(1.)The respondents filed CA No. 149/2016 under section 8 of Arbitration and Conciliation Act, 1996, for dismissal and reference of this CP to arbitration for the parties and the subject-matter in this CP are governed by arbitration clause 10.12 of share purchase agreement ('SPA') dated 2nd November, 2015 executed in between Poonam Drums & Containers (P.) Ltd. (Rl-company), Rehana Praveen Chaudhary (the petitioner) and Izaz Ahmed M. Chaudhary (R2), the Arbitration Clause in the SPA is read as follows:
"....10.12 Dispute resolution:
10.12.1 Any dispute, claim or controversy arising under or relating to the agreement, including without limitation any dispute concerning the existence or enforceability hereof, shall be resolved by Arbitration and Conciliation Act 1996.
10.12.2 Notwithstanding anything contained in the agreement to the contrary, the parties to the agreement hereby agree that they intend to discharge their obligations in utmost good faith. Therefore, the parties agree that they will, at all times, act in good faith, and make all attempts to resolve all differences, howsoever arising out of or in connection with the agreement by way of each appointing one nominee/representative who shall discuss in good faith to resolve the differences (Amicable Settlement). In case the Amicable Settlement does not resolve the dispute within 30 days calendar days, it shall be referred in accordance with this clause 10.12.
10.12.3 All disputes and differences arising out of or in connection with any of the matters set out in the Agreement, if not resolved by Amicable Settlement, shall be settled by a sole arbitrator to be appointed by the parties to the dispute, if the parties to the dispute are unable to appoint a sole arbitrator by way of mutual consent, the sellers shall together appoint one arbitrator, the purchaser and the company shall appoint one arbitrator and the two arbitrators so appointed shall be entitled to appoint the third arbitrator who will act as umpire of the arbitral tribunal.
10.12.4 The arbitrator shall reach and render a decision in writing with respect to the appropriate award to be rendered or remedy to be granted pursuant to the dispute.
10.12.5 To the extent practical, the decisions of the arbitrator shall be rendered no more than 30 days following commencement of proceedings with respect thereto. The arbitrator shall cause its written and reasoned decisions to be delivered to the parties.
10.12.6 the arbitrator shall be entitled to costs of arbitration. Subject to the aforesaid, each party to any arbitration shall bear its own expense in relation thereto, including but not limited to such party's attorneys' fees and expenses and fees of the arbitrator shall be born equally by parties to the dispute.
10.12.7 The language of the arbitration shall be English and place of arbitration shall be Mumbai."
Before going into merits of this CA under section 8, the petitioner case is summarised as below: R1-company was incorporated on 14th October, 1983 for manufacturing, producing, processing, making, fabricating dealing and distributing all types of drums, barrels, containers of different sizes made from mild steel. The authorised share capital, as on the date of filing this company petition is Rs. 6,00,00,000/- divided into 6,00,000 equity shares of Rs. 100/- each with a paid up capital of 5.2 crore divided into 5.2 lakh equity shares of Rs. 100/-, wherein the petitioners and her family members held 50.95 per cent shareholding. As against this, the answering respondents held the remaining shareholding in the company. The petitioner continued as director of the company since 19th January, 2012 until 25th February, 2015.
(2.)According to the petitioner, R2 approached the petitioner in 1983 and then started this business together starting as directors of the company. The company has factory at Khopoli (in Maharashtra) and Dera Bassi (Punjab) and a plot of land at Panoli (Gujarat) for future expansion. The Factory has strength of more than 100 employees with regular customers like Asian Paints, Pidilita Industries, BASF India Ltd. The main grievance of the petitioner is R2 and R3, continuing in the management, have not been allowing the petitioner to know inside information of the company. Adding grievance is, when the petitioner health became deteriorated by Kidney problem and owing to uncalled behaviour of R2, she resigned from the directorship of the company on 25th May, 2015. The company being mounted with dues, R2 approached BIFR without keeping the petitioner in loop.
(3.)While the petitioner was suffering from her health problem and being kept in dark, the petitioner says, R2 started pressing the petitioner to sell her shareholding to the answering respondent, succumbing to the pressure of answering respondents, the petitioner executed SPA in favour of R2 on 2nd November, 2015 on the assurance that R2 would pay and discharge the bank liabilities relieving the petitioner from the claim of the bank, but to the surprise of her, she received a demand notice on 16th March, 2016 from the Bank of India recalling the dues of the company amounting to Rs. 37,41,75,836/-. Looking at R1-company being classified as NPA, she has been time and again requesting the company to furnish the details of the business, but R2, till date, has not furnished any information in respect to the business of the company. Furthermore he has not even been complying with the terms and conditions of the SPA dated 2nd November, 2015. She further submits R2, in breach of BIFR order sold valuable property belonging to the company at Plot No. 209/210 Panoli Industrial Estate, GIDC, Village Sanjali, Gujarat to the prejudice of the company and its shareholders. When she visited Panoli in the first week of August 2016 she was surprised to see some new constructions on the said premises. On her further inquiries, she has learnt that the factory was already sold to some company for an amount of Rs. 4 crore by R2 without even putting it to her notice. After being aware of all these acts of R2, when she went to the office of R1 to know about nonpayment of bank dues and illegal sale of property, the respondents side turned down her request and framed a false case of theft against her. Apart from these, the petitioner submits, since the company has not made statutory filings and payments, the petitioner filed this company petition primarily asking two reliefs: (2) to direct the company to convene EGM to appoint the petitioner or her nominee as director of the company, and (2) to declare the purported sale of property belonging to R1 at Plot 209/210, Panoli Industrial Estate, GIDC, Village Sanjali, Gujarat as null and void.