IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 05.08.2011 CORAM: THE HONOURABLE MRS.JUSTICE R.BANUMATHI AND THE HON'BLE MR.JUSTICE V.PERIYA KARUPPIAH O.S.A.Nos.2 to 5 and 258 of 2009 and Company Appeal Nos.21, 25 to 27 and 29 of 2009 1.C.G.Holdings Private Limited, rep.by its Director, Senniappa Gounder No.78, Cheran Towers, Arts College Road, Coimbatore - 641 002. 2.Kangeyam Chenniappa Palanisamy ... Appellants in O.S.A.Nos.2 to 5 of 2009/Respondents in O.A.No.2670/2008, Applicants in A.No.2670/ 2008 and 2671/2008 and Respondents in A.1236/2008 Vs. 1.Ramasamy Athappan 2.Nandakumar Athappan ... Respondents 1&2 in O.S.A.Nos.2 to 5 of 2009 3.The Secretariat of the Court, International Chamber of Commerce, 38, Cours Albert I er 75008 Paris, France, 4.O.R.E.Holdings Limited, 3rd Floor, Les Cascades, Edith Cavell Street, Port Louis Mauritius, 5.Odyssey Re Holdings Corporation No.30, First Stamford Place, Stamford Connecticut, United States of America – 06902 6.Odyssey America Reinsurance Corporation, No.30, First Stamford Place, https://hcservices.ecourts.gov.in/hcservices/ Stamford Connecticut, United States of America – 06902 7.Fair Fox Financial Holdings Limited, No.95, Willington Street west Suite No.600, Toranto, Canada – M512 N07 8.Vasantha Mills Limited, rep.by its Director No.171, Trichy Road Singannallur Coimbatore – 641 028 9.Cheran Properties Limited, rep.by its Director, No.257, I Stage, 6th Cross Indira Nagar, Bangalore – 560 038 10.Cheran Enterprises (P) Limited rep.by its Board of Directors Cheran Towers, No.78, Arts College Road, Coimbatore – 642 002 ... Respondents 3 to 10 in O.S.A.Nos.2 to 4 of 2009/ 1 and 2 Applicants/Respondents in O.A.No.277 of 2008 Respondents in A.2670 of 2008 and 1 and 2 Respondent in A.2691/2008 1 and 2 Applicants/Respondents in A.1236 of 2008 O.S.A.No.258 of 2009: 1.Odyssey America Reinsurance Corporation No.300, First Stamford Place, Stamford Connecticut, United States of America – 06902, 2.O.R.E.Holdings Limited, IFS Court, Twenty Eight Cybercity, Ebene, Mauritius... Appellants/Respondents 1 and 2 in A.No.5848 of 2007 Vs. 1.Kangeyam Chenniappa Palanisamy 2.C.G.Holdings Private Limited, No.19, Raja Annamalai Building, Marshalls Road, Chennai rep.by its Board of Directors, https://hcservices.ecourts.gov.in/hcservices/ 3.Cheran Holdings Private Limited, No.7, College Lane, C Bungalow, Happy Nook, Nungambakkam, Chennai – 600 006 4.Cheran Constructions Limited, Cheran Towers, 78 Arts College Road Coimbatore. 5.Chenniappan Gounder 6.B.Gunasekaran .. Respondents/1 and 2 Applicants/ in A/5848/2007, 3 to 6 Respondents in 5848 of 2007 Company Appeal No.21 of 2009: O.R.E.Holdings Limited, a body corporate organized and existing under the laws of Mauritus with its office at IFS Court No.28, Cyber City, Ebene, Mauritius rep.by its Power Attorney R.Ravichandran... Appellant/Petitioner Vs. 1.Cheran Enterprises Pvt.Ltd., Company incorporated under the Provisions of the Companies Act, 1956, with its Regd.Office at Cheran Towers Arts Collee Road, Coimbatore – 641 018 Tamil nadu. 2.C.G.Holdings Private Limited, a Company incorporated under the Provisions of the Companies Act, 1956 with its Office at No.19, Raja Annamalai Building, Marshalls Road, Chennai and represented by these proceedings by K.C.Palaniswamy, its Director 3. Kangeyam Chenniappa Palanisamy 4.Cherraan Properties Limited, a Company incorporated under the provisions of the Companies Act, 1956, with its Office at Cheran Towers, Arts College Road, Coimbatore – 614 018, Tamil Nadu represented in these proceedings by K.C.Palaniswamy, its Director. https://hcservices.ecourts.gov.in/hcservices/ 5.Vasantha Mills Limited, a Company incorporated under the provisions of the Companies Act, 1956, with its Office at Cheran Towers, Arts College Road, Coimbatore – 641 018, Tamil Nadu represented in these proceedings by K.C.Palaniswamy, its Director 6.Nandakumar Athappan 7.Ramaswamy Athappan 8.State Bank of India, a Public Sector Banking Corporation, Erode Main Branch at Main Branch, State Bank Road, Erode – 638 001. 9.State Bank of India, a Public Sector Banking Corporation, Leather and International Branch at No.77/1, Poonamallee High Road Kilpauk, Chennai – 600 010 10.ABN Amro Bank Limited, Nungambakkam Branch, Chennai – 600 034 11.Syndicate Bank, a Public Sector Banking Corporation with its Head Office at Manipal, Karnataka – 576 104 12.Cherran Constructions Limited, a Company incorporated under the provisions of the Companies Act with its Office at Cheran Towers, Arts College Road, Coimbatore – 641 018 Tamil Nadu, rep.b y K.C.Palanisamy its Director. .... Respondents /Respondents Company Appeal No.25 of 2009: 1.N.Athappan 2.R.Athappan .... Appellants /Petitioners Vs. 1.O.R.E.Holdings Limited, IFS Court, No.28, Cyber City Ebene, Mauritius, 2.C.G.Holdings Private Limited, No.19, Rajannamalai Building, Marshalls Road, Chennai, https://hcservices.ecourts.gov.in/hcservices/ 3.K.C.Palanisamy 4.State Bank of India, Main Branch, Erode – 638 001 .... Respondents /Respondents Company Appeal No.26 of 2009: 1.Ramaswamy Athappan 2.Nandakumar Athappan .... Appellants /Respondents 5 and 3 Vs. 1.C.G.Holdings Private Limited, No.19, Rajaannamalai Building, Marshalls Road, Chennai 2.K.C.Palanisamy 3.Cheran Enterprises Private Limited, No.76, Cheran Towers, Arts College Road, Cloimbatore – 641 018, 4.ORE Housing Private Limited, IFS Court, No.28, Cyber City, Ebene, Mauritius 5.Chandran Ratnaswami 6.Odessey America Reinsurance Corporation, No.300, First Stamford Place, Stamford, Connecticut, U.S.A. ... Respondents /Petitioners Company Appeal No.27 of 2009: 1. C.G.Holdings Private Limited, a Company incorporated under the Provisions of the Companies Act of 1956, with its Registered Office at Cheran Towers, Arts College,Coimbatore – 641 018 2. Kangeyam Chenniappa Palaniswamy ...Appellants/Respondents 2 and 3 Vs. 1. O.R.E.Holdings Limited, a body Corporate organized and existing under the laws of Mauritius, with its Office at IFS Court No.28, https://hcservices.ecourts.gov.in/hcservices/ Cyber City, Ebene, Mauritius and represented in these proceedings by Chandran Ratnaswami, its Director 2. Cheran Enterprises Pvt.Ltd., a Company incorporated under the Provisions of the Companies Act, 1956, with its Regd.Office at Cheran Towers Arts Collee Road, Coimbatore – 641 018 3. Cherraan Properties Limited, a Company incorporated under the provisions of the Companies Act, 1956, with its Office at Cheran Towers, Arts College Road, Coimbatore – 614 018, represented in these proceedings by its Director. 4. Vasantha Mills Limited, a Company incorporated under the provisions of the Companies Act, 1956, with its Office at Cheran Towers, Arts College Road, Coimbatore – 641 018, represented in these proceedings by its Director 5. Nandakumar Athappan 6. Ramaswamy Athappan 7. State Bank of India, Erode a Public Sector Banking Banking Corporation, Erode Main Branch at Main Branch, State Bank Road, Erode. 8. State Bank of India, Chennai, a Public Sector Banking Corporation, Leather and International Branch at No.77/1, Poonamallee High Road Kilpauk, Chennai – 600 010 9. ABN Amro Bank Limited, Nungambakkam Branch, Chennai – 600 034 10. Syndicate Bank, a Public Sector Banking Corporation with its Head Office at Manipal, Karnataka – 576 104 https://hcservices.ecourts.gov.in/hcservices/ 11.Cherran Constructions Limited, a Company incorporated under the provisions of the Companies Act, 1956 with its Office at Cheran Towers, Arts College Road, Coimbatore – 641 018 Tamil Nadu, rep. In these proceedings its Director. .... Respondents /Applicant/Respondents Company Appeal No.29 of 2009:- O.R.E.Holdings Limited, a body Corporate organized and existing under the laws of Mauritius, with its Office at IFS Court No.28, Cyber City, Ebene, Mauritius ... Appellant/2nd Respondent Vs. 1.C.G.Holdings Private Limited, No.19, Raja Annamalai Building, Marshalls Road, Chennai rep.by Director, K.C.Palaniswamy 2.K.C.Palanisamy 3.Cheran Enterprises Private Limited, 'Cheran Towers', Arts College Road, Coimbatore – 641 018 4.Ramaswamy Athappan 5.Chandran Rathinaswamy 6.Nandakumar Athappan 7.Odessey America Reinsurance Corporation, First Stamford Place, Stamford, Connecticut – 06902, U.S.A. ... Respondents/Applicants/ Respondents 1,3 to 6 Prayer: O.S.A.Nos.2, 3, 4 and 5 of 2009 are filed under Section 50 of Arbitration and Conciliation Act, 1996 read with Order 39 Rule 1 of O.S.Rules read with Clause 15 of the Letters Patent Act against the Order dated 29.10.2008 made in O.A.No.277 of 2008 and Application Nos.1236, 2670 and 2671 of 2008 respectively in C.S.No.257 of 2008 on the file of this Court. https://hcservices.ecourts.gov.in/hcservices/ O.S.A.No.258 of 2009 is filed under Order 36 Rule 1 of O.S.Rules read with Clause 15 of Letters Patent against the Order dated 4.2.2008 made in Application No.5848 of 2007 in C.S.No.709 of 2007 on the file of this Court. Company Appeal Nos.21 and 27 of 2009 are filed under Section 10F of Companies Act, 1956 and Order 36 Rule 1 of O.S.Rules read with Clause 15 of Letters Patent against the Order dated 3.8.2009 passed by Company Law Board, Additional Principal Bench, Chennai in C.A.No.155 of 2008 in C.P.No.76 of 2005. Company Appeal No.25 of 2009 is filed under Section 10F companies Act, 1956 and Order 36 Rule 1 O.S.Rules read with Clause 15 of Letters Patent against the Order dated 3.8.2009 passed by the Company Law Board, Additional Principal Bench in C.A.No.10 of 2009 in C.P.No.76 of 2005. Company Appeal No.26 of 2009 is filed under Section 10F companies Act, 1956 and Order 36 Rule 1 O.S.Rules read with Clause 15 of Letters Patent against the Order dated 3.8.2009 passed by the Company Law Board, Additional Principal Bench in C.A.No.154 of 2008 in C.P.No.65 of 2005. Company Appeal No.29 of 2009 is filed under Section 10F companies Act, 1956 and Order 36 Rule 1 O.S.Rules read with Clause 15 of Letters Patent against the Order dated 3.8.2009 passed by the Company Law Board, Additional Principal Bench in C.A.No.154 of 2008 in C.P.No.65 of 2005. O.A.No.;277 of 2008: Original Application praying that this Hon'ble Court be pleased to pass an order of temporary injunction restraining the 6th and 10th respondent, their men, agents, servants, assigns or any person claiming under or through them jointly and severally from proceeding with the arbitration proceedings under reference no.15174/JEM pending before the 1st Respondent pending disposal of the suit. A.No.1236 of 2008: Application praying that this Hon'ble Court be pleased to stay the Arbitration Agreement clause 22 of the Joint Venture Agreement dated 30.01.2004 pending disposal of the suit. https://hcservices.ecourts.gov.in/hcservices/ A.No.2670 of 2008: Application praying that this Hon'ble Court be pleased to refer the parties to the proceedings to Arbitration in terms of section 45 of the Arbitration and Conciliation Act 1996 in C.S.No.257 of 2008. A.No.2671 of 2008: Application praying that this Hon'ble Court be pleased to vacate the interim order of injunction dated 7.3.2008 and 22.04.2008 in O.A.277 of 2008 in C.S.No.257 of 2008 passed by the Hon'ble Court. A.No.5848 of 2007: Application praying that this Hon'ble Court be pleased to refer the above suit in C.S.No.709 of 2007 to Arbitration to the international chamber of Commerce interms of Article 22 of the Joint Ventures Agreement dt.30.01.2004. For C.G.Holdings & Mr.K.C.Palaniswami : Mr.Karthik Seshadri (Appellants in O.S.A.Nos.2 to 5 of 2009 and Comp.Appeal No.27/09 RR1 and 2 in O.S.A.No.258/09, RR.1 and 2 in Comp.Appeal Nos.26 and 29/2009 RR2 and 3 in Company Appeal Nos.21 and 25/2009 For Mr.Ramaswamy Athappan and Mr.Nandakumar Athappan : Mr.J.Sivanandaraj (Appellants in Comp.Appeal Nos.25 and 26 of 2009, RR1 and 2 in O.S.A. Nos.2 to 5, RR6 and 7 in Comp. Appeal No.21 of 2009, RR4 and 6 in Comp.Appeal No.29/09 and for RR5 and 6 in Comp.Appeal No.27 of 2009) For ORE Holdings : Mr.AR.L.Sundaresan (Appellant No.2 in O.S.A.No.258 of for M/s.Aditya Bhat 2009 and Comp.Appeal Nos.21 and 29/2009, R1 in Comp.Appeal Nos.25 and 27 of 2009 and for R4 in O.S.A. Nos.2 to 4 of 2009), for Odyssey Re Holdings Corporation (R5 in O.S.A.Nos.2 to 4 of 2009), for Odyssey America Reinsurance corporation https://hcservices.ecourts.gov.in/hcservices/ (Appellant No.1 in O.S.A.No.258 of 2009, R6 in O.S.A.Nos.2 to 4 of 2009 and Comp.Appeal No.26 of 2009 and R.7 in Comp.Appeal No.29 of 2009), for Fair Fox Financial Holdings Limited (R7 in OSA.Nos.2 to 4 of 2009), for ORE Housing Pvt.Ltd., (R4 in Comp.Appeal No.26 of 2009) and for Chandran Ratnasamy (R5 in Comp.Appeal No.26/2009) For Vasantha Mills Limited : Mr.V.Lakshminarayanan (R8 in O.S.A.NOs.2 to 4 of 2009, R.4 in Comp.Appeal No.27 of 2009 and R.5 in Comp.Appeal No.21 of 2009 and for Cheran Properties Limited (R9 in O.S.A.Nos.2 to 4 of 2009, R4 in Comp.Appeal No.21 of 2009 and R3 in Comp.Appeal No.27 of 2009) Cheran Enterprises Pvt.Ltd. : Mr.C.S.K.Sathish (R.10 in O.S.A.Nos.2 to 4 of 2009, R1 in Comp.Appeal NO.21 of 2009, R3 in Comp.Appeal No.26 of 2009 and 29 of 2009 and R2 in Comp. Appeal No.27 of 2009 State Bank of India, Erode. : Mr.K.S.Sunder (R8 in Comp.Appeal No.21 of 2009) and for State Bank of India, Chennai (R9 in Comp.Appeal No.21 of 2009, R4 in Comp.Appeal No.25 of 2009 and R8 in Comp.Appeal No.27 of 2009 ABN Amro Bank, Chennai : Mr.T.Suresh (R10 in Comp.Appeal No.21/09 and Mr.O.S.Karthikeyan and R9 in Comp.Appeal No.27/09) Secretariat of Court of ICC, : No Appearance France (R.3 in O.S.A.Nos.2 to 4/11) Cheran Holdings Pvt.Ltd. : Given up (R3 in O.S.A.No.258 of 2009), Cheran Construction Ltd. : Given up (R4 in OSA.No.258 OF 2009, and R12 in Comp.Appeal No.21 of 2009, for Chenniappan Gounder (R5 in O.S.A.No.258 of 2009) https://hcservices.ecourts.gov.in/hcservices/ and for B.Gunasekaran (R6 in OSA.No.258 of 2009) Cheran Contruction Ltd., : No Appearance (R11 in Comp.Appeal No.27/09) Syndicate Bank, Karnataka : No Appearance (R10 in Comp.Appeal No.27/09 and R11 in Comp.Appeal No.21/09 COMMON JUDGMENT R.BANUMATHI,J. Whether the single Judge was right in finding that the arbitration agreement has become inoperative and whether the single Judge was right in allowing the application - A.No.1236 of 2008 granting stay of arbitration proceedings are the points falling for consideration in O.S.A.Nos.2 to 5 of 2009, which arise out of the order dated 29.10.2008 made in O.A.No.277 of 2008 and Application Nos.1236, 2670 and 2671 of 2008 respectively in C.S.No.257 of 2008 on the file of this Court. The Order of the Company Law Board dated 3.8.2009 modifying its earlier order dated 13.8.2008 in C.P.Nos.65 and 76 of 2005 and issuing various directions in modification of its earlier order is under challenge in Company Appeal Nos.21, 25 to 27 and 29 of 2009. 2. The issues involved in these Original Side appeals and Company Appeals relate to the dispute pertaining to the Joint Venture Agreement dated 30.1.2004 in relation to the affairs of M/s.Cheran Enterprises Private Limited. Since common issues are involved in the Original Side Appeals and Company Appeals, all the appeals were heard together and shall stand disposed by this common judgment. 3. For convenience, the parties are referred by their names and also in short form and wherever necessary they shall be referred as per their array in C.S.No.257 of 2008. 4. Factual background of the matter: The 10th defendant – K.C.Palanisamy (in short, "KCP"), an Industrialist from Coimbatore along with his family members had acquired controlling interest in M/s.Vasantha Mills Limited (in short, "VML") and promoted a Company in the name and style of Cherraan Properties Limited (in short, "CPL"). VML and CML owned extensive immovable properties, which are capable of being developed https://hcservices.ecourts.gov.in/hcservices/ into valuable commercial and residential properties. The 1st plaintiff – Ramasamy Athappan is known to KCP even prior to incorporation of Cheran Enterprises Private Limited (in short, "CEPL"), being the Principal Officer of 1st Capital Insurance Company, which is a group company of Odyssey America Re-Insurance Corporation (OARC), a large multinational Company, forming part of "Fairfax Group" of Companies, having its registered office in Stamford, Connnecticut at U.S.A. In 2003, R.Athappan conveyed to KCP to arrange for funding through ORE Holdings incorporated in Mauritius under Mauritius Laws promoted by OARC as its wholly owned subsidiary under the Mauritius Laws for the purpose of developing the lands belonging to VML and CPL. For a consideration of Rs.4 Crores, KCP allotted/transferred 20 percent of equity shares in CPL and 15.6% of equity shares in VML to Nandakumar Athappan as per the understanding between KCP and Ramasamy Athappan. Cheran Enterprises Private Limited came to be incorporated in November 2003 by KCP and his wife Soundari Palaniswamy with an authorised capital of Rs.10,00,000/- consisting of 10,000 equity shares of Rs.100/- each. Subsequently, in 2004, the authorised capital of the Company was increased to Rs.18,00,00,000/-. By virtue of a share purchase agreement dated 13.1.2004 entered into between C.G.Holdings and CEPL, C.G.Holdings sold 1,00,00,000 equity shares of Rs.10/- each in CPL representing 80% equity shares in CPL and 12,41,969 equity shares of Rs.10/- each in VML to CEPL. In consideration of which, C.G.Holdings was allotted 45% of the issued, subscribed and paid up capital of CEPL. Similarly, Athappan has sold his share holding in CPL and VML to CEPL and in exchange of which he was allotted 10% of the issued, subscribed and paid up capital of CEPL. 5. A Joint Venture Agreement (JVA) was executed on 30.1.2004 between (i) C.G.Holdings Private Limited; (ii) ORE Holdings Limited; (iii) Nanthakumar Athappan; (iv) Ramaswamy Athappan, (v) K.C.Palanisamy, (vi) Vasantha Mills Limited (VML), (vii) Cherraan Properties Limited (CPL) and (viii) Cheran Enterprises Private Limited (CEPL). By Joint Venture Agreement:- ➢K.C.Palanisamy brought in investment by way of contribution of properties of VML and CPL worth Rs.130 Crores to get 45% shares in CEPL. ➢ORE to hold 45% against investment of cash of Rs.75 Crores and ➢Nandakumar Athappan to hold 10 percent against investment of Rs.4 Crores. 6. As per "Business Purpose and Scope of J.V.A. (Clause 4.1), the Company has been incorporated to (i) purchase, construct and develop a hotel property, a shopping complex and an information technology park, (ii) renovate and develop properties owned by CPL and VML, and https://hcservices.ecourts.gov.in/hcservices/ (iii) sell the aforementioned properties. KCP, C.G.Holdings, VML and CPL are one group, ORE is another group and Plaintiffs – Ramasamy Athappan and Nandakumar Athappan are one group. Under JVA, ORE nominated one Chandran Ratnaswami, who lives in Canada, to act as a Director in the Joint Venture Company – CEPL. C.G.Holdings nominated K.C.Palanisamy as a Director in CEPL. 2nd Plaintiff – Nandakumar Athappan nominated his father – Ramaswamy Athappan, who lives in Singapore as a Director in CEPL. Hence, K.C.Palanisamy alone is the Indian Director and was appointed as the Managing Director of CEPL. K.C.Palanisamy, who is a former member of Legislative Assembly and also a Member of Parliament, after receiving Rs.75 Crores to the credit of CEPL is acting in violation of the terms of JVA and alleged to have misappropriated Rs.75 Crores. Contrary to the terms of JVA, K.C.Palanisamy is alleged to have subsequently encumbered the properties of CEPL by entering into collusive agreements with sister concerns. K.C.Palanisamy alleges that ORE committed breach in failing to provide guarantee to enable CEPL to obtain Syndicated credit facility of Rs.300 Crores, which is in clear violation of Article 9 of JVA. 7. Ramasamy Athappan and ORE Holdings held Board meeting of CEPL on 21.9.2005 and 22.9.2005 and rescinded the collusive agreements that were entered into by KCP with Cheran Constructions Limited (CCL). KCP was also questioned and instructed to return moneys that were misappropriated and various resolutions were passed including removal of KCP as a Managing Director and as the sole signatory of Bank account. 8. C.P.No.65 of 2005: - In November 2005, C.G.Holdings and KCP filed C.P.No.65 of 2005 under Sections 397 and 398 of The Companies Act before the Company Law Board, Southern Region Bench, Chennai to:- (i) declare that the alleged Board meetings of CEPL held on 21/22.9.2005 and the resolutions passed thereon are null and void and not binding on the C.G.Holdings, KCP and CEPL; (ii) amend the Articles of Association of CEPL to include Articles to the effect that so long as C.G.Holdings holds shares in CEPL, no policy decision to increase the authorised capital, sale, disposal or encumbrances of the investments in shares in subsidiaries such as CPL, VML, be taken up by the Company in General Meeting without the affirmative vote of C.G.Holdings; (iii) amend the Articles of Association of CEPL to include an Article that so long as C.G.Holdings and its nominees on the Board as a Director, no quorum for any meeting of the Board of Directors would be possible without the presence of such a nominee; (iv) permanent injunction restraining Chandran Ratnasamy and https://hcservices.ecourts.gov.in/hcservices/ Ramasamy Athappan or the nominees of ORE Holdings and Nandakumar Athappan from proceeding with the holding of the meeting of Board of Directors of CEPL on 12.11.2005 and other reliefs. 9. C.P.No.76 of 2005:- ORE Holdings Limited filed this Petition before the Company Law Board under Sections 397 and 398 of the Companies Act for various reliefs alleging acts of mismanagement and suppression by KCP in his capacity as a Managing Director and C.E.O. of CEPL. In the said Petition, ORE Holdings Limited prayed for:- (i) removal of KCP as a Director, C.E.O., and the Managing Director of the Company; (ii) restraining C.G.Holdings and KCP or their nominees from in any manner acting on behalf of CEPL (iii) constituting a Board of Management for the Company consisting of independent Directors and nominees of ORE Holdings; (iv) direct CEPL and other respondents to give effect to the resolutions passed by the Board in its meeting dated 12.11.2005; and (v) set aside all contracts entered by or on behalf of subsidiaries in violation of the provisions of JV Agreement and other reliefs. 10. The Company Law Board heard C.P.Nos.65 and 76 of 2005 together and with a view to bring an end to the grievance of C.G.Holdings, KCP, ORE and Athappan on 13.8.2008 in exercise of the powers under Sections 397 and 398, passed the following order: "CEPL shall return a sum of Rs.75 crores and Rs.4 crores invested by ORE and Athappan respectively, together with simple interest at the rate of 8% per annum from the date of investment till the date of repayment within a period of 12 months in one or more instalments, commencing from 01.11.2008. While making the payment CEPL, CG Holdings and KCP shall ensure that at least 25% of the amount due is paid in every quarter. CEPL, CG Holdings and KCP are at liberty to make use of the fixed deposit held by CEPL with SBI Erode Main Branch, free of any liens or encumbrances towards refund of the investments of ORE and Athappan. VML shall not alienate or sell any of its immovable properties till full payment is made to ORE, in terms of this order. In the event of any failure to make the repayment within the specified time, CEPL, CG Holdings, KCP and VML will duly convey the immovable properties of VML, namely, 17.15 acres of land in favour of ORE and 7.80 acres of land in favour of Athappan by executing and registering necessary deeds of conveyance in strict compliance with all applicable laws, as consideration for reduction of capital and surrender of the shares of ORE and Athappan, upon which ORE as well as Athappan will deliver the share certificates and blank https://hcservices.ecourts.gov.in/hcservices/ transfer forms in respect of their holdings in CEPL and the subsidiaries, if any, in favour of CG Holdings and KCP. CEPL is consequently authorized to reduce its share capital and in the meantime, operation of the impugned agreements is suspended to expedite and ensure due completion of the modalities of exit by ORE and Athappan, thereby, bringing to an end the acts complained of in the present proceedings. CEPL shall ensure necessary statutory compliances till the whole process, in accordance with the aforesaid directions, is properly completed. The parties are at liberty to apply in the event of any difficulty in implementation of the smooth exit of ORE and Athappan from CEPL." 11. Even when the matters were being pursued before the Company Law Board, VML, CPL, C.G.Holdings and KCP have initiated various civil and criminal proceedings. VML, CPL and KCP filed Civil Suit – O.S.No.90 of 2007 on the file of District Munsif's Court, Kangeyam seeking for declaration that allotment of shares in favour of Nandakumar Athappan in CEPL, VML and CPL is tainted by fraud and misrepresentation and also null and void and consequently to restrain Nandakumar Athappan by way of permanent injunction not to alienate or sell or pledge the shares allotted to him and not to exercise his voting rights in CEPL and VML and Ramasamy Athappan not to function as a Director of CEPL. 12. C.G.Holdings, KCP and his father Chenniappan have filed six criminal complaints against the plaintiffs – Ramasamy Athappan and Nandakumar Athappan. Conversely, Plaintiffs and other parties to the JVA have also filed three criminal complaints against C.G.Holdings and KCP for misappropriation of funds, forgery of minutes/resolutions and fabrication of accounts. KCP was arrested and remained in custody for 87 days. Even when the parties were seriously pursuing the Petitions before the Company Law Board and other proceedings, in 2007, C.G.Holdings and KCP wrote to the Secretary of the Court of International Chamber of Commerce (ICC) making a "Request for Arbitration" seeking for declaration that the JVA dated 30.1.2004