Court orders transfer of shares, rejects objections. Company directed to rectify Register of Members.

The court rejected the respondents' objections regarding the transfer of shares, finding them unsustainable. It directed the respondent company to transfer 5,00,000 Cumulative Redeemable Preference Shares to the petitioner and rectify its Register of Members accordingly. The petition was allowed with no order as to costs.

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Issues Involved:
1. Limitation and preliminary objections.
2. Complicated question of title of shares.
3. Validity of share transfer and compliance with RBI guidelines.
4. Authority to sign transfer deeds.
5. Alleged violation of the scheme of arrangement.
6. Payment of stamp duty on share transfer.

Detailed Analysis:

1. Limitation and Preliminary Objections:
The respondents argued that the petition was time-barred and should be dismissed on the grounds of limitation. They also contended that the dispute involved complicated questions of title, unsuitable for summary proceedings. The court held that the petition was filed within the three-year limitation period prescribed under Article 137 of the Limitation Act, as the cause of action arose on 3/10/2012 and the petition was filed in 2013. Therefore, the preliminary objection on limitation was rejected. The court also found no complicated question of title that could not be decided summarily, thus rejecting this preliminary objection as well.

2. Complicated Question of Title of Shares:
The respondents claimed that the transfer of shares was unlawful due to the shares being part of a scheme under Sections 391/394 of the Companies Act, approved by the High Court of Bombay. They argued that the transfer violated RBI guidelines and lacked proper authorization from the seller's Board of Directors. The court found no complicated question of fact or law and held that the petition could be decided summarily.

3. Validity of Share Transfer and Compliance with RBI Guidelines:
The respondents argued that the transfer of shares was unauthorized and violated RBI guidelines. The court noted that the transfer was done for monetary consideration and was in accordance with the law. It found no restriction in the scheme of amalgamation that prevented the transfer of shares. The court held that the transferability of shares is subject to the Companies Act, and no additional restrictions could be imposed. Therefore, the respondents' objections were deemed frivolous and against the basic principles of law.

4. Authority to Sign Transfer Deeds:
The respondents contended that the individuals who signed the transfer deeds lacked the authority to do so. They argued that the delegation of power was ultra vires as it was done by individuals who had resigned by the time of the transfer. The court found that the transfer deeds were signed by duly authorized signatories and that the transfer was valid. It rejected the respondents' claims of forgery, fraud, and manipulation, stating that the company could not challenge the transfer on behalf of the transferor, ICICI Bank.

5. Alleged Violation of the Scheme of Arrangement:
The respondents argued that the transfer violated the scheme of arrangement sanctioned by the High Court of Bombay. They claimed that the shares were converted into a debt and could not be transferred without court approval. The court found no restrictive conditions in the scheme that prevented the transfer of shares. It held that the respondents' interpretation of the scheme was erroneous and that the transfer was valid.

6. Payment of Stamp Duty on Share Transfer:
The respondents challenged the transfer on the grounds of inadequate stamp duty payment. The court found that the requisite stamp duty had been paid and rejected this objection.

Conclusion:
The court concluded that the respondents' grounds for rejecting the transfer of shares were unsustainable. It directed the respondent company to transfer the 5,00,000 Cumulative Redeemable Preference Shares to the petitioner and rectify its Register of Members accordingly. The petition was allowed, with no order as to costs.

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