by shri mookherjee, when the parties themselves have decided in various documents and in the aoa that in case of deadlock or irreconcilable differences, the only manner of resolving the disputes is by way of division, the same could be ordered by this bench. further, in cases of deadlock or irreconcilable differences among the shareholders in a family company, in terms of section 402 of the act, this board has always directed parting of ways either by sale of shares held by one group to the other or division of business/assets if feasible. in trackparts india case (supra), this board found that it was feasible to divide the manufacturing units in the company between the two groups and accordingly directed division.in the present case, since there are four distinct units of the company with their own publications, it is quite possible to divide the business between the two. that is why even at the initial stage, with the consent of both the parties, the petitioners were directed to prepare two lots dividing the assets and businesses of the company and other family interests into two equal parts. since the petitioners were preparing the proposal, the choice of first choosing the lot was given to the respondents. however, this proposal did not materialize. if it is established that each group is independently managing some units, it would be proper that those units continue to be with the same group at the time of division. in shri prakash nath v. ashoka manufacturing co.pvt. ltd., (111 cc 711) the company had two units and similar to the present case, the shareholders styling themselves as group 'a' and group 'b' were independently managing one unit each for a number of years. therefore this board formalized the informal division by directing each group to manage its own unit independent of the other and thus paved for parting of ways. even though it is the assertion of the petitioners that they are in complete control of jalandhar and ambala units, (without staking any claim on delhi and jaipur units), the respondents assert that they are also part and parcel of the management of the jalandhar and ambala units. in this connection, it is appropriate to refer to the pleadings of the respondents in the writ petition filed by them in punjab and haryana high court. this writ petition was filed by the respondents challenging the order of provident fund authorities directing punjab & sindh bank, town branch, delhi to pay a sum of about rs. 98 lacs from the account of the company maintained in that branch. the writ was filed in the name of the company by the 3^rd respondent, on the ground that the said amount was payable by jalandhar unit of the company and therefore the delhi unit cannot be made responsible for that liability. in the writ petition, it has been averred "the group 'a; rum the delhi and jaipur unit and group 'b' runs the jalandhar and ambala unit. at present the company publishes four newspapers i.e. punjab kesri ( delhi), punjab kesri ( jalandhar), jagbani and hind samachar. the arrangement has been made so that the interest of the groups do not clash and the company can have a smooth running". in paragraph 5 of the said petition, it is stated "however, since the parent company is the same, the formal division has not yet taken place. although the formal division has not taken place, the group 'a' and group 'b' are working total independent entities and have no concern with each other". in paragraph 6, it is stated "the members of group 'a' have no concern whatsoever in the running and management of the establishment at jalandhar. once the group 'a' has not concern with the running and management of the establishment at jalandhar, the group 'a' cannot be penalized for the misdeeds and illegal actions of group 'b'". in paragraph 11, it is further stated "that the petitioner company has been divided into two groups i.e.group 'a' and group 'b'. the group 'a' runs the units at delhi and jaipur and group 'b' runs units at jalandhar and ambala. although the parent company is the same and separate companies have not been formed, the working of group 'a' and group ';b is entirely independent and groups have no concern, whatsoever with each other". these averments in the writ petition clearly indicate that the respondents themselves have recognized that the jalandhar and ambala units are being managed by the petitioners, independent of the respondents. the respondents cannot take one stand in the high court for the purpose of avoiding penal action and take a different stand in the present proceedings that they are jointly managing jalandhar and ambala units, to avoid division.22. therefore, it is evident that the petitioners are in de-facto control of jalandhar and ambala units and the respondents are in control of delhi and jaipur units. in view of this, i am of the view that the disputes between the two groups could be put an end to, which would be in the interest of the shareholders and the company, by division of the business and assets of the company by vesting the jalandhar and ambala units with the petitioners and delhi and jaipur units with the respondents. the respondents have contended that there are outside shareholders having about 1.8% shares and as such without their consent, no division is possible. these shareholders can be given the option of either to going with one group or to get fair value for their shares. in view this, there is no need to get their consent.division of a newspaper company among the family members is not something new. in the matter of indian express news paper, there were disputes among the shareholders resulting in proceedings in madras and bombay high courts. a petition was filed before this board also under sections 397/398. with the persuasion and assistance of this board, the parties therein agreed for division of their interests in the entire express group. southern editions of the group publications went to one group and publications in the rest of india to the other group.23. accordingly 1 direct that there shall be a division of the company with the petitioners taking over the complete control of jalandhar and ambala units and the respondents taking over delhi and jaipur units.this will be along with the respective assets and liabilities identifiable with each unit. all common assets and liabilities will be apportioned equally either in specie if possible, or compensated by cash. the company will be with the petitioners as they will be controlling the jalandhar unit and the respondents may incorporate a separate company with a different name. since both the groups hold equal shares in the company, there has to be equality not only in terms of monetary value but also in all other respects like areas of distribution etc. i find that besides the company, both the groups have equal interest in four other partnership firms, another private limited company and a trust all of which have dealings with the company. in the lots prepared originally by the petitioners, all these entities were also included in the division. since i am directing division of the company with a view to put an end to the state of stalemate and to ensure parting of ways, it is advisable that both the groups agree for complete division of all their interests not only in these entities but also all other assets and properties of the family. i find from the lots prepared by the petitioners that each and every asset/liability of not only the company but also other entities and the family has been covered including territorial division of areas of distribution of different publications. while the first lot includes jalandhar and ambala units, the second lot includes delhi and jaipur units. since the first choice of choosing a lot was with the respondents, it is but natural that the petitioners, while preparing the lots would have ensured equality. this being the case, if the respondents are agreeable to take the 2^nd lot which includes delhi and jaipur units, the disputes would come to an end. otherwise, to ensure equal division, i have to appoint art independent person, preferably, a retired high court or supreme court judge to supervise and complete this exercise.24. accordingly, the matter is fixed for further consideration on 14^th july 2004 at 2.30 p.m. at which time the respondents should indicate as to whether they are willing to take the 2^nd lot as given by the petitioners on 7^th march 2000, or they would like to have the division done equally by an independent person- (with jalandhar and ambala with the petitioners and delhi and jaipur with the respondents). in the later case, both the sides should also indicate whether they are willing for including all the firms as well as other family interests in the division so that there would be a complete parting of ways between the two groups. they will also indicate the name of a retired judge mutually acceptable to both the groups failing which 1 shall appoint one and give further directions.

Judgment:
1. M/S Hind Samachar Limited (the company) was promoted and incorporated in August, 1949, by one late Shri Jagat Narain. It took over the publication of Urdu daily newspaper "Hind Samachar" started by late Jagat Narain. He had two sons- Ramesh Chander and Vijay Kumar Chopra who jointly carried on the business of the company along with their father. Late Shri Jagat Narain was a freedom fighter and was actively involved in the freedom movement. In 1965, the company started a new Hindi Newspaper in the name of "Punjab Kesari". In 1978, publication of a Daily Punjabi Newspaper "Jag Vani" was started. These papers were being published from Jalandar where the registered office of the company is located. In 1981, Jagat Narain was assassinated by terrorists. After the death of Late Shri Jagat Narain, Shri Ramesh Chander took over as the Chief Executive of the company and Chief Editor. He was also assassinated by terrorists in May, 1984 where after the second son, the 1st petitioner, Shri Vijay Kumar Chopra took over as CMD and Chief Editor. In 1983, Delhi Edition of Punjab Kesari came into being. In 1991, a new unit was set up in Ambala for publishing "Punjab Kesari". A facsimile edition of Delhi Edition of Punjab Kasari started from Jaipur. Thus, presently, there are 4 units in the company, each having its own publication. Late Ramesh Chandar is survived by his wife, the ^st respondent and two sons- the 2^nd and 3^rd respondents.

Vijay Kumar Chopra, his wife and two sons are the petitioners.

Presently, both the groups have equal shareholding of 49.1% shares each and equal representation of 4 directors each on the Board of the company. Both the groups entered into a Memo of family settlement dated 25^th June, 1995 which was further improved upon by another agreement dated 6^th May, 1996. Thereafter, a Shareholders' Agreement was entered into on 8^th Feb. 1997 and the Articles of Association of the company were amended on 6.12.1997 to substantially incorporate the terms of the Shareholders' Agreement. In this agreement/Articles, the petitioners' group is styled as "Group B" and the respondents' group as "Group A" and the company was being managed in terms of this shareholders' agreement. A Board Meeting was convened on 28th November, 1998 to consider various items of businesses. 3 However, due to certain disputes with regard to the transaction of businesses, the meeting came to an end where after no Board Meeting of the company has been convened till today.

2. This petition has been filed by the petitioners seeking for various reliefs on the main ground of deadlock in the management of the company. Since the company is essentially a family company, this Bench had advised the parties to resolve the disputes amicably by dividing not only the company but also all other family businesses and assets equally so that there was a complete parting of ways between the two groups. The petitioners were to prepare two equal lots and the respondents were to have the first choice of picking up one lot.

Accordingly, in the hearing held on 14.2.2000, the petitioners gave a proposal of dividing the assets and businesses of the company into two lots- the first lot containing the Jalandar and Ambala units and the second lot containing Delhi and Jaipur units. This matter was considered in a few subsequent hearings but the respondents did not choose to exercise their option. Instead, they filed an application under Section 8 of the Arbitration and Conciliation Act, 1996 on the ground that the shareholders' agreement and also the Articles provided for arbitration in case of disputes between the two groups. This application was dismissed by a detailed order dated 8^th December, 2000. This order was taken on appeal before Punjab & Haryana High Court which dismissed the appeal on the ground that there was no statutory appeal provided against an order under Section 8 of the Arbitration Act. Thereafter, the respondents filed a writ petition challenging the order of this Bench which was dismissed. This order of the High Court was again appealed against before the Division of the same High Court which dismissed the appeal. SLP filed before the Apex Court was also dismissed. In view of the pendency of the appeal proceedings, the matter could be heard finally only during the last part of 2003 and the order could not be issued earlier as the High Court had directed that while the matter could be heard by this Bench, final order should not be passed till conclusion of the appeal proceeding.

1. The respondents prevented release to payment to contractors in respect of Palampur Unit of the company and prevented the construction of building there; 2. Respondents 1 to 3 did not act in letter and spirit to the understanding and the agreements between the parties and they are maintaining extravagant and luxuries life style and that the 2^nd respondent hobnobs with politicians.

3. The respondents have created n deadlock in the administration of the company by not adhering to the terms of the Shareholders agreement and Articles; 4. The respondents are demanding 21 days notice for Board meetings as against past practice of informal Board Meetings.

5. The respondents are holding the company to ransom by not allowing the Board to comply with statutory requirements; 6. The respondents are questioning the appointment of certain non key personnel by the CMD and they are threatening the employees ; 7. The 3^rd respondent had taken away the attendance register of staff and is allowing employees to mark attendance for several past days at one time leading to indiscipline among the staff and workers and creating problems in completing salary charts, leave records etc.

8. The respondents are adopting an obstructive and destructive approach due to which the Jaipur project has not taken of.

9. Due to the deadlock created by the respondents, annual accounts have not been finalized resulting in non renewal of bank limits.

10. Respondents are obstructing transfer of funds and are refusing /delaying signing of letters to be submitted to banks 11. Respondents are trying to meet their personal expenses from the imprest amount 12. Due to the acts of the respondents, penalties have been imposed on the company for non payment of ESI/PF dues.

13. The respondents have created a parallel hierarchy and the employees are being harassed, humiliated etc.

14. 2^nd respondent has indulged in gross and wasteful expenditure at the cost of the company.

15. The respondents created deadlock in the Board Meeting held on 28.11.1998 by insisting on consideration of 7^th item in the agenda relating to custody of property deeds and 8^th item relating to appointment of employees with joint consultation, first before taking up any other item even though the petitioners desired to have all the items be taken up for consideration sequentially. In view of this, there is a deadlock in the company and no Board meeting has been held thereafter.

4. On the basis of these allegations, the petitioners have sought for removal of the respondents 1 to 3 as directors of the company or to restrain them from acting or taking any decision in their capacity as directors of the company or directing the division of the company equally between Group 'A' and Group 'B' so as to bring to an end the matters complained of.

5. Shri Mookherjee appearing for the petitioners submitted: The company is a family company, each group holding 49.1% shares and having equality on the Board. When Shri Jagat Narain and Shri Ramesh Chander were alive, there were no disputes in the family. The disputes started only in 1994, which resulted in a memo of family settlement dated 25.6.1995 between the two groups. Till then, irrespective of the shareholdings, the company was being managed as if both the groups held equal shares. Just before the family settlement dated 25.6.1995, parity in the shareholding between the two groups was brought about not only in the company but also in other partnership firms. Since disputes continued even after this memorandum, another agreement was entered into on 6.5.1996. Both these agreements not only dealt with the affairs of the company but also other family matters. Thereafter, a detailed shareholders' agreement was entered into between both the groups on 8.2.1997 exclusively concerning the affairs of the company. The various clauses in the agreement would indicate that the company is nothing but a family company ensuring that there is always equal shareholding and equal management. The terms of this agreement have been incorporated in the Articles and a reading of the various Articles would indicate that company is to be jointly managed by both the groups with equal shareholding and equal participation in the management. Even the Articles provide for succession by seniority without any outside interference. The various Articles also provide for two affirmative votes from each group on various important matters. Therefore, unless both the groups cooperate with each other, there would be a deadlock in management. Since the company is a closely held family company, deadlock situation is a justifiable cause to invoke the provisions of Sections 397/398.

6. The learned counsel further submitted: The first petitioner has been actively participating in the business of the company even when his elder brother - the head of group 'A' was alive. Since the elder brother was active in politics, the entire management was with the first petitioner. The company has progressed only because of the efforts put in by the first petitioner and this was recognized by late Shri Ramesh Chander himself as is evident from annexure P-1 which is a copy of an Article written by Ramesh Chander and published in the Indian Press in 1974. His active participation in the affairs of the company as early as 1982 and the confidence the Board had in him is evident from the minutes of the Board Meeting dated 3.2.1982, 1.8.1983, 20.6.1985 etc (Annexure P-33). In recognition of his service to the nation, the 1^st petitioner was awarded Padma Shree.

7. He further submitted: The company convened a Board Meeting on 28.11.1998 to transact various businesses including approval of draft balance sheet and directors report as at 31.3.1998. In that meeting, the second respondent brought an attendance register for the signatures of the directors present. Normally, the directors used to sign in the proceeding book itself and not on any separate attendance register.

Thereafter, the second respondent demanded discussions on items 7 and 8 of the Agenda first before taking up any other item. Item No. 7 related to custody of registration deeds of the properties of the company.

While group 'A' wanted joint custody, group 'B' suggested custody of the deeds be equally divided and shared between the two groups. Item No. 8 related to modalities to be followed for appointment of employees of the company and various other related personnel matters. While group 'A' desired that all appointments should be made jointly by one signatory each of both the groups, group 'B' suggested that while there could be a joint consultation between both the groups, yet, for ensuring maintenance of discipline, the letters of appointment should be signed only by the CMD. The second respondent insisted that unless both these issues were considered first, the other issues should not be taken up for consideration. The petitioners suggested that these contentious issues could be taken up after all other items on which there were no disagreement, more particularly after approval of the Balance Sheet and the Directors' Report. However, respondent directors were not willing to do so and walked out of the venue of the meeting along with the new attendance register. Therefore, the meeting was adjourned by a week in terms of the Articles. On 2^nd December, 1998, the petitioners sent a communication to the respondent directors stating that the meeting had been adjourned to 5^th December. In that letter, they had also indicated that in terms of Section 210 of the Act, the accounts had to be approved by the general body before 31^st December, 1998. In response to that letter, the respondents sent a telegram stating that they had not walked out of the meeting but the meeting was adjourned sine-die. They had further stated that future Board meetings should be called only at the convenience of all the Directors. On 5^th December, 1998, the meeting was held but none from the respondents' side was present due to which there was no quorum and therefore the Board decided to convene an emergent meeting of the Board on 8^th December, 1998 to approve the accounts for the year 31^st March, 1998 and fix 31^st December, 1998 as the date for holding the AGM and the respondents were requested to waive 21 days prior notice.

However, the respondents did not agree for waiving the notice and did not agree for holding the meeting on 8^th Dec. Thereafter the petitioners sent a 21 days notice calling for a Board Meeting on 31^st December, 1998 to approve the audited balance sheet and the directors' report and also for fixing the date for the AGM. The respondents did not attend the meeting on 31^st December and therefore the meeting was adjourned for a week and the respondents were advised by a telegram. On 7^th Jan. 1999, all the 8 directors were present. In this meeting, respondents 1 to 3 refused to allow any items on the agenda to be discussed till their demand relating to joint possession of the title deeds and their demands relating to the appointment of personnel were met with. In view this adamant stand taken by the respondents, no business could be transacted. In terms of Article 122(e), only appointment of key personnel required the approval of two members from each group and all other appointments were to be made, in the normal course, by the Managing Director. Therefore, there was no obligation on the part of the MD to consult Group A in regard to the appointment of non key personnel. Since the respondents insisted that all appointments, irrespective of whether the same related to key personnel or non key personnel should be done by both the groups, this matter was included in the agenda as item No. 8 for discussion in the Board. .

However, with a view to create a state of deadlock, the respondents desired to discuss this matter first, while the petitioners suggested that this contentious issue could be taken up after approval of the Balance Sheet and fixing the date for the AGM. It was important because, in terms of Article 89(c) all the directors have to be elected every year and as such their term of office was to expire on 31^st December, 1998.

8. The learned counsel further submitted: When the 1^st petitioner in his capacity as MD appointed 3 non key personnel, the 2^nd respondent objected to the same by a letter dated 4^th Jan. 1999 ( Annexure 'R') stating that these appointments were null and void and copies of this letter were sent to the three appointees also. All these three personnel were appointed as trainees and therefore Article 122 (e) did not apply to their appointments. These appointees were even verbally threatened that they should not attend office. The 3^rd respondent issued an office order that no new individual was to be enrolled as an employee and no benefit should be extended to them unless his appointment was backed by a proper Board Resolution. Because of the destructive approach adopted by the respondents and on account of the deadlock created by them, many of the projects could not be completed and the banks are not renewing working capital limits because of non adoption of the balance sheet as on 31^st March, 1998.

9. Referring to CA 57 of 2001, the learned counsel submitted: The company is a debt free company. However, the respondents opened a new bank account in Janak Puri Branch of ICICI Bank and took a loan of Rs. 74.81 lacs for purchase of cars. Such an action is in violation of Article 58 according to which there should be two affirmative votes from both Groups 'A' and 'B' for borrowing money. Further, Article 122 (c )(4) specifically provides that borrowing exceeding an aggregate of Rs. 10 lacs at any single instance would require two affirmative votes of each Group 'A' and 'B'. The respondents have bought 11 cars for a total consideration of Rs. 76 lacs for their personal use. The company already has 42 vehicles and therefore there was no need to purchase new vehicles and it was done only for their personal use. As per the Articles, all bank operations are to be carried on with joint signatures of one person each from Group 'A' and Group 'B'. However, in respect of this account, the 2^nd respondent is the sole signatory.

Even in the resolution furnished to the bank for opening the bank account, it is shown as if the Board had approved the opening of this current account. In fact, no Board Meeting had taken place after 7^th January, 1999. Thus, the respondents have produced a false Board Resolution to the bank. By a letter dated 17.2.2001 ( Annexure -'A-12'), the bank sought for from the company, post dated cheques towards repayment of the loan and by a letter dated 7^th March, 2001, the 1^st petitioner had to inform the bank that the loan obtained was without the permission of the Board of Directors and as such was not binding on the company. Therefore, the entire transaction was done by the respondents without the knowledge, consent and approval of the Board of Directors which is a grave act of mismanagement.

10. Referring to CA 175 of 2000, the learned counsel submitted: The respondents, in the guise of promotional schemes of certain products, have allowed advertisements to be published free of cost. By doing so, the respondents are causing a loss of Rs. 1 lac for each such advertisement. Such publication of free advertisements is without the consent of the petitioners and wholly unauthorized and illegal. They are also shifting equipments from Jaipur to Delhi unit and are also disposing of the equipments with a view to illegally enrich themselves.

Further, they have been debiting company's bank account for meeting personal expenses on personal credit card, thus, misappropriating the company funds for personal benefits. Because of their non cooperation in making payment for the land at Gurgaon, the allotment of land in favour of the company has been cancelled. Likewise, in spite of the consent order passed by this Board, the respondents did not cooperate with the petitioners in making payment for the land at Chandigarh due to which not only the allotment of land could be cancelled, even the amount of Rs. 2.85 crores paid earlier could also be forfeited. In addition to these prejudicial acts against the interests of the company, the respondents are also not managing Delhi unit properly. The circulation of Punjab Kesari, Delhi has come down drastically. The Jalandhar Edition, in view of the reduction of cover price has increased its circulation and the revenue is substantially going up.

The profits from Delhi unit is minimal. This would indicate that the respondents are mismanaging the affairs of Delhi unit.

11. Summing up his arguments, the learned counsel submitted that the respondents are guilty of siphoning of funds of the company, responsible for the deadlock and are mismanaging the affairs of Delhi unit. There is complete loss of trust between the two groups and it is impossible to carry on together. Since the parties themselves have agreed in the family agreements, shareholders' agreement and in the Articles that in case of deadlock, there should be equal division between the two groups, there should be a division of the business and assets of the company. The division should be directed in such a way that the units controlled by each group continue to be with the same group after division. As a matter of fact in the writ petition filed by the respondents in Punjab & Haryana High Court against the order of the Provident Fund authorities attaching the bank account of the company at Delhi, the respondents themselves have averred that they have no connection with Jalandhar and Ambala units which are under the control of the petitioners. Further, even before this Bench, the respondents had agreed for division. Even otherwise, as this Board has done in a number of cases of deadlock in family companies, this Board can, on its own, order division with a view to put an end to the matters complained of. Even though the petitioners had prepared two lots initially with the first choice of selection with the respondents, now the petitioners should be allowed to retain Ambala and Jalandhar unit and respondents can have Delhi and Jaipur units and the difference, if any, between the two, can be ordered to be compensated in cash.

12. Shri Tikku, Sr. Advocate, appearing for the respondents submitted: Even though it is admitted that company is in the nature of a partnership and a family company, yet, the petition does not disclose any ground for grant of relief sought for. The petitioners have tried to strengthen their case on the basis of subsequent events which is not permissible. It has been repeatedly held that the court must confine itself to the case made out in the petition and to the allegations made therein and not to look at other evidence with regard to events that might have happened subsequent to the petition. (Subhash Chand Aggarwal v. Associated Limestone Ltd -92 CC 525 CLB: P.S. Offshore Inter v.Bombay Offshore Suppliers - 75 CC 583 Bom: Mohta Bros P Ltd v. Calcutta Landing -40 CC 119 Cal: Rajahmundry Electric Supply Corporation Ltd v.A. Nageshwara Rao- AIR 1956 SC 213) . Till 1996-97, as is evident from the annual report for that year, the company was being managed jointly by both the groups and there was never an allegation of either oppression, mismanagement or deadlock. The disputes started only when the petitioners began acting in breach of the terms of shareholders' agreement and Articles. The petitioners have projected as if there had been disputes between the two groups for a long time and that was the reason why the family settlements dated 27^th June, 1995, 6^th May, 1996 and shareholders agreement dated 8^th Feb. 1997 were entered into between the two groups. There were no disputes earlier. All these agreements were entered into not because there were disputes but with a view to ensure smooth and uninterrupted functioning of the company with equal rights and representation in the management of the company and to eliminate outside influence on the members of both the groups. After the terms of the shareholders' agreement were incorporated in the Articles, the petitioners did not comply with many of the provisions of the Articles. Article 12 clearly provides that if a person from one group is CMD, a person from the other group shall be JMD and Joint Editor. Presently, the 1^st petitioner from Group B is the CMD and Editor-in -Chief and therefore one of the respondents from Group A should have been appointed as JMD and Joint Editor. However, so far the Group B has not agreed to appoint JMD from Group A. Article 14.2 requires 21 days notice for Board Meetings but such notices are not given for Board Meetings. As per Article 13, all key appointments are to be approved by 3/4^th majority of the Board with at least two affirmative votes of each group and this provision is not being followed in making appointments. The alleged deadlock in the Board Meeting held on 28.11.1998 arose only because one of the agenda items therein was to appoint a Joint Managing Director from Group A which Group B did not wish to proceed with. In that meeting, the respondent directors desired that all the agenda items should be taken up chronologically but with a view to avoid Item No. 5 relating to the appointment of JMD, the petitioners' group insisted consideration of only items relating to approval of accounts and fixing a date for the Annual General Meeting. It is wrong on the part of the petitioners to complain that the respondents insisted on discussion only on appointments and custody of title deeds. Under the bogie of approval of accounts, the petitioners adjourned the meeting and then called for a fresh Board Meeting notwithstanding the fact that they had already sought for approval from the ROC for extension of time to hold the AGM.Therefore it is petitioners who created a deadlock in the meeting held on 28.11.1999. All along the respondents were only trying to enforce the terms of the Articles which according to the petitioners is an act of oppression. The petitioners have always been insisting on continuing past practices which no longer hold good after the Articles of the company have been amended. A scrutiny of the various allegations in the petition would indicate that none of the allegations would warrant the winding up of the company on just and equitable grounds. Till 1995, it is the respondents who held majority shares. Only in the year 1995, 0.33% shares were transferred to the petitioners' group with a view to bring equality in the shareholding. When Shri Ramesh Chander was alive, the 2^nd respondent joined the company as the General Manager and it was he, who was responsible for establishing the Delhi Unit. Under his control and guidance, Punjab Kesri Delhi became the largest selling Hindi Newspaper in Delhi. The 3^rd respondent joined the company in the year 1984-85 in the advertising Department and was looking after the accounting and financial affairs of the company, lie has been instrumental in mobilizing funds for the company and also computerization and expansion projects of the company including installation of latest machinery needed for a Publishing House. He was appointed as a whole time director (Finance & Commercial) in 1992. The 3rd respondent is actually involved in day to day functioning of the Jalandhar Unit and therefore it is wrong on the part of the petitioners to claim that the petitioners are controlling the Jalandhar Unit. The company is a Board managed company and since both the groups have equal number of directors, all the decisions regarding the affairs of the company-are being taken jointly. Neither of the two groups can take individual credit for the phenomenal (sic) that the company has attained. In addition to this company, both the groups have jointly set up four partnership concerns and one private limited company with equal ownership and management. There is a Trust by the name of Lala Jagat Narain Charitable Trust and the Board of Trustees comprises of equal number of members and Trustees from both the groups. The affairs of these entities are closely linked with the affairs of the company and as such they are inter dependent and intertwined. That is the reason why the respondents, by an application, sought for impleading all these entities also in the present proceedings.

13. Referring to the counter to the petition wherein the respondents have denied every one of the allegations, the learned counsel submitted: A perusal of the various allegations made in the petition would indicate that these allegations cannot warrant any relief in a petition under Sections 397/398 of the Act. The respondents have dealt with each one of these allegations in their reply, from which it can be seen that all these allegations made against the respondents are frivolous. Till the Board Meeting held on 28.11.1999, the petitioners never complained about any of the acts of the respondents. The petitioners purposely created a situation of deadlock because they did not want to appoint the 3^rd respondent as the Joint Managing Director which was one of the agenda items numbered as 5. The petitioners actually wanted to first take up item No. 10 and 11 relating to approval of the draft balance sheet as on 31^st March, 1998 and the directors' report while the respondents insisted that all items should be taken up sequentially as per the agenda. Therefore, it was decided to adjourn the meeting sine die. However, by a telegram the petitioners informed the respondents that the later had walked out of the Board Meeting and that a Board Meeting could be held on 5^th December, 1998 for approval of the balance sheet and accounts. By a written telegram, the respondents informed the petitioners that the former had not walked out of the meeting but the meeting was adjourned sine-die. They had also informed the petitioners that further Board Meeting could be called for only after ascertaining the convenience of all the directors. However, by a telegram dated 6.1.1998, the petitioners convened a Board Meeting on 8^th December, 1998 for approval of the accounts for the year ended 31.3.1998 and fix 31^st Dec. 1998 as the date for holding the AGM. By a telegram dated 7^th Dec. 1998, the respondents drew the attention of the petitioners to Article 112 (ii), according to which 21 days notice should be given for Board Meetings and since the notice was short, the Board Meeting convened on 8^th Dec.

1998 would be illegal. In view of this, the company issued a notice on 10.12.1998 convening a Board Meeting on 31^st Dec. 1998 wherein the only agenda item consisted of approval of balance sheet, directors' report and fixing of a date for AGM. This itself would indicate that the petitioners were not interested in considering any other item as per the agenda for the meeting on 28.11.1998. Since the Board Meeting on 28.11.1998 had been adjourned, all businesses proposed for consideration in that meeting should have been fixed for consideration in the Board Meeting convened on 31^st Dec. 1998. Therefore, the respondents did not attend this meeting. By a telegram dated 31^st Dec.

1998, the 1^st petitioner informed the respondents that since none from respondent side was present in the meeting on 31^st Dec. 1998, there was no quorum and therefore the meeting was being adjourned to be held on 7^th January, 1999. On 7^th January, the respondents attended the Board Meeting and when they asked for the minutes book, attendance register etc., the petitioners refused to produce the same. In view of this, once again the meeting was adjourned sin-e-die. The respondents however suggested holding of another meeting with due notice and that all the agenda items kept for consideration on 28 Nov. 1998 should be considered in that meeting. However, by a letter dated 10^th January, 1999, the petitioners once again alleged that the respondents had walked out of that meeting only because items No. 7 and 8 of the agenda for the Board Meeting on 28.11.1998 were not part of the agenda. The very fact that the petitioners insisted in all the meetings that only items 10, 11 and 12 should be taken up for consideration would indicate that they never wanted to consider item No. 5 relating to appointment of the 3rd respondent as Joint Managing Director. Having taken a rigid stand, the petitioners cannot now allege stalemate or deadlock. If the main allegation of the petitioners relates to the alleged refusal of the respondents to attend Board Meetings, even now the respondents are willing to participate in a Board Meeting provided an independent Chairman is appointed and all the agenda items for the Board Meeting on 28.11.1998 are taken up for consideration. Once it is done, the question of alleged deadlock would no longer survive. It is a settled law that to invoke the provisions of Section 397/398, the petitioners should show that there have been continuous acts of oppression or mismanagement upto the date of the petition and that such acts are harsh, burdensome and wrongful. Mere lack of confidence between the shareholders would not be sufficient ( Shanti Prasad Jain v. Kalinga Tube Ltd -AIR 1965 SC 1535: V.M. Rao v. Rajeswari Ramakrishnan - 61 CC 743) 14. The learned counsel further submitted: After filing of the petition and during the proceedings before this Bench, the respondents have brought before this Bench various acts of mismanagement by the petitioners and seeking for appointment of an Administrator. They have been guilty of siphoning of funds, opening of parallel offices in Delhi, misuse of company funds by obliging people to their advantage, making key appointments in violation of the Articles, adopting unfair labour practices, filing of false cases against the employees etc. It is the petitioners who have been guilty of violation of the provisions of the Articles with the view to sideline the respondents. Holding the position of Chairman and Managing Director, the 1^st petitioner purposely did not issue any notice for either Board Meetings or for holding AGMs. The respondents have always been willing to ensure that all the statutory requirements are- met with. The petitioners, being apprehensive that the respondents would favourably response to the notices for both Board Meetings and AGMs, have not been convening these meetings and now they are complaining of deadlock. The petitioners cannot continue to claim that there a is deadlock in the affairs of the company. A solitary instance of an alleged deadlock in a Board Meeting cannot give rise to a petition under Sections 397/398 of the Act. From the affidavit filed by the respondents on 29.9.2003, wherein they have given details of various bills, orders to suppliers etc signed by both the groups as late as in 2003, it is evident that there has been joint consultation between the two groups and there is no stalemate. The admitted fact is that there has been phenomenal growth in the progress of the company which was achieved only by Joint management by both the groups and no single individual or group can take credit for the same.

Because of the various acts of the petitioners against the interest of the company, the respondents had to file various civil suits seeking for preventive orders. The petitioners even went to the extent of inspiring third parties closely associated with the company to act against the interest of the company/respondents. For instance, on an complaint made by them, Indian Newspapers Association Newspaper Society removed the respondents' name from the Year Book so that they do not contest the election to the representative body of the Newspaper. The 1^st petitioner being the Chairman and Managing Director, failed to file PF Returns and contribution due to which the PF Authorities passed an ex-parte order raising substantial claims against the company and tried to attach the Bank account maintained by Delhi Unit. It is the respondents who initiated appropriate proceedings before the High Court of Punjab and Haryana to protect the interest of the company.

15. Summing up his arguments, Shr Tikku submitted: To seek reliefs in a petition under Sections 397/398, the petitioners should establish that there have been acts of oppression and that it is just and equitable that the company should be wound up and that such winding up would not be in the interests of the shareholders as held in Needles Industries case (51 CC 742): World Wide Agencies P Ltd v. Margarat T. Desor (AIR 1990 SC 737). None of these requirements is satisfied in this case. The main prayer of the petitioners is to divide the company by which the petitioners want to have full control of Jalandhar Unit. It is on record that 1.8% shares of the company are held by members of public and therefore without their consent, the assets and business of the company cannot be divided. The company is 52 years old and presently it enjoys a position of command in the national mainstream. It has been possible only because of the joint management. This Bench being the court of equity has to keep this aspect in mind before considering any relief sought for by the petitioners. Further, a large number of work force is involved. Since the only main allegation in the petition relates to Board Meeting on 28.11.1998 with two different stands taken by the parties on the proceedings of this meeting, as already suggested, a fresh Board Meeting be called with an independent Chairman for consideration of the same agenda items. The respondents undertake to attend this meeting and transact all the businesses. The exercise of powers by this Board is discretionary and if an efficacious means of redressal is available to the petitioners, this Board should not consider any relief and that only on compelling grounds, the Court can interfere with the affairs of a company. (R.S. Mathur v. H.S. Mathur- 1970 1 CLJ 35 All). In the same case, it has also been held that the main objective of Section 397 is to put an end to the complaints and by directing a Board Meeting as suggested, this complaint can be put to an end to. Even though by various other subsequent applications, the petitioners have made further allegations against the respondents, yet, they need not have to be looked into as the validity of the petition has to be judged on the facts alleged therein and existing at the time of the petition. If the petitioners desire division, let them terminate the shareholders' agreement and seek for specific performance in a civil court. The prayer of the petitioners for division is likely to cause greater prejudice to the company, shareholders and public interest. This Bench cannot be a party to such a situation. A remedy proposed and adopted to over come the allegations should not become a source of greater oppression than the one sought to be removed or prevented (Mathurs's case-supra). Therefore, if at all the petitioners are entitled for any relief, it should be limited to appointment of a permanent Chairman with powers to take decisions in the event of any tie in voting, operations and management of the company. He can also be directed to convene a Board meeting to transact all the business proposed for the Board meeting on 28.11.1998 so that the disputes could be settled in the domestic forum itself.

16. In rejoinder, Shri Mookherjee submitted: It is incorrect to say that there were no disputes among the parties before the Board Meeting on 28.11.1998. The very fact that there were two family settlements and another shareholders' agreement resulting in amendment to the Articles would indicate that there had been disputes. By these agreements, the parties had tried to resolve their disputes domestically but did not succeed. In other words, both the domestic forum and the company forum have failed to end the disputes between the two groups. Even the consensual arrangement before this Bench had failed. There is absolutely no reason as to why the respondents should object to the division of the assets and business of the company between the two groups when they had agreed to do so in Clause 6 of Family Settlement dated 26.5.1995, Clause 3 of family settlement dated 6^th May, 1996 and Article 191 of the AOA of the company. Further, as is evident from the orders of this Bench dated 18.1.2000, 14.2.2000, 22.2.2000, 3.3.2000 and 4.4.2000, both the parties had agreed for division. Further, when there is a situation of deadlock and the events indicate that both the parties cannot continue together, even in law, in exercise of powers under Section 402 of the Act, this Bench has the power to order such a division. In Vijay Krishan Jaidka v. Jaidka Motors Pvt. Ltd. (1997 1 CLJ 268), this Board had directed division of assets between the two warring groups in a situation of deadlock. Similarly, in K.N. Bhargava v. Track Parts of India Ltd. (104 CC 611) , this Board directed division of even a listed company when two groups of family shareholders holding substantial shares could not carry on business together. Further, presently there is practically a de-facto division between the two groups - Jalandhar with petitioners' group and Delhi with respondents' group. By an order, this de-facto division could be formalized by this Bench and any difference in the value of the two could be compensated by cash. The contention of the respondents is that just an impasse in a Board Meeting does not amount to either deadlock or oppression meriting grant of relief. In the present case, relationship between the two groups has come to such a state that it would be impossible to carry on together. In Groz Brekert's (83 CC 371) case, when the Company Law Board found that the two warring groups could not carry on together, it ordered parting of ways. The deadlock is evident from the fact that annual accounts have not been finalized and approved either by the Board or by the general body right from 1998. The impasse in the Board Meeting on 28.11.1998 was created by the respondents. Their version that since the petitioners were not prepared to take up item No. 5 for appointment of the 3rd respondent as the JMD is not borne out in any of the communications to the petitioners but has been raised only in the petition. In all the correspondences, they were only referring to items No. 7 and 8. When the main statutory responsibility of a company to finalize and pass annual accounts has not been discharged for a number of years, the same would call for winding up of a company on just and equitable grounds as has been held in Loch v. John Blackwood Ltd. (1924 AER Rep 200). In that case, the directors had failed to observe statutory conditions as two general meetings, did not submit balance sheets and did not comply with the provisions under the statute. The court held that it was impossible for the minority shareholders to obtain any relief by calling a general meeting and therefore they could apply for winding up on just and equitable grounds. In the present case, both the groups hold equal number of shares and equal representation on the Board and therefore one group alone cannot set things right other than seeking winding up of the company on just and equitable grounds which would not be in their interest and that is why alternate reliefs under Sections 397/398 have been sought for.

17. I have considered the pleadings, arguments and the written submissions of the parties. The allegations in the petition have been summarized in paragraph 3 ante. Thereafter, in the rejoinder as well as in Applications CA 175/2000 and CA 57/2001, the petitioners have made further allegations on the events that took place after the petition was filed. The respondents had also filed 3 applications making allegations against the petitioners. In CA 294/1999, they sought for appointment of an Administrator on the ground of misappropriation of company funds by the petitioners. In CA 7/2000, on the allegations that the petitioners had effected reduction in the cover price of the papers and had reduced the advertisement rates, once again sought for appointment of an Administrator. In CA 40/2000, alleging that the petitioners had removed all the records of the company and that they had sold news print and aluminium outside the books and had misappropriated over Rs. 70 lakhs, once again sought for appointment of an Administrator to supervise and control the day to day working of the company. The learned counsel for the respondents advanced an argument that a petition should stand on its own and subsequent events cannot be considered and on this proposition he cited some cases. In Karelda Suryanarayanan v. Sri Ramdass Motor Transport P Ltd (92CC 275), this Board had taken the view that there is no bar in subsequent events being brought on record and considered by this Board but such consideration would be only to mould the relief to be granted.

According to the respondents, the allegations contained in the petition can neither be classified as oppression or mismanagement on the part of the respondents as most of them are frivolous and unsubstantiated as is evident from the detailed reply filed by them.

18. This is a case wherein both the sides have leveled allegations against each other not only in the conduct of the business of the company but also personal in nature. The substantive allegation in the petition relates to the Board meeting on 28.11.1998 which, inspite of having been adjourned more than once, did not transact any business.

Both the groups have their own version of that meeting. While the petitioners allege that the respondents were adamant to take up items 7 and 8 first and also wanted that the proposal given by them should be accepted, the respondents allege that with the view to avoid consideration of the item relating to the appointment of the 3rd respondent as the Joint MD, the petitioners were insisting that matters relating to the accounts and AGM should be decided. Whatever may be the correct position, the end result was that there was a stalemate and thereafter, no Board meeting has been held till now and that accounts have not been adopted in the General meetings. Further, in terms of the Articles, all the directors hold office only upto the date of the next AGM and since no AGM has been held from 1998, none of them can legally continue and discharge functions as directors. In other words the basic statutory requirements have not been complied with for over 6 years now. I am of the view that no useful purpose will be served in giving a finding on individual allegations made by each against the other as the same is not going to solve the present stalemate prevailing in the affairs of the company as also in the relationship among the parties.

It would rather be appropriate to examine as to whether any remedial measure is possible to ensure that the affairs of the company are carried on in accordance with law and Articles. The respondents filed an affidavit dated 29^th September, 2003 stating that there is no deadlock in the company as alleged by the petitioners as even now all decisions regarding infrastructural and input items were being taken jointly by the company, under the joint signatures of one of the members of either group i.e. Group 'A' and Group 'B'. They have further averred that all input costs, statutory payments etc. are being made jointly and decisions being taken after discussions among directors. To substantiate this averment, they have also enclosed copies of letters of instructions issued to the bank for making payments and also copies of orders place on supplier, all jointly signed by a director from Group 'A and a director from Group 'B'. When this affidavit was referred to, the learned counsel for the petitioners submitted that there had been no common disbursement like provident fund remittance, salary, bonus, ex-gratia, rental taxes, advertising sales promotion and capital expenditure as from January, 2000 onwards as the parties were not in talking terms with each other. These infrastructural and inputs costs had to be incurred failing which the business of the company would come to a stand still. Mere cooperation with each other for the survival of the business of the company does not mean that there is no deadlock. The very fact that there has been no Board meeting or AGM and that accounts have not been adopted for over 6 years, by reason of the parties being not even on talking terms would indicate that there is a complete dead lock in the affairs of the company. I am inclined with the submissions of the learned counsel for the respondents. The learned counsel for the respondents, relying on Kalinga Tube and Rajeswari Ramakrishnan cases (supra) submitted that there should be continuous acts of oppression to warrant reliefs in a petition under Section 397/398. Even assuming that this petition is based on a single act, that is alleged dead lock in the Board meeting on 28.11.98, its effect still continues, in the sense, no further Board meetings or AGM have been held so far and the accounts have not been finalized for nearly 6 years. Thus, there have been continuous statutory defaults due to deadlock. I had to pass an order, at the request of the parties on 1.10.2003 restraining the Registrar of Companies from taking any further action in terms of the notice issued by him on 19.9.2003 for various statutory defaults committed by the company. Further, even after filing of the petition, both the sides have made allegations of mismanagement against each other exhibiting clearly that acts of mismanagement are continuing. Shri Tiku relied on Needles Industries and Margarat T. Desor cases (supra) to state that the petitioners should make out a case for winding up of the company on just and equitable grounds. In cases of dead lock in family companies with equal share holding and equality in management, dead lock situation would warrant winding up of a company on just and equitable grounds and reliefs can be granted in a petition under Sections 397/398.

(Krishanlal Ahuja v. Sureshkumar Ahuja -53 CC 60 Del: Saboo's case CLB(supra):Sishu Ranjan Datta v. Bhola Nath Paper House Ltd-53 CC 883 Cal: Combust Technic P Ltd Re-1993 1 CLJ Cal) 19. The fact that the company is a family company is not disputed and it is also a fact that there are two distinct groups of shareholders, the respondents constituting group 'A' and the petitioners, group 'B'.

Both the groups hold equal number of shares in the company. They have also by means of two family agreements and shareholders' agreement decided to conduct the affairs of the company jointly with equal representation on the Board and with equal powers as is evident from the fact that affirmative votes from both the groups are required for most of the decisions in the affairs of the company. In this connection, it may be relevant to refer to paragraph 7(xiii) of the Counter of the Respondents wherein they have averred "It is pertinent to state that the success of the company lay in the joint and equal management of Group 'A' and Group 'B' ". The affairs of the company could be carried on in line with the terms of the Articles of Association of the company only if both the groups resume their relationship of cordiality and cooperate with each other. Each group has made allegations against the other group of siphoning of funds of the company, acting against the interest of the company etc. In addition, both the groups have also brought in the employees of the company into their fight. While according to the 1^st petitioner, he is a Bachelor of Arts with a Diploma in Printing and Technology from Germany and Diploma in advanced Newspaper Management from London, according to the respondents the 1^st petitioner does not possess adequate educational qualification nor any business acumen to hold his position but the same was conferred upon him as the titular head of the family. In page No. 199 of the Counter, the respondents have averred "If is stated that the conduct of the petitioner No. 1 in his personal and private life is not worthy of a Newspaper Editor. The respondents can demonstrate the ill doings of the petitioner No. 1 which have brought ill repute to the newspaper and disgrace to the family". In page No. 132, it is stated "The petitioners do not possess even an elementary knowledge of running a newspaper. They do not have any exposure to sophisticated and modern management and technical operations of India's leading publishing houses. Besides they do not even possess even cursory knowledge of journalistic ethics and practices in running a modern newspaper". In the similar vein, the petitioners have averred "The only image that respondent No. 2 has tried and succeeded in building is that of a person who is consistently attending loud, lavish and late night parties".(Page 8 of the Rejoinder). In page 12 of the rejoinder, it is stated "It is submitted that the respondent No. 3 takes no interest in the working or management of the company. He does not even attend to the role assigned to him. He attends office as per his whims and fancies and that too for a couple of hours a day, if at all, and whatever little attention he does give to the company is only for the purposes of disrupting its affairs and functions. He disappears for months on end on holidays with his family without any leave of absence". In page 67 of the rejoinder, it is stated "The acts are conduct of the respondents has tarnished the reputation of the company and as a result affect the good will of the company which has been built up over the last 50 years. The respondents No. 2 and 3 are not fit persons to be involved in the management of the company". With this sort of acrimonious personal accusations against each other, it is extremely doubtful whether both the groups could continue to jointly manage the affairs of the company smoothly. Even for payment of consideration for the Chandigarh land, this Bench had to hear the parties in a number of hearings and give directions, which, it is learnt have not borne fruit yet. There is complete loss of trust and confidence between the two group as revealed during the hearing of an application filed by the workers' union seeking for a direction to the company to pay bonus/ex-gratia to the employees. This application had to be heard on a number of occasions (application was filed in October 2000 and payment was made in August 2001 after repeated directions) as both the sides doubted the correctness and veracity of the workers list given by both of them in respect of the units under their control. When each group suspects the honesty of the other and makes allegations of siphoning of funds, they can never continue to work together with equal participation in the management. Even though, the respondents have taken a stand in the present proceeding that the family agreements were not consequent to any disputes earlier, in the writ petition, they have averred that due to disputes that started in 1994, family settlements were entered into. It appears to me that the disputes which started in 1994 have now become irreconcilable inspite of 3 quick and successive agreements and that the parties have reached a point of no return.

20. The respondents have given a suggestion that a Board Meeting may be convened with an independent Chairman to transact the same businesses that were proposed for the meeting convened on 28.11.1998 so that the alleged deadlock can be broken. According to him, relying on R.S.Mathur case, if an allegation of deadlock could be put an end to by ordering a Board meeting, then no other relief needs to be given. As a matter of fact, the issue of having an independent chairman was considered on 20.8.99, when this petition was mentioned and certain interim reliefs were sought. When this Bench suggested that the 4 items on which interim reliefs were sought could be placed before the Board with an independent chairman, while the respondents were agreeable, the petitioners were willing only for an observer, which was not acceptable to the respondents. Now, with such a long passage of time and in view of the petitioners stand that they would not support the said suggestion, even if the meeting is ordered to be held, it is not going to bear any fruit. Further, such a suggestion has come with a rider that a permanent Chairman be appointed with the power to take decisions in the event of any tie in voting, operations and management of the company. Having a permanent Chairman with the ultimate decision making powers, (which suggestion's not acceptable to the petitioners) would straight away defeat the very foundation of the shareholders agreement/Articles, which in the words of the respondents "All these agreements were entered into not because there were disputes but with a view to ensure smooth and uninterrupted functioning of the company with equal rights and representation in the management of the company and to eliminate outside influence on the members of both the groups". If these agreements had been entered into with the view to eliminate outside influence, then having a Chairman with ultimate decision making power would be destructive to the family nature of the company.

Therefore, I am of the view that, having an independent Chairman for all the time to come cannot be a permanent solution. Therefore, parting of ways between the two groups would not only be in the interest of the company, but also to the shareholders and the employees.

21. The suggestion relating to parting of ways is not some things new.

In all the agreements, there is provision to the effect that in case of disputes among the parties, which could not be resolved amicably, the business of the company would be split equally between the parties. In the family settlement dated 26.5.1995, in Clause 6, it is stated "In case of irreconcilable differences on running of business between the two families, way to be found to split the business equally rather than one side trying to oust the other family with outside help or otherwise". Similar provision has been made in the agreement dated 6^th May, 1996. The shareholders' agreement also provides in Article 22 that in case of termination of the agreement "Assets, Liabilities, Trade Marks, Trade Name and good will of the company will be shared and/or divided between the parties in such a manner that neither party will have advantage over the other party". Article 191 of the AOA which reads "In the event of material deadlock in the affairs of the company, whereby parties/major shareholders decide that they cannot work together any more, good will, trade marks, trade name and assets and liabilities of the company will be amicably determined and divided equally amongst parties. It will be the duty of the arbitrators to draw a scheme to see that neither parties gets more advantage over the other party, if necessary, sanction to be obtained from the appropriate authority (court/CLB etc.)", also provides for division. Besides these specific written provisions, before this Bench also the parties had agreed for division of the business of the company. In the hearing held on 18.1.2000, it was agreed that the petitioners would give a proposal in writing to the respondents for amicably settling the disputes.

Accordingly, in the hearing held on 14.2.2000, the petitioners gave a proposal of dividing the assets and businesses of the company and other family businesses in to two lots leaving the first choice of selection to the respondents. The respondents were directed to react to the same.

However, in the hearing held on 22.2.2000, the petitioners desired to make some elaborations without any substantial changes to the proposal given by them earlier and as such they were directed to give the fresh proposal by 7^th March, 2000. In the hearing held on 9.3.2000, the petitioners gave their fresh proposal and the counsel for the respondents desired time to consider the same. In the hearing held on 4.4.2000 also, the respondents sought for some more time to study the feasibility of the division. However, later on, they filed an application under Section 8 of the Arbitration and Conciliation Act, which was dismissed. It is evident from this sequence of events that between 18.1.2000 to 4.4.2000, that the respondents did not have any objection to the division of the assets and businesses of the company.

Therefore, as rightly pointed out by Shri Mookherjee, when the parties themselves have decided in various documents and in the AOA that in case of deadlock or irreconcilable differences, the only manner of resolving the disputes is by way of division, the same could be ordered by this Bench. Further, in cases of deadlock or irreconcilable differences among the shareholders in a family company, in terms of Section 402 of the Act, this Board has always directed parting of ways either by sale of shares held by one group to the other or division of business/assets if feasible. In Trackparts India case (supra), this Board found that it was feasible to divide the manufacturing units in the company between the two groups and accordingly directed division.

In the present case, since there are four distinct units of the company with their own publications, it is quite possible to divide the business between the two. That is why even at the initial stage, with the consent of both the parties, the petitioners were directed to prepare two lots dividing the assets and businesses of the company and other family interests into two equal parts. Since the petitioners were preparing the proposal, the choice of first choosing the lot was given to the respondents. However, this proposal did not materialize. If it is established that each group is independently managing some units, it would be proper that those Units continue to be with the same group at the time of division. In Shri Prakash Nath v. Ashoka Manufacturing Co.

Pvt. Ltd., (111 CC 711) the company had two units and similar to the present case, the shareholders styling themselves as Group 'A' and Group 'B' were independently managing one unit each for a number of years. Therefore this Board formalized the informal division by directing each group to manage its own unit independent of the other and thus paved for parting of ways. Even though it is the assertion of the petitioners that they are in complete control of Jalandhar and Ambala units, (without staking any claim on Delhi and Jaipur units), the respondents assert that they are also part and parcel of the management of the Jalandhar and Ambala Units. In this connection, it is appropriate to refer to the pleadings of the respondents in the writ petition filed by them in Punjab and Haryana High Court. This writ petition was filed by the respondents challenging the order of Provident Fund authorities directing Punjab & Sindh Bank, Town Branch, Delhi to pay a sum of about Rs. 98 lacs from the account of the company maintained in that branch. The Writ was filed in the name of the company by the 3^rd respondent, on the ground that the said amount was payable by Jalandhar Unit of the company and therefore the Delhi Unit cannot be made responsible for that liability. In the writ petition, it has been averred "The Group 'A; rum the Delhi and Jaipur Unit and Group 'B' runs the Jalandhar and Ambala Unit. At present the company publishes four Newspapers i.e. Punjab Kesri ( Delhi), Punjab Kesri ( Jalandhar), Jagbani and Hind Samachar. The arrangement has been made so that the interest of the groups do not clash and the company can have a smooth running". In Paragraph 5 of the said petition, it is stated "However, since the parent company is the same, the formal division has not yet taken place. Although the formal division has not taken place, the Group 'A' and Group 'B' are working total independent entities and have no concern with each other". In Paragraph 6, it is stated "The members of Group 'A' have no concern whatsoever in the running and management of the establishment at Jalandhar. Once the Group 'A' has not concern with the running and management of the establishment at Jalandhar, the group 'A' cannot be penalized for the misdeeds and illegal actions of Group 'B'". In paragraph 11, it is further stated "That the petitioner company has been divided into two groups i.e.

Group 'A' and Group 'B'. The group 'A' runs the units at Delhi and Jaipur and Group 'B' runs units at Jalandhar and Ambala. Although the parent company is the same and separate companies have not been formed, the working of Group 'A' and Group ';B is entirely independent and groups have no concern, whatsoever with each other". These averments in the writ petition clearly indicate that the respondents themselves have recognized that the Jalandhar and Ambala Units are being managed by the petitioners, independent of the respondents. The respondents cannot take one stand in the High Court for the purpose of avoiding penal action and take a different stand in the present proceedings that they are jointly managing Jalandhar and Ambala Units, to avoid division.

22. Therefore, it is evident that the petitioners are in de-facto control of Jalandhar and Ambala units and the respondents are in control of Delhi and Jaipur Units. In view of this, I am of the view that the disputes between the two groups could be put an end to, which would be in the interest of the shareholders and the company, by division of the business and assets of the company by vesting the Jalandhar and Ambala Units with the petitioners and Delhi and Jaipur Units with the respondents. The respondents have contended that there are outside shareholders having about 1.8% shares and as such without their consent, no division is possible. These shareholders can be given the option of either to going with one group or to get fair value for their shares. In view this, there is no need to get their consent.

Division of a Newspaper company among the family members is not something new. In the matter of Indian Express news paper, there were disputes among the shareholders resulting in proceedings in Madras and Bombay High Courts. A petition was filed before this Board also under Sections 397/398. With the persuasion and assistance of this Board, the parties therein agreed for division of their interests in the entire Express Group. Southern Editions of the group publications went to one group and publications in the rest of India to the other group.

23. Accordingly 1 direct that there shall be a division of the company with the petitioners taking over the complete control of Jalandhar and Ambala units and the respondents taking over Delhi and Jaipur units.

This will be along with the respective assets and liabilities identifiable with each unit. All common assets and liabilities will be apportioned equally either in specie if possible, or compensated by cash. The company will be with the petitioners as they will be controlling the Jalandhar unit and the respondents may incorporate a separate company with a different name. Since both the groups hold equal shares in the company, there has to be equality not only in terms of monetary value but also in all other respects like areas of distribution etc. I find that besides the company, both the groups have equal interest in four other partnership firms, another private limited company and a Trust all of which have dealings with the company. In the lots prepared originally by the petitioners, all these entities were also included in the division. Since I am directing division of the company with a view to put an end to the state of stalemate and to ensure parting of ways, it is advisable that both the groups agree for complete division of all their interests not only in these entities but also all other assets and properties of the family. I find from the lots prepared by the petitioners that each and every asset/liability of not only the company but also other entities and the family has been covered including territorial division of areas of distribution of different publications. While the first lot includes Jalandhar and Ambala Units, the second lot includes Delhi and Jaipur Units. Since the first choice of choosing a lot was with the respondents, it is but natural that the petitioners, while preparing the lots would have ensured equality. This being the case, if the respondents are agreeable to take the 2^nd lot which includes Delhi and Jaipur units, the disputes would come to an end. Otherwise, to ensure equal division, I have to appoint art independent person, preferably, a retired High Court or Supreme Court Judge to supervise and complete this exercise.

24. Accordingly, the matter is fixed for further consideration on 14^th July 2004 at 2.30 p.m. at which time the respondents should indicate as to whether they are willing to take the 2^nd lot as given by the petitioners on 7^th March 2000, or they would like to have the division done equally by an independent person- (with Jalandhar and Ambala with the petitioners and Delhi and Jaipur with the respondents). In the later case, both the sides should also indicate whether they are willing for including all the firms as well as other family interests in the division so that there would be a complete parting of ways between the two groups. They will also indicate the name of a retired Judge mutually acceptable to both the groups failing which 1 shall appoint one and give further directions.