In the month of Februrary, 2014, the Chandigarh High Court had given its decision in a situation quite similar to the above in the case of M/S Aarlia Builders And Ors. V. M/S Sukhda Promoters Private Ltd.  the facts of the case were similar to the given situation where the defendant had tried to alter the terms of a joint agreement regarding a land dispute. Consequently, the plaintiff company demanded for a partition and a permanent as well as interim injunction according to Order 39, Rules 1 and 2 of CPC r/w Section 151 of CPC. After various denials of such an injunction by the Trial Court and the Appellate Court addressing the injunction as impugned order where the main grounds remain that the act of alteration done by the defendants (clubbing of the khewats) was legal in nature and not supposed to be contested. However, the Punjab-Haryana High Court at Chandigarh affirmed to the injunction demanded by the plaintiff.

The above-cited recent case also turned out to be over-ruling the prior existing principle relating to companies which stated as follows:

            “It is an elementary principle of the law relating to joint stock companies that the court will not interfere with the internal management of companies acting within their powers, and in fact has no jurisdiction to do so…”

However, in Nagappa v. Madras Race Club , the same issue of joint petition regarding company law had come up where the Madras High Court had pointed out that a shareholder has a right to bring an action to the Court -

(i) In respect of matters which are ultra vires the company;

(ii) Where the action of the majority if illegal;

(iii) Where a special resolution is required by the articles of the company to do a particular thing and It is done either without such resolution or the assent of the majority to such resolution is obtained by a trick; and

(iv) Where the act complained of constitutes a fraud on the minority.

even in a case of Smt. Nai Bahu v. Lala Ramnarayan & Ors , it was ruled out by the Apex Court that it is the dominant intention of the document ( the joint compromise petition) which must guide the construction of the contents. Thus, it was made clear in the case that if any of the parties commits breach of the terms of compromise, he/she will have to pay the necessary damages.