TaxTMI 
TaxTMI 
2017 (7) TMI 625
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....vate limited company and, thereafter, converted into a public limited company. The registered office of the first respondent company is situated at Symphony House, Bodakdev, Ahmedabad, Gujarat. The second respondent is the Share Transfer Agent of the first respondent company with effect from 22nd June, 2016. The third respondent was the Share Transfer Agent of the first respondent company from 1st March, 2010 to 11th June, 2016. The fourth respondent is the Manager of the third respondent. The fifth respondent is the present Company Secretary of the first respondent company whereas the sixth respondent was the Company Secretary of the first respondent company during the period from 1.11.2015 to 17.5.2016. 4. The petitioner was originally holding 1200 equity shares of Rs. 10/- each of the first respondent company. Later on, the shares were sub-divided by dividing one equity share of Rs. 10/- each to 5 equity shares of Rs. 2/- each, as per the Board resolution dated 29.07.2011 and, thereby, the shareholding of the petitioner, as per the Register of Members of the first respondent company, as on 30th June, 2015, was 6000 equity shares. 5. According to the petitioner, his shares ....
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....st respondent company due to change of address of the petitioner. According to the petitioner, the fifth respondent Company Secretary, instead of co-operating with the petitioner, is creating hurdles in issuance of duplicate shares to the petitioner. The petitioner submitted that the company is expected to verify whether the signature of the petitioner is there on the transfer form or not. The fifth respondent Company Secretary did not look into the matter and did not perform his duty. According to the petitioner, all the respondents are hand in glove with each other and caused loss to the petitioner. The petitioner's say is that his shares in the first respondent company were fraudulently transferred. The petitioner is unable to get suitable reply from respondents nos. 1, 2, 5 and 6. As per the say of the petitioner, the first respondent is liable for the acts of its agents, more particularly, the acts of the third respondent. 7. The first respondent company stated in the reply that the claim of the petitioner for issuance of duplicate shares is based on his letter dated 4.12.2016, addressed to the second respondent on the ground that his shares were misplaced in transit. T....
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....pany for issuance of duplicate shares. In these circumstances, according to the first respondent, it is not possible for the first respondent company to issue duplicate shares to the petitioner till the petitioner gets a declaration about his ownership on the subject shares. The first respondent stated that although the petitioner by his communication dated 4.12.2016 informed about the change of his address, at the relevant point of time, he did not inform about the change of address. 10. It is the plea of the first respondent company that complicated and disputed questions of fact are involved in this case and, there is dispute regarding the ownership of the shares and, therefore, the same cannot be adjudicated by this Tribunal in a summary manner under Sections 58 and 59 of the Companies Act, 2013 read with Rule 70 of the NCLT Rules. Moreover, SEBI initiated suo motu proceedings against the third respondent and are pending. SEBI directed a special audit of the records and systems of the third respondent with respect to dividends paid. Accordingly, the first respondent company appointed M/s Ernst & Young, Auditors, to conduct special audit of the transactions handled by the thi....
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....ot be issued to the petitioner. According to the fifth respondent, the petitioner had approached the online Complaint Redressal Portal of SEBI seeking release of dividend in respect of the shareholding of the petitioner, but the petitioner suppressed this material fact and approached this Tribunal. 12. This is a petition filed under Sections 58 and 59 of the Companies Act, 2013 and Rule 70 of the National Company Law Tribunal Rules. But the relief sought in the petition relates to issuance of duplicate shares. Section 56 of the Companies Act, 2013, which came into force with effect from 1.4.2015, reads as under :- "56.Transfer and transmission of securities.- (1) A company shall not register a transfer of securities of the company, or the interest of a member in the company in the case of a company having no share capital, other than the transfer between persons both of whose names are entered as holders of beneficial interest in the records of a depository, unless a proper instrument of transfer, in such form as may be prescribed, duly stamped, dated and executed by or on behalf of the transferor and the transferee and specifying the name, address and occupati....
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....reof, be valid as if he had been the holder at the time of the execution of the instrument of transfer. (6) Where any default is made in complying with the provisions of sub-sections (1) to (5), the company shall be punishable with fine which shall not be less than twenty-five thousand rupees but which may extend to five lakh rupees and every officer of the company who is in default shall be punishable with fine which shall not be less than ten thousand rupees but which may extend to one lakh rupees. (7) Without prejudice to any liability under the Depositories Act, 1996 (22 of 1996), where any depositor or depository participant, with an intention to defraud a person, has transferred shares, it shall be liable under section 447." Reading of the abovesaid Section 56 discloses that where the instrument of transfer has been lost, the power to issue duplicate shares lies with the Board of the Company. There is nothing in Section 56 which indicate that this Tribunal can give a direction to the Company to issue duplicate shares. Section 46(2) of the Act says, that, "A duplicate certificate of shares may be issued, if such certificate is proved to have been lost or d....
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....the Act, it is necessary to find out whether the petitioner is entitled to the relief under Section 59. Section 59 of the Act deals with the rectification of register of members, if the name of any person, without sufficient cause, entered into the register of members of a company or, without sufficient cause, omitted the name of a member from the register of members or in case where a default was made or unnecessary delay was made in making entry in the register of members. 17. It is contended by the learned counsel for the petitioner that transferring of shares of the petitioner to the name of Mr. G.K. Dhariwal amounts to deleting or omitting the name of the petitioner from the register of members without sufficient cause. 18. The crucial question is whether the transfer of shares of the petitioner to Mr. G.K. Dhariwal amounts to transfer without sufficient cause or not. 19. There is no dispute about the proposition of law that shares cannot be transferred from one person to another person without producing a duly signed transfer form accompanied by original share certificate. In the case on hand, the first respondent company effected the transfer of shares of the petiti....
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....sion of his name from the register of members within the meaning of the Section. In that decision, the argument of the learned counsel for the company that the transferee was not added as a party did not find favour with the Hon'ble High Court on the ground that the share of the petitioner had not been transferred to any person validly and, therefore, the petitioner was still the holder of the share. In that case, it was held that the share of the petitioner was not validly transferred on the basis of interpretation that forfeiting the shares of an expelled member was not valid. In the case on hand, the shares of the petitioner were transferred to Mr. G.K. Dhariwal on the basis of a share transfer form, which may be genuine or may not genuine. Therefore, the said decision is not applicable to the facts of the present case. 20. Learned counsel for the petitioner relied upon the decision in Mannalal Khetan v. Kedar Nath Khetan 1976-(CC2)-GJX-0067-SC. In that case, shares were transferred without proper instrument of transfer. In the case on hand, the shares were transferred on a proper instrument of transfer, but the question whether the petitioner, in fact, transferred the....
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....ion within its field there could be no doubt the Court as referred under section 155 read with section 2(11) and section 10, it is the Company Court alone which has exclusive jurisdiction." In Para 31, the following observations are also made; "So whenever a question is raised Court has to adjudicate on the facts and circumstances of each case. If it truly is rectification all matter raised in that connection should be decided by the Court under section 155 and if it finds adjudication of any matter not falling under it, it may direct a party to get his right adjudicated by Civil Court." Thereafter, the Hon'ble Apex Court has observed as under; "We have already held above the jurisdiction of the Court under section 155, to the extent it has exclusive jurisdiction of Civil Court is impliedly barred. For what is not covered as aforesaid the Civil Court would have jurisdiction." Therefore, it is clear from the Judgment of the Hon'ble Apex Court in Ammonia Supplies Corpn. (P.) Ltd. (supra) that, insofar as matters of rectification are concerned, it is the Company Court only has jurisdiction. If issues which have to be answered are not peripheral to recti....