In the light of Judicial pronouncement(s) discuss the following: Enforceability of Shareholders Agreement in India.

Shareholders' agreements are quite common in business. In India shareholder's agreement gained popularity and currency only lately with bloom in newer forms of business. Shareholders agreement is a contractual arrangement between the Shareholders and of a Company describing how the Company should be operated and the defining inter-se shareholders' rights and obligations. A Shareholders agreement creates personal obligation between the members signing such agreement. However, such agreement does not become a regulation of the Company in the way the provisions of Articles are. Though the international view on enforceability of shareholders' agreement are split but to a large extent courts are inclined towards favouring Shareholder's agreement as long as they are not found to be detrimental to the minority stakeholder's rights. The US Courts have largely accepted shareholder agreements. [Blount V. Taft 246 S.E. 2d 763 at 769 (1978)]. While shareholders agreements are enforceable in England regardless of whether they have been incorporated in the articles of association of the Company, in India courts have either refused to recognize clauses in shareholders' agreement or, even when consistent with company legislation, enforced such clause only if they have been incorporated in the article of association of the Company. There is a series of rulings where the courts have upheld that in case of any conflict between the Articles and Shareholder's agreement, the former will always prevail.