MR. VIKRAM BAKSHI & ORS.versusMS. SONIA KHOSLA (DEAD) BY LRS.

                         [2014) 6 S.C.R. 762

A                   MR. VIKRAM BAKSHI & ORS.
                                   v.
              MS. SONIA KHOSLA (DEAD) BY LRS.
        (Special Leave Petition (Criminal) No. 6873 of 2010
                            MAY 08, 2014
B
        [SURINDER SINGH NIJJAR AND A.K. SIKRI, JJ.)

           Company law: Collaborative agreement - Two groups
    joined together for collaborative business venture - Dispute
C   between them with regard to appointment of Director and
    shareholding - Company petition before the Company Law
     Bo.ard (CLB) - Interim order made by CLB - Stay of interim
     order by High Court - Challenged - Contempt petitions and
    petitions u/s.340 Cr.P.C. also filed - Held: Numerous cases
D   pending between the two groups including contempt petitions
     (civil or criminal) and petitions u/s. 340 Cr. P. C. -· There is
    complete deadlock so far as affairs of the company are
    concerned and unless the parties reconcile there is no chance
     of joint venture - Suggestion made by one Group for earl~
E    decision of Company Petition before the CLB as a bette
     alternative so that at least main dispute between the parties
     is adjudicated at the earliest - The other group agreeing to
     this course of action - In view of agreement between both the
    parties on the procedural course of action to give quietus to
F    the matters, SLP, Contempt petitions and petitions u/s.340,
     Cr. P. C. disposed of - CLB directed to decide Company
     Petition within 6 months - Parties to maintain .status quo
     during pendency of Company Petition - Alternative Dispute
     Resolution.

G         Alternative Dispute Resolution: Mediation - Purpose and
    benefits of - Discussed - Code of Civil Procedure, 1908 -
    s.89.

         The respondents-K group and the petitioners~B
H                          762
VIKRAM BAKSHI & ORS. v. SONIA JSHOSLA (DEAD) 763
                  BY LRS.
Group joined together for collaborative business venture.       A
Owing to certain problems between the tWo groups, the
project came to stand still. K Group filed petition under
Sections 397 and 398 of the Companies Act against the
B Group praying for an order for removal of the
petitioners from the Board of Directors of the company          B
and that directions of B Group had ceased to be Directors
on 30.9.2006 since they were not confirmed in the AGM
of the Company.

    Meanwhile, on 18.12.2007, a meeting was held by the         C
K Group where the Board of the company appointed
Directors of the company from K Group and allottecj 6.58
lakh equity shares to eleven persons of K Group. ·
    The Company Law Board (CLB) passed orders dated
31.1.2008 directing the maintenance of status quo with          D
regard to the shareholding and the Directors of the
Company as it existed on the date of the filing of th"e
petition i.e. 13.8.2007. Observations were made in this
order that the respondent-SK had tried to overreach the
CLB by changing composition and to increase the share           E
capital of the Company. Respondent-SK filed applications
under Section 340, Cr.P.C. before the CLB alleging that
certain forged documents were filed by B Group before
the CLB. The High Court stayed the operation of order
dated 31.01.2008. Hence these SLPs. Contempt petitions
                                                                F
and petition under Section 340 Cr.P.C. were also filed.
     Disposing of the SLPs, contempt petition and
petition under section 340, CrPC, the Court
     HELD: 1. More than 80 cases are pending between
the parties. Most of these do not even touch the main           G
dispute as they are in the nature of either Contempt
Petitions, (Civil or Criminal) or petitions under Section 340
Cr. P.C. etc. It would have been more appropriate for the
parties to atleast agree to resort to mediation as provided
under Section 89 of CPC and make an endeavour to fif']d         H
    764     SUPREME COURT REPORTS            [2014] 6 S.C.R.


A amicable solution of the dispute, agreeable to both the
  parties. One of the aims of mediation is to find an early
  resolution of the dispute. The sooner dispute is resolved
  the better for all the parties concerned, in particular, and
  the society, in general. For parties, dispute not only
B strains the relationship but also destroys it. And, so far
  as society is concerned it affects its peace. So what is
  required is resolution of dispute at the earliest possible
  opportunity and via such a mechanism where the
  relationship between individual goes on in a healthy
c manner. [Paras 13 and 15] [755-A-B-E-H]
         2. MEDIATION is one such mechanism which has
    been statutorily brought into place in Indian Justice
    System. It is one of the methods of Alternative Dispute ·
    Resolution and resolves the dispute in a way that is
D   private, fast and economical. It is a process in which a
    neutral intervener assists two or more negotiating parties
    to identify matters of concern, develop a better
    understanding of their situation, and based upon that·
    improved understanding, develop mutually acceptable
E   proposals to resolve those concerns. It embraces the
    philosophy of democratic decision-making. Thus,
    mediation being a form of Alternative Dispute Resolution
    is a shift from adversarial litigation. When the· parties
    desire an on-going relationship, mediation can build and
F   improve their relationships. To preserve, develop and
    improve communication, build bridges of understanding,
    find out options for settlement for mutual gains, search
    unobvious from obvious, dive underneath a problem and
    dig out underlying interests of the disputing parties,
G   preserve and maintain relationships and collaborative
    problem solving are some of the fundamental advantages
    of mediation. Even in those cases where relationships
    have turned bitter, mediation has been able to produce
    positive outcomes, restoring the peace and amity
H   between the parties. [Paras 15 and 16] [776-B-G]
  VIKRAM BAKSHI & ORS. v. SONIA KHOSLA (DEAD) 765
                    BY LRS.
       3. There is always a difference between winning,a         A
  case and seeking a solution. Via mediation, the parties
  will become partners in the solution rather than partners
  in problems. The beauty of settlement through mediation
  is that it may bring ab.out a solution which may not only
  be to the satisfaction of the parties and, therefore, create   B
  a win win situation, the outcome which cannot be
  achieved by means of judicial adjudication. Thus, life as
. well as relationship goes on with Mediation for all the
  parties concerned and thus resulting into peace and
  harmony in the society. While providing satisfaction to        c
  the litigants, it also solves the problem of delay in our
  system and further contributes towards economic,
  commercial and financial growth and development of the
  country. [Para 17] [776-G, H; 777-A-B]

      4. Mediation is new dimension of access to justice. D
 As it is one of the best forms, if not the best, of conflict·
 resolution. The concept of Justice in mediation is
 advanced in the oeuvres of Professors Stulberg, Love,
 Hy~an, and Menkel-Meadow (Self-Determination
 Theorists). Their definition of justice is drawn primarily E
 from the exercise of party self-determination. They are
 hopeful about the magic that can occur when people
 open up honestly and empathetically about their needs
 and fears in uninhibited private discussion. And, as
 thinkers, these jurists are optimistic that the magnanimity F
 of the human spirit can conquer structural imbalances
 and resource constraints. Mediation ensures a just
 solution acceptable to all the parties to dispute thereby
 achieving 'win-win' situation. It is only mediation that puts
 the parties in control of both their disputes and its G
 resolution. It is mediation through which the parties can
 communicate in a real sense with each other, which they
 have not been able to do since the dispute started. It is
 mediation which makes the process voluntary and does
 not bind the parties against their wish. It is mediation that H
    766       SUPREME COURT REPORTS            [2014] 6 S.C.R.


A saves precious time, energy as well as cost which can
  result in lesser burden on exchequer when poor litigants
  are to be provided legal aid. It is mediation which focuses
  on long term interest and helps the parties in creating
  numerous options for settlement: It is mediation that
B restores broken relationship and focuses on improving
  the future not of dissecting past. It is based on an
  alternative set of values in which formalism is replaced
  by informality of procedure, fair trial procedures by direct
  participation of parties, consistent norm enforcement by
c norm creation, judicial independence by the involvement
  of trusted peers, and so on. This presents an alternative
  conceptualization of justice. [Para 18] [777-C-E; 778-F-H;
  779-A-B]

         5. A plea was made on behalf of B ·Group to invoke
D the provisions of Article 142 of the Constitution and put
    an end to the entire litigation between the parties pending
    in various courts by putting the parties to such terms,
    which this court finds to be equitable for both the parties.
    On behalf of B Group, an offer to surrender/give 50% of
E land to the K Group and also an amount of Rs. 6.40
    Crores was made. As there are many cases of different
    nature pending in different courts it is not possible to
    exercise powers under Article 142 of the Constitution and
    to resolve all those cases. The dispute which has arisen,
F out of MOU/collaboration agreement between the parties
    is not unique or unprecedented. Such type of differences
    do arise. Day in and day out there are litigations of the
    kind which is filed'in the CLB by the petitioner. However,
    what is unprecedented is the monstrous proportions
G which this litigation has assumed with the multiplication
 ·-,~of proceedings between the parties today which arose
    out of one petition before the CLB. [Para 20] [779-D-H;
    778-A-B]

          6. A suggestion was made on behalf of K Group for
H
VIKRAM BAKSHI & ORS. v. SONIA KHOSLA (DEAD) 767
                  BY LRS.
an early decision of the Company Petition before the CLB       A
as a better alternative so that at least main dispute
between the parties is adjudicated upon at an early date.
It was submitted that the issues which are subject matter
of these two Special Leave Petitions and arise out of the
proceedings in the High Court, have their origin in the        B
orders dated 31.1.2008, which is an interim order passed
by the CLB and once the Company Petition itself is
decided, the issues involved therein namely whether
Board meeting dated 18.12.2007 was illegal or whether
Board meeting dated 30.9.2006 was barred in law would          c
also get decided. In the process the CLB would also be
in a position to decide as to whether minutes of AGM of
the Company allegedly held on 30.9.2006 are forged or
not -and on that basis application under Section 340 Cr.
PC which is filed before the Company Law Board would           D
also be taken care of by the CLB itself. B Group
immediately agreed with the aforesaid course of action'
suggested on behalf of K Group. Thus, at least there is
an agreement between both the parties on the
procedural course of action, to give quietus to the
matters as ·well. In view of the consensus, about the          E
course of action to be adopted in deciding the disputes
between the parties, the Company Law Board is directed
to decide the Company Petition filed before it by
respondent-SK within a period of six months from the
date of receiving a copy of tbis order. Since, it is the CLB   F
which will be deciding the application under Section 340
Cr. PC filed by respondent-SK in the CLB, High Court
need not proceed further with the Criminal Misc .. Likewise
the question whether as the appointment of director from
K Group would be gone into by the CLB, the proceedings         G
in Co. Appeal No. in the High Court, also become otiose.
[Para 21] [780-D-H; 781-A-C]

    7. The B Group. wants orders dated 31.1.2008 passed
by CLB to continue the interregnum. The K Group on the         H
    768     SUPREME COURT REPORTS             [2014] 6 S.C.R.


A other hand refers to orders dated 11.4.2008 as it is their
  submission that this was a consent order passed by the
  High Court after the orders of the CLB and, therefore, this
  order should govern the field in the meantime. It is not
  necessary to either enforce orders dated 31.1.2008
s passed by the CLB or orders dated 11.4.2008 passed by
  the High Court. Fact remains that there has been a
  complete deadlock, as far as affairs of the Company are
  concerned. The project has not taken off. It is almost
  dead at present. Unless the parties re-concile, there is no
c chance for a joint venture i.e. to develop the resort, as per
  the MOU dated 21.12.2005. It is only after the decision of
  CLB, whereby the respective rights of the parties are
  crystallised, it would be possible to know about the
  future of this project Even the Company in question is
D also defunct at present as it has no other business
  activity or venture. In a situation like this, more
  ap:propriate orders would be to direct the parties to
  maintain status quo in the meantime, during the
  pendency of the company petition before the CLB.
  However, if any exigency arises necessitating some
E interim orders, it would be open to the parties to
  approach the CLB for appropriate directions. [Paras 22,
  23] [781-D-H; 782-A]

         CRIMINAL APPELLATE JURISDICTION: Special Leave
F   Petition (Criminal) No. 6873 of 2010)

        From the Judgment and Order dated 15.02.2010 in CRM
    No. 3/2008 of the High Court of Delhi at N. Delhi.

                              WITH
G
    SLP (C) No. 23796-23798 of 2010

    CONMT. PET. (CRL) No. 4 of 2013

    · Vikash Singh, Nidesh Gupta, J.P Gama, Rajeev Sharma,
H Uddyam Mukherjee, Sahil Bhalaik, Manoj, Apa'rna Sinha,
VIKRAM BAKSHI & ORS. v. SONIA KHOSLA (DEAD} 769
                  BY LRS.
Abhijat P. Medh, Shashi Mohan for the appearing parties,                A
Deepak Khosla (Petitioner-In-Person for Conmt. Pet. (Crl.) 4/
13), (Respondent-In Person for SLP (C) 23796-98/10).

     The Judgment of thei Court was delivered by

     A.K. SIKRI, J. 1. A spate of litigation between the two            B
groups depicts a severe fight between them where settlement
appears to be a distant dream, at least as of now, with tough
positions taken and on each and every facet/ nuance of the
disputes, they have joined issues. However, we are happy to
find consensual approach on one aspect at least viz. the future         C
course of action that needs to be adopted in these matters
which have landed in this Court (albeit against interim orders)
as the proceedings are still pending at different levels either in
the Company Law Board or in the High Court. This much
positive stance, aimed at cutting the corners and edging out            D
the niceties for early resolution of the main dispute between the
parties needs to be commended. For this reason, apart from
stating the controversy involved in each of the matters, our
purpose would be served in stating the course of action which
needs to be adopted, as agreed between the parties, without             E
going into the nitty gritty of the issues involved. With this
introduction we describe hereinbelow the nature of the dispute
in these petitions.

SLP(Crl) No. 6873 of 2010
                                                                        F
     2. When the two parties joined together for collaborative
business venture, it is but natural that the relationship starts with
mutual trust and faith in each other. At the time of fostering such
a relationship, they expect that with joint efforts in the proposed
business venture, they would be able to achieve unparallel              G
milestones, which would otherwise be impossible with their
individual efforts. The joining together is with the aim of making
one plus one as eleven and not two. However, over a period
of time, if due to unfortunate and unforeseen circumstances/
events, the relaNonship becomes bitter and the two                      H
    770       SUPREME COURT REPORTS                [2014) 6 S.C.R.
                    \'#'
               -~;~ -~:.

A   collaboratfVe partners fall apart, it results in a position where
    one .minus one is not only reduced to zero but becomes
    negative. That perhaps is the story of the present litigation and
    if the disputes are not resolved early, either by adjudicatory
    process or amicably between the parties, the negative factor
B   will keep growing and keep widening its fangs which may not
    be conducive to any of the litigants before us. 3. The
    respondents herein (hereinafter referred to as the Khosla
    Group) are the owners of the prime lands in Kasauli, District
    Solan, Himachal Pradesh. Legally, this land is owned by
c   Montreaux Resort Pvt. Ltd. (MRL, for short) and share holding
    of the· MRL was earlier exclusively held by the family members
    of the Khosla Group. It was their vision to develop this real
    estate into a tourist resort of repute. The Khosla group needed
    requisite finances and administrative expertise for this purpose.
    The petitioners (hereinafter referred to as the Bakshi Group)
0
    extended its helping hand. In, fact it was conceived as a dream
    project of both the groups. For th.is purpose MOU dated
    21.12.2005 was entered into between Mr. Deepak Khosla, Mr.
    R.P. Khosla, MRL and Mr. Vikram Bakshi. The project "{as joint
E   venture between the Khosla Group and Mr. Vikram Bakshi
    wherein the Bakshi Group was to pump in the necessary
    finances and to take charge of administration by managing the
    entire project. MRL was the special purpose vehicle for the
    execution of the project. The MOU envisaged transfer of
    shareholding in MRL by Khosla Group to Vikram Bakshi on
F   certain demands made by the latter to the former. 4.Pursuant
    to the MOU dated 23.12.2005, Mr. Vinod Surah and Mr. Wadia
    Prakash (nominees of Mr. Vikram bakshi) were appointed as
    Additional Directors of MRL. An agreement dated 31.3.2006
    was entered, for executing the proposed project, between the
G   respondent, Ms. Sonia Khosla, wife of Mr. Deepak Khosla, Mr.
    R.P. Khosla, MRL and Mr. Vikram Bakshi. The agreement
    recorded that 51% shareholding in the company had been
    transferred to Mr. Vikram Bakshi. The said agreement, inter
    alia, provided that:
H
VIKRAM BAKSHI & ORS. v. SONIA KHOSLA (DEAD) 771
           BY LRS. [A.K. SIKRI, J.]
      (a)   Land for the project shall be purchased in the name · A
            of MRL.

      (b)   The responsibility of development of lands,
            managing the project and arranging finances would
            be that of Mr. Vikram Bakshi.
                                                                      B
      (c)   Khosla's would be paid a total consideration of Rs.
            6.44 crores on completion of different milestones
            of which an amount of Rs. 3.30 crores was to be
            as a loan bearing interest@ 12% per annum.
                                                                      c
      (d)   Khosla's would sell their entire shareholding in MRL
            to Mr. Vikram Bakshi.

      5. For some reasons (both the groups have their own
versi.on in this behalf with blame game against each other) the       D
project did not kick off and ran into rough weather with the
sowing of the seeds of mutual distrust and lack of faith. It led
to filing of a, petition under Section 397 and 398 of the
Companies Act by Ms. Sonia Khosla against Bakshi Group,
though in that petition she impleaded some of the members of
Khosla family also as respondents (may be performa                    E
respondents). Her allegation was that she held 49% shares in
the Company which had been further reduced to 36% and that
the affairs of the Company were being managed in a manner
·oppressive to the minority shareholders. In this petition she
admitted that majority shareholding was with Mr. Vikram Bakshi.       F

     6. The relief prayed for in the said petition, inter alia, was
for passing an order for removal of the petitioners from the
Board of Directors of the Company. Various miscellaneous
applications came to be filed in the aforesaid petition. Notably      G
among those was an application 1.1nder Section 8 of the
Arbitration and Conciliation Act filed by Mr. Vikram Bakshi. Mr.
Vineet Khosla also filed an application claiming himself to be
the Director of the Company and alleging that Mr. Wadia
Prakash and Mr. Vinod Surah had ceased to be the Directors            H
    772      SUPREME COURT REPORTq               [2014) l? S.C.R.


A   of the Company on 30.9.2006 since they were not confirmed
    in the AGM of the Company and, therefore, the subsequent
    appointment of Mr. Vikram Bakshi by the Board was bad in law.

        7. Another significant development which took place was
B that on 18.12.2007 purported meeting of the Company was held
  by Ms. Sonia Khosla and Mr. Vinay Khosla wherein Mr. Deepak·
  Khosla and Mr. R.K. Garg were appointed as the Directors of
  the Company and in this meeting the Board of the Company
  allotted 6.58 lakhs equity shares to eleven persons of the Khosia
C Group. It hardly needs to be mentioned that the Bakshi Group
  contenc;ls that this alleged meeting on 18.12.2007 was of
  illegally constituted Board. The Bakshi Group ~lso taken the
  position that Mr. Wadia Prakash and Mr. Vinod Surah continue
  to be legally appointed Directors and likewise appointment of
  Mr. Vikram Bakshi by the Board of the Company was also as
D per law.

       8. The Company Law Board (CLB) passed orders dated
  31.1.2008 directing the maintenance of sfatus quo with regard
  to the shareholding and the Directors of the Company as it
E existed on the date of the filing of the petition i.e. 13.8.2007.
  Observations were. made in this order that the respondent-
  Sonia Khosla had tried to overreach the CLB by changing it
  composition and to increase the.share capital of the Company.

        9. Aggrieved by this order of the CLB, Mr. R.P. Khosla
F filed the appeal in the High Court of Delhi. However, he sought
  permission to withdraw the appeal. On 11.4.2008, noticing that
  the parties had agreed that C.P. No. 114/2007 is to be
  withdrawn and the status quo as on the date of filing of the said
  petition would be maintained, the said C.P. was dismissed as
G withdrawn. Sonia Khosla had also filed appeal against the
  same very order' dated 31.1.2008 of the CLB. This was also
  dismissed by the High Court on 22.4.2008, albiet on merits.
  Both Mr. R.P. Khosla as well as Sonia Khosla filed Review
  Petitions seeking review of orders dated 11.4.2008 and
H 22.4.2008 respectively. These Review Petitions were also
 VIKRAM. BAKSHI & ORS. v. SONIA KHOSLA (DEAD) 773
             BY LRS. [A.K. SIKRI, J.]
dismissed on 6.5.2008.                                                  A

       10. As the things stood at that stage, the effect of the
 aforesaid proceedings was that the order dated 31.1.2008
·passed by CLB continued to operate. It is at that stage, the
 litigation started taking a different turn altogether.         ·B

         11. Ms. Sonia Khosla filed an application under Section
· 340 of the Code of Criminal Procedure (Cr.PC) before the CLB
  alleging that forged documents were filed before the CLB.
  However, while this application is still pending before the CLB,
. in October, 2008 she filed another application under Section          C
  340 Cr. PC in the High Court of Delhi on the same very_ grounds
  which were taken in the application before CLB. She sought
  prosecution of the petitioners under Section 195(i)(b)(ii) read
  with Section 340 Cr. PC alleging that the minutes of the AGM
  of the Company allegedly held on 30.9.2006 were forged. The           D
  reason given therein to approach the High Court was that she
  was forced to file the petition in the High Court as there was a
  complete inaction on the part of CLB on her application before
  it. ·She sought to rest her application on sub-section 2 of Section
  340 Cr. PC for its maintainability in the High Court. In this         E
  application orders dated 15.2.2010 are passed by the High
  Court and that order is the subject matter of challenge in the
  present proceedings. As can be easily discerned, the
  petitioners" main contention is that application u/s 340 Cr. PC
  is not maintainable.                                                  F

SLP(C)No. 23796-98 of 2010

     12. As mentioned above, in the Company Petition filed by
Ms. Sonia Khosla interim orders dated 31.1.2008 were passed
by the CLB directing the parties to maintain status quo with            G
regard to shareholding and the Directors of the Company as it
existed on the date of filing of the Company Petition i.e.
13.8.2007. The consequences thereof was not to give effect
to the purported Board meeting of the Company on 14.12.2007
wherein Mr. Deepak Khosla and Mr. R.K. Garg were inducted               H
    774      SUPREME COURT REPORTS                [2014] 6 S.C.R.


A   as Directors and there was also an allotment of 6.58 lakhs
    equity shares to the persons of Khosla Group. Further, as
    mentioned above this order was challenged both by R.P.
    Khosla as well as Ms. Sonia Khosla by filing appeal in the High
    Court. Whereas appeal filed by Mr. R.P. Khosla was dismissed
B   on 11.4.2008, the appeal of Ms. Sonia was dismissed on
    merits on 22.4.2008 and the Review Petitions filed by both of
    them were also dismissed on 6.5.2008. However, Mr. R.K.
    Garg who was taken as Director in the purported meeting held
    on 14.12.2007 also felt aggrieved by the order of the CLB. The
c   effect of the status quo ante order was that he could not be
    treated as the Director of the Company during the subsistence
    of the said order. Mr. R.K. Garg challenged this order by filing
    a writ petition in the High Court of Delhi on 26.2.2008. In that
    writ petition orders of status quo were passed on 7.4.2008
    However, on 9.4.2009, Mr. R.K. Garg (Respondent No. 1
0
    herein) withdrew this petition as alternate remedy of filing
    appeal against the impugned order of the CLB is provided
    under Section 10 F of the Companies Act. After withdrewing
    the writ petition the Respondent No. 1 filed Co. Appeal No. (SB)
    23 of 2009. In this appeal the company judge of the High Court
E   has passed orders dated 13.4.2010 issuing notice in the said
    appeal, in the application for condonation of delay as well as
    in the stay application. ?imultaneously, the High Court has also
    stayed the operation of the orders dated 31 .1.2008 passed by
    CLB in so far as it has cancelled the shareholding and
F   Directorship of Respondent No. 1. The instant present Special
    Leave Petition impugns the aforesaid order dated 13.4.2010
    passed by the High Court, primarily on the ground that since
    the appeal is time barred till the delay is condoned there is no
    appeal in the eyes of law and, therefore, the High Court could
G   not have passed interim orders.

       13. Though the aforesaid two SLP's are the main
  proceedings before us, even in these proceedings Contempt
  Petitions and petitions under Section 340 Cr. PC are filed.
H Moreover, narration of the events disclosed above would
 VIKRAM BAKSHI & ORS. v. SONIA KHOSLA (DEAD) 775
            BY LRS. [A.K. SIKRI, J.]
demonstrate that main proceedings are the Co. Petition filed               A
by.Ms. Sonia Khosla under Section 397-98 of the Companies
Act before the CLB where issues relating to the affairs of the
Company are to be thrashed out. Howev~r. from this on case,
number of other proceedings have sprung up. In fact, as of
today more than 80 cases are pending between the parties.                  B
Most of these do not even touch the main dispute as they are
in the nature of either Contempt Petitions, (Civil or Criminal)
or petitions under Section 340 Cr. PC etc.

     14. As stated in the beginning of this order, though it was           C
going to be collaborative efforts of the two groups in developing
a dream project and for certain reasons the parties have drifted
apart, one legal action which was triggered with the filing of the
Company Petition by Ms. Sonia Khosla before the CLB, has
today swollen into an acrimony of gigantic proportion. With all
these incidental and peripheral proceedings, which are allowed             D
to take centre stage, the main dispute which is the subject
matter of company petition before the CLB has taken a back
seat. There have been attempts made on different levels, during
court proceedings, to see whether there could be amicable
resolution of the disputes between the parties. However, as on             E
date these attempts have been of no avail.

        15. According to us it would have been more appropriate
  for the parties to atleast agree to resort to mediation as
  provided under Section 89 if CPC and make an endeavour to                F
  find amicable solution of the dispute, agreeable to both the
  parties. One of the aims of mediation is to find an early
  resolution of the dispute. The sooner dispute is resolved the
  bette>r for all the parties concerned, in particular, and the society,
. in general. For parties, dispute not only strains the relationship       G
1
  but also destroy it. And, so far as society is concerned it affects
  its peace. So what is required is resolution of dispute at the
  earliest possible opportunity and via such a mechanism where
  the relationship between individual goes on in a healthy manner.
  Warren Burger, once said:
                                                                           H
    776       SUPREME COURT REPORTS                [2014) 6 S.C.R.


A         "The obligation of the legal profession is... to seive as
          healers of human conflict ... (we) should provide
          mechanisms that can produce an acceptable result in
          shortest possible time, with the least possible expense
          and with a minimum of stress on the participants. That
B         is what justice is all about."

       MEDIATION is one such mechanism which has been
  statutorily brought into place in our Justice System. It is one of
  the methods of Alternative Dispute Resolution and resolves the
C dispute in a way that is private, fast and economical. It is a
  process in which a neutral intervener assists two or more
  negotiating parties to identify matters of concern, develop a
  better understanding of their situation, and based upon that
  improved understanding, develop mutually acceptable
  proposals to resolve those concerns. It embraces the
D philosophy of democratic decision-making [Alfin, et al.,
  Mediation theory & Practice, (2nd Ed. 2006) Lexis Nexis.           '

        16. Thus, mediation being a form of Alternative Dispute
  Resolution is a shift from adversarial litigation. When the parties
E desire an on-going relationship, mediation can build and
  improve their relationships. To preserve, develop and improve
  communication, build bridges of understanding, find out options
  for settlement for mutual gains, search unobvious from obvious,
  dive underneath a problem and dig out underlying interests of
F the disputing parties, preserve and maintain relationships and
  collaborative problem solving are some of the fundamental
  advantages of mediation. Even in those cases where
  relationships have turned bitter, mediation has been able to
  produce positive outcomes, restoring the peace and amity
G between the parties.

       17. There is always a difference between winning a case
  and seeking a solution. Via mediation, the parties will become
  partners in the solution rather than partners in problems. The ..
  beauty of settlement through mediation is that it may bring about
H a solution which may not only be to the satisfaction of the
VIKRAM BAKSHI & ORS. v. SONIA KHOSLA (DEAD) 777
           BY LRS. [A.K. SIKRI, J.]
parties and, therefore, create a win win situation, the outcome        A
which cannot be achieved by means of judicial adjudication.
Thus, life as well as relationship goes on with Mediation for all
the parties concerned and thus resulting into peace and
harmony in the society. While providing satisfaction to the
litigants, it also solves the problem of delay in our system and       B
further contributes towards economic, commercial and financial
growth and development of the country.

      18. This Bench is of firm opinion that mediation is new
dimension of access to justice. As it is one of the best forms,
if not the best, of conflict resolution. The concept of Justice in
                                                                       c
mediation is advanced in the oeuvre.s of Professors Stulberg,
Love, Hyman, and Menkel-Meadow (Self-Determination
Theorists). Their definition of justice is drawn primarily from the
exercise of party self-determination. They are hopeful about the
magic that can occur when people open up honestly and                  D
empathetically about their needs and fears in uninhibited
private discussion. And, as thinkers, these jurists are optimistic
that the magnanimity of the human spirit can conquer structural
imbalances and resource constraints. Professor Stulberg, in his
masterful comment on the drafting of the Uniform Model                 E
Mediation Act, Fairness and Mediation, begins with the
understated predicate that "the meaning of fairness is riot.
exhausted by the concept of legal justice." In truth, the more
pointed argument advanced in the article is that legal norms
often diverge quite dramatically from our notion of fairness and       F
the. notion of fairness of many disputants. Legal rules, in
Stulberg's vision, are ill-equipped to do justice because of their
rigidity and inflexibility. Professors Lela Love andJonathan M.
Hyman argue that mediation is successful because it provides
a model for future collaboration. The authors state that the           G
process of mediation entails the lesson that when people are
put together in the same room and made to understand each
other's goals, they will together reach a fair resolution. They cite
Abraham Lincoln's inaugural address which proposed that in
a democracy, '"a patient confidence in the ultimate justice of         H
    778        SUPREMf: COURT REPORTS               [2014] 6 S.C.R.


A   the people' to do justice among themselves ... is a pillar of
    our social order." Professor Carrie Menke I-Meadow presents
    a related point of view in making the case that settlement has
    a political and ethical economy of its own and writes:

          "Justice, it is often claimed, emerges only when lawyers
B
          and their clients argue over its meaning, and, in turn, some
          authoritative figure or body pronounces on its meaning,
          such as in the canonical cases of the late-twentieth
          century ... For many years now, I have suggested that there
          are other components to the achievement of justice. Most
c         notably, I refer to the process by which we seek justice
          (party participation and empowerment, consensus rather
          than compromise ~r command) and the particular types of
          outcomes that might help tq achieve it (not binary win-lose
          solutions, bu·t creative, pie-expanding or even shared
D         solutions)."

        Justice in mediation also encompasses external
  developments, beliefs about human nature and legal regulation.
  Various jurists are drawn to mediation in the belief that litigation
E and adversarial warring are not the only, or the ·best ways to
  approach conflict. And how optimistically and skeptically
  mediators assess the capabilities of individual parties and
  institutional actors to construct fair outcomes from the raw
  material of human conduct.
F       Mediation ensures a just solution acceptable to all the
  parties to dispute thereby achieving 'win-win' situation. It is only
  mediation that puts the parties in control of both their disputes
  and its resolution. It is mediation through which the parties can ·
  communicate in a real sense with each other, which they have
G not been able to do since the dispute started. It is mediation
  which makes the process voluntary and does not bind the
  parties against their wish. It is mediation that saves precious
  time, energy as well as cost which can result in lesser burden -
  on exchequer when poor litigants are to be provided legal aid.
H It is mediation which focuses on long term interest and helps
VIKRAM BAKSHI & ORS. v. SONIA KHOSLA {DEAD) 779
           BY LRS. [A.K. SIKRI, J.]
                                                                   A
the parties in creating numerous options for settlement. If is
mediation that restores broken relationship and focuses on
improving the future not of dissecting past. It is based on an
alternative set of values in which formalism is replaced by
informality of procedure, fair trial procedures by direct          B
participation of parties, consistent norm enforcement by norm
creation, judicial independence by the involvement of trusted
peers, and so on. This presents an alternative conceptualization
of justice.

     19. We have purposely stated the aforesaid advantages C
of mediation process in a hope that if not now, in. near future
the parties may agree on exploiting this mechanism to their
advantage.

    20. In this backdrop, Mr. Dushyant Dave, the learned 0
Senior Counsel who appeared for Bakshi Group in SLP {C)
No. 6873 of 2010 made a fervent plea before this Court to
invoke the provisions of Article 142 of the Constitution and put
an end to the entire litigation between the parties pending in
various courts by putting the parties to such terms, which this E
court finds to be eq"uitable for both the parties. On behalf of
Bakshi Group he also gave the offer to surrender/give 50% of
land to the Khosla Group and also an amount of Rs: 6.40
Crores, He even submitted that if this Court finds the said
amount to be inadequate the Court would be empowered to
fix higher amount. However, that was not acceptable to the other F
side as accoraing to them not only they are entitled to get the
entire land which belongs to them but the amount of
compensation which Bakshi Group is liable to pay to them
would be many times more than the amount offered. Lest we
be misunderstood, we are not blaming either side. We have G
indicated this, just to give a hint of the magnitude of imbroglio
that has occurred between the parties. At the same time, as
there are many cases of different nature pending in different
courts it is not possible to exercise powers under Article 142
of the Constitution and to resolve all those cases. However, we H
    780      SUPREME COURT REPORTS                [2014] 6 S.C.R.


A feel sad about the state of affairs. The dispute which has arisen,
                                                                  1
  out of MOU/ collaboration agreement between the parties is not
  unique or unprecedented. Such type of differences do arise.
  Day in and day out there are litigations of the kind which is filed
  in the CLB by Ms. Sonia Khosla. Ho~ever, what is
B unprecedented is the monstrous proportions which this litigation
  has assumed with the multiplication of proceedings between
  the parties today which arose out of one petition bE~fore the
  CLB.
          21. In fact, though the learned Senior Counsel for the
C parties had argued the matters before us at length on the
   previous occasions, at the stage of conclusions of the
   arguments, the learned Senior Counsel Mr. Cama appearing
   for Khosla Group suggested for an early decision of the
   Company Petition before the CLB as a better alternative so that
D at least main dispute between the parties is adjudicated upon
   at an early date. He was candid in his submission that the
   issues which are subject matter of these two Special Leave
   Petitions and arise out of the proceedings in the High Court,
   have their origin in the orders dated 31.1.2008, which is an
E interim order passed by the CLB. He thus, pointed out that once
   the Company Petition itself is decided, the issues involved
   therein namely whether Board meeting dated 14.12.2007 was
   illegal or whether Board meeting dated 30.9.2006 was barred
   in law would also get decided. In the process the CLB would
F• also be in a position to decide as to whether minutes of AGM
   of the Company allegedly held on 30.9.2006 are forged or not
   and on that basis application under Section 340 Cr. PC which
   is filed before the Company Law Soared would also be taken
   care of by the CLB itself. Learned Senior Counsels appearing
G for the Bakshi Group immediately agreed with the aforesaid
   course of action suggested by Mr. Cama. We are happy that
   at least there is an agreement between both the parties on the
   procedural course of action, to give quietus to the matters
   before us as well. In view of the aforesaid consensus, about
H the course of action to be adopted in deciding the disputes
VIKRAM BAKSHI & ORS. v. SONIA KHOSLA (DEAD) 781
           BY LRS. [A.K. SIKRI, J.]
between the parties, we direct the Company Law Board to              A
decide Company Petition No. 114 of 2007 filed before it by Ms.
Sonia Khosla within a period of six months from the date of
receiving a copy of this order. Since, it is the CLB which will
be deciding the application under Section 340 Cr. PC filed by
Ms. Sonia Khosla in the CLB, High Court need not proceed              B
further with the. Criminal Misc. (Co.). No. 3 of 2008. Likewise
the question whether Mr. R.K. Garg was validly inducted as a
Director or not would be gone into by the CLB, the proceedings
in Co. Appeal No. (SB) 23 of 2009 filed by Mr. R.K. Garg in
the High Court, also become otiose.                                  c
    22. The only aspect on which some directions need to be
given are, as to what should be the interim arrangement. The
Bakshi Group wants orders dated 31.1.2008 passed by CLB
to continue the interregnum. The Khosla Group on the other
hand refers to orders dated 11.4.2008 as it is their submission      D
that this was a consent order passed by the High Court after
the orders of the CLB and, therefore, this order should govern
                     .
the field in the meantime ..
                                              '
      23. After considering the matter, we are of the opinion that
it is not necessary to either enforce orders dated 31.1.2008          E
passed by the CLB -or orders dated 11.4.2008 passed t;>y the
High Court. Fact remains that there has been a complete
deadlock, as far as affairs of the Company are concerned. The
project has not taken off. It is almost dead at present. Unless
the parties re-concile, there is no chance for a joint venture i.e, :; F
to develop the resort, as per the MOU dated 21.12.2005. It is
only after the decision of CLB, whereby the respective rights·
of the parties are crystallised, it would be possible to know.
about the future of this project. Even the Company in question
is also defunct at present as it has no other business activity G
          •
or venture. In a situation like this, we are of the opinion that
more appropriate orders would be to direct the parties to
maintain status quo in the meantime, during the pendency of
the aforesaid company petition before the CLB. HO"'{E!Ver, we
make it clear that if any exigency arises necessitating some H
                                                            '
    782        SUPREME COURT REPORTS             [2014] 6 S.C.R.


A   interim orders, it would be open to the parties to approach the
    CLB for appropriate directions.
        24. Both these petitions are disposed of in the aforesaid
  terms. All other pending I.As including criminal contempt
  petitions and petitions filed under Section 340 Cr. PC are also
B disposed of as in the facts of this case, we are not inclined to
  entertain such application. No costs.
    Devika Gujral                                Petitii:>n disposed of.