Government power to block share transfers where control shift is prejudicial, mandating retransfers and enforceable refunds. Where a share transfer is likely to change control and prejudicially affect the company or public interest, the Central Government may direct the company not to give effect to the transfer and to suspend voting or other rights of transferees or relevant nominees; the shares then stand retransferred to the seller and the transferee's purchase money must be refunded by that seller, with the Central Government empowered to order and enforce the refund as a civil-decree if not paid within thirty days, and the retransferee regains voting rights upon refund.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Government power to block share transfers where control shift is prejudicial, mandating retransfers and enforceable refunds.
Where a share transfer is likely to change control and prejudicially affect the company or public interest, the Central Government may direct the company not to give effect to the transfer and to suspend voting or other rights of transferees or relevant nominees; the shares then stand retransferred to the seller and the transferee's purchase money must be refunded by that seller, with the Central Government empowered to order and enforce the refund as a civil-decree if not paid within thirty days, and the retransferee regains voting rights upon refund.
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