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of <h1>Appeal allowed, trial court judgment set aside, appellant to return transfer deeds.</h1> <h3>Nuddea Tea Co. Ltd. Versus Asok Kumar Saha</h3> Nuddea Tea Co. Ltd. Versus Asok Kumar Saha - [1988] 64 COMP. CAS. 775 (CAL.) Issues Involved:1. Rectification of the share register u/s 155 of the Companies Act, 1956.2. Compliance with Section 108 of the Companies Act, 1956, and Section 12 of the Indian Stamp Act, 1899.3. Requirement of succession certificate, probate, or estate duty clearance for the transmission of shares.Summary:1. Rectification of the Share Register u/s 155 of the Companies Act, 1956:The respondent, Asok Kumar Saha, purchased 100 fully paid-up equity shares of the appellant, Nuddea Tea Co. Ltd., and sought rectification of the share register. The court of the first instance allowed the application for rectification. The company refused to register the transmission of shares without estate duty clearance, succession certificate, or probate, leading the respondent to file an application u/s 155 of the Companies Act, 1956.2. Compliance with Section 108 of the Companies Act, 1956, and Section 12 of the Indian Stamp Act, 1899:The appellant argued that the transfer deeds submitted by the respondent were not duly stamped as required by Section 108 of the Companies Act, 1956. The adhesive stamps on the transfer deeds were not canceled as mandated by Section 12 of the Indian Stamp Act, 1899. The court emphasized that under Section 108, a company 'shall not register' a transfer of shares unless a proper instrument of transfer duly stamped and executed is delivered. The Supreme Court in Mannalal Khetan v. Kedar Nath Khetan [1977] affirmed the mandatory nature of Section 108. The court held that the non-cancellation of stamps rendered the instrument unstamped, making it unlawful for the company to register the transfer.3. Requirement of Succession Certificate, Probate, or Estate Duty Clearance:The company initially demanded an estate duty clearance certificate, which the respondent argued was unnecessary. Subsequently, the company insisted on a succession certificate or probate under Article 44 of its Articles of Association and Sections 370 and 372 of the Indian Succession Act, 1925. The court noted that while paying dividends to surviving joint holders, the company did not insist on such certificates, indicating a possible mala fide act. However, the court refrained from expressing a view on the necessity of the succession certificate, leaving it to the company's discretion.Conclusion:The appeal was allowed, and the judgment and order of the trial court were set aside. The appellant was directed to return the transfer deeds to the respondent, who was given the liberty to file fresh transfer deeds in accordance with the law. There was no order as to costs.
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