2010 (9) TMI 919 - Board - Companies Law

Court allows petition under Companies Act, 1956, directs respondent to rectify register of members.

Sanjay Somany (HUF) Versus Industrial Credit and Investment Corporation of India Ltd.

The court found that the point of limitation did not apply in this case as the petitioner continuously made efforts to resolve the issue. The court ... Transfer of shares - Rectification of register on - Petitioner had purchased certain shares of respondent No. 1 through ‘S’, a broker Issues Involved:1. Limitation2. Maintainability and entitlement of the reliefIssue-wise Detailed Analysis:Limitation:The petitioner communicated with the respondent regarding the status of the shares sent for transfer on 30-3-1998. The respondent replied on 10-4-1998 and further communicated on 13-5-1998, providing details of the transferees. The petitioner reported the loss of shares to the Postal Department on 20-4-1998 and lodged a police complaint on 2-6-1998. Subsequently, the petitioner filed a case before the State Commission, West Bengal, on 4-8-1998, obtaining status quo orders on 6-8-1998. The petitioner's actions indicate continuous efforts to resolve the issue, leading this Bench to conclude that the point of limitation does not apply in this case.Maintainability and Entitlement of the Relief:The petitioner purchased 4,000 shares of the respondent company through a broker and sent the share certificates along with transfer deeds on 29-12-1997. Despite repeated communications, the respondent company claimed not to have received the transfer deeds or share certificates. The petitioner took all necessary steps, including lodging a police complaint and filing a case before the State Commission, which ordered status quo on the transfer of shares.The respondent argued that the petition under section 111A of the Companies Act, 1956, is not maintainable and should be dismissed. They contended that the petitioner should have sought relief from a civil court. However, the petitioner, believing this Bench had the jurisdiction, filed the petition here. The petitioner also impleaded the transferees as parties and sent notices to them.The petitioner made out a prima facie case for interference by this Bench, demonstrating no negligence and acting in good faith. The respondents acknowledged that some shares are still in physical form, while others have been dematerialised. Given the circumstances, this Bench directed the respondent company to rectify the register of members by substituting the petitioner's name for the shares held by the respondents and issue share certificates after obtaining an indemnity bond from the petitioner. The petitioner is also entitled to any bonus shares or benefits accrued on the said shares.Conclusion:The petition is disposed of with directions to rectify the register of members and issue share certificates to the petitioner, with no order as to costs.