Share transfer registration requires duly stamped instruments; uncancelled adhesive stamps justify refusal despite rectification rights.

Substantial compliance with the company's prescribed transfer form was sufficient, and the board could accept a usual form; a person aggrieved by delay or refusal of registration could seek rectification under section 155 even if not yet entered in the register. However, transfer deeds bearing adhesive stamps were not "duly stamped" unless the stamps were cancelled as required by the Stamp Act, and section 108 of the Companies Act demanded a proper instrument of transfer duly stamped. On that basis, refusal to register the shares was justified and rectification of the register failed.

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Issues: (i) Whether the transfer forms used for transfer of shares substantially complied with the company's articles and whether a person aggrieved who was not yet entered as a member could apply for rectification of the share register; (ii) Whether instruments of transfer bearing adhesive stamps that had not been cancelled were not "duly stamped" for the purposes of registration under section 108 of the Companies Act, 1956.

Issue (i): Whether the transfer forms used for transfer of shares substantially complied with the company's articles and whether a person aggrieved who was not yet entered as a member could apply for rectification of the share register.

Analysis: The prescribed form in the articles was held to admit substantial compliance, and the board could approve a usual or common form. The right to seek rectification under section 155 was treated as available to a person aggrieved by default or delay in registration, notwithstanding that the person had not yet been entered in the register. The court treated section 155 as the controlling provision and held that the statutory remedy was not cut down by the appellate remedy under section 111.

Conclusion: The objection based on the form of transfer and the petitioner's locus to invoke rectification failed.

Issue (ii): Whether instruments of transfer bearing adhesive stamps that had not been cancelled were not "duly stamped" for the purposes of registration under section 108 of the Companies Act, 1956.

Analysis: The expression "duly stamped" was read by reference to section 2(11) of the Indian Stamp Act, 1899. Since section 12 of that Act required cancellation of adhesive stamps so that they could not be reused, uncancelled stamps were deemed unstamped for the statutory purpose. The court held that section 108 required delivery of a proper instrument of transfer duly stamped, and the absence of cancellation meant the transfer deeds were not duly stamped. The contrary argument that the company alone was to cancel the stamps at the time of registration was rejected.

Conclusion: The company was justified in refusing registration because the transfer deeds were not duly stamped.

Final Conclusion: The application for rectification of the share register failed, and the refusal to register the transfer was upheld.

Ratio Decidendi: For registration of a share transfer under section 108 of the Companies Act, 1956, an instrument affixed with adhesive stamps is not "duly stamped" unless the stamps have been cancelled in the manner required by section 12 of the Indian Stamp Act, 1899; a person aggrieved may seek rectification under section 155, but cannot compel registration in violation of that requirement.

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