2001 (6) TMI 819

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....ell Leathers (P.) Ltd. Versus Shoe Specialities (P.) Ltd. S. Balasubramanian, Vice-Chairman and K.K. Balu, Member For the Appellant/Petitioner/Plaintiff: Shankaranarayanan, Adv. For the Respondents/Defendant: S. Ravi and Krishna Srinivasan, Advs. ORDER Balasubramanian, Vice-Chairman 1. In this petition filed under section 111(4) of the Companies Act, 1956 ('the Act'), the....

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....he third respondent. The petitioners are challenging these transfers on two grounds. One is that when original share certificates were in the custody of Shri M.D. Chhabria, the company could not have issued duplicate certificate without following the established procedure and that transfer of the shares was not in accordance with the provisions of articles. 3. The respondents have filed a reply....

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....s which had been transferred to the third and fourth respondents. There is nothing on record to show as to why the second respondent sought for the duplicate certificates and whether the board of directors of the company had satisfied itself that either the original certificates had been lost or destroyed as provided in rule 4(3) of the Companies (Issue of Share Certificates) Rules, 1960. Therefor....

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....s that the board of directors of the company has the discretion to transfer, the shares 'to such other party to whom the board of directors may agree' would apply only after the shares had been offered at the first instance to the existing shareholders. Since in a private limited company the transfer of shares has to be in accordance with the articles as provided under section 82 of the Ac....