Petition to Rectify Shareholder Listing Dismissed for Lack of Jurisdiction.

The Company Law Board dismissed the petition seeking rectification of the register of members due to wrongful shareholder listing, stating it lacked jurisdiction as the issue pertained to allotment, not transfer, falling outside the scope of relevant provisions. The petitioner was advised to pursue the matter in a civil court for resolution.

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Issues:
Rectification of register of members for wrongful shareholder listing and consideration adjustment.

Analysis:
1. The petitioner filed a petition under sections 402 and 403 of the Companies Act, 1956 seeking rectification of the register of members of the respondent company due to being wrongly shown as a shareholder. The petitioner claimed that the respondent had entered into an agreement to sell an Industrial Plot to the petitioner for a total consideration, part of which was paid as earnest money.

2. The petitioner alleged that the respondent failed to execute the sale deed as agreed, and later discovered that they were shown as a shareholder without consent. The petitioner argued that this was done to divert attention from a civil case against the respondent. The petitioner requested the removal of their name from the register of members.

3. The respondent denied the allegations and did not provide any documentation to support their position. During the hearing, the respondent's counsel stated they had no instructions from the respondent to file a sur-rejoinder or make submissions.

4. The Company Law Board analyzed the provisions of section 111A of the Companies Act, 1956, which deals with the rectification of the register of transfer for public limited companies. It was noted that the petitioner's case was about an allotment, not a transfer, and thus fell outside the scope of section 111A.

5. Section 111A(2) allows for the appeal to the Tribunal if a company refuses to register a transfer of shares, but this provision is applicable pre-registration and not to cases of allotment. Section 111A(3) pertains to post-registration cases involving violations of specific laws, not wrongful allotments.

6. The absence of a provision in section 111A similar to sub-section (4) of section 111 led the Board to conclude that it lacked jurisdiction to determine the validity of the allotment. The Board suggested that the petitioner pursue the matter in a civil court.

7. Consequently, the Company Law Board dismissed the petition, stating that as the issue related to the allotment of shares in a public limited company, it did not have jurisdiction to decide on the validity of the allotment. The petitioner was advised to address the matter in a civil court if desired.

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