https://www.taxtmi.com/css/info/rss_sitemap/rss_feed.css?v=1746094055 https://www.taxtmi.com Business/Tax/Law/GST/India/Taxation/Policies/Legal/Corporate Tax/Personal Tax/Vat Law/Legal Information/Tax Information/Legal Services/Tax Services Tax Management India. Com / MS Knowledge Processing Pvt. Ltd. All rights reserved. One stop solution for Direct Taxes and Indirect Taxes https://www.taxtmi.com/caselaws?id=193635 https://www.taxtmi.com/caselaws?id=193635 Share transfers cancellation request - appellant ceased to be a shareholder of the 1st respondent Company - seeking rectification of register - oppression and mismanagement - locus standi of the appellant to maintain the Company Petition - Held that:- In the instant case, the CLB in Annex. A12 order non-suited the appellant on a finding that, the transfer of shares by the appellant to the 4th respondent is legal and valid, and on such transfer the appellant ceased to be a shareholder of the 1st respondent Company, who has no locus standi to file the Company Petition. Two circumstances taken into account by the CLB for arriving at such a conclusion are that, the appellant has not denied the transfer of shares to the 4th respondent nor disputed the signatures on the share transfer forms and that, the transfer of shares held by the appellant to the 4th respondent is shown in the annual returns of the 1st respondent Company made upto on 30.9.2011. When the fact that, on incorporation of the 1st respondent Company the appellant was issued with 500 equity shares, equivalent to 50% of the issued share capital of the Company, and the further fact that he was managing the affairs of the Company as its Managing Director are not in dispute, the burden is heavily upon the respondents to prove that the appellant ceased to be a share holder of the said Company on account of the alleged transfer of his entire shareholding to the 4th respondent and vacated the office of the Director of the Company, as provided under Section 283(1)(a) of the Act. Though the respondents would contend that, the alleged share transfer was with the approval of the Board of Directors of the 1st respondent Company, none of the documents produced along with Annex. A9 counter filed before the CLB or the additional affidavit filed before this Court would indicate any such approval/sanction. In such circumstances, we find no reason to sustain the finding in Annex. A12 order of the CLB that appellant ceased to be a shareholder of the 1st respondent Company and hence he has no locus standi to file the Company Petition. The question as to the locus standi of the appellant to maintain the Company Petition requires fresh consideration with reference to the original minutes of the meetings of the Board of Directors of the 1st respondent Company and other statutory records. As the Company Law Board stands dissolved with effect from 1.6.2016, on the constitution of the National Company Law Tribunal, by virtue of the provisions under sub-section (1) of Section 466 of the Companies Act, 2013, such exercise shall be undertaken by the National Company Law Tribunal, Chennai Bench. In the result, this Company Appeal is allowed, setting aside Annex. A12 order of the Company Law Board, Chennai dismissing C.P. No. 100 of 2011 as not maintainable and consequently vacating the interim orders, if any, operating as on that date in that Company Petition, and the matter is remanded to the National Company Law Tribunal, Chennai Bench, for fresh consideration of the question of locus standi of the appellant to maintain the Company Petition, with reference to the original minutes of the meetings of the Board of Directors of the 1st respondent Company and other statutory records. Case-Laws Companies Law Fri, 17 Jun 2016 00:00:00 +0530