Fali Nariman and his son Rohinton Nariman argued on behalf of MS Reddy of the Balaji group, an associate of the Mallyas, while another team lawyers led by counsel and former Union finance minister P Chidambaram and Harish Salve, son of former Congress minister NKP Salve, representing the Chhabria faction.

The hearing, at the court of Justice HL Gokhale, started in the morning and continued till late in the day. The hearing will again resume on Friday.

Representing Reddy, Fali Nariman argued that the acquisition of Herbertsons shares by the Chhabrias, over and above the agreed holding of 26 per cent, be declared null and void. Nariman prayed that the acquisition of the additional shares be held illegal as it was in violation of the Takeover Code of 1994 and 1997.

Salve, who argued on behalf of the Chhabrias, said that the primary focus of the takeover code of the Securities & Exchange Board of India was the development of the securities markets and adequate investor protection. The current law does not frown upon takeovers, argued Salve. The hearing will continue on Friday and Chidambaram is expected to argue on behalf of Chhabrias.