TaxTMI 
TaxTMI 
2018 (3) TMI 1392
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....erest of the Government Company to permit such transfer. The Company Law Board, however, rejected the contentions and directed registration as per order dated 16.09.2015. The order, to the extent relevant, reads as follows: "6. Having considered (sic) the Company Petition, reply, rejoinder and the arguments (oral and written), it is observed that the Respondent Company is a Government of West Bengal Undertaking wherein 51.01% of the total issued, subscribed and paid up share capital is held by the Government of West Bengal which correspondence to 454 equity shares of Rs. 3,500/- each. Besides, the Petitioner Company is a member of the Respondent Company being the registered shareholder of 254 equity shares of Rs. 3,500/- each. As stated in the Company Petition, on or about 02.07.2014, the Petitioner Company purchased additional 100 shares of and in the Respondent Company from one Shri Sankar Naik in physical mode and the Petitioner Company vide letter dated 02.04.2014, forwarded the original share certificates along with the transfer deeds duly signed, stamped and executed to the Respondent Company for registering the transfer of the said 100 shares in the name of the Peti....
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.... 6.1 Under the aforesaid facts and circumstances, it is undoubtedly clear that the Respondent Company received the share transfer deeds along with the original share certificates for registration of the transfer in favour of the Petitioner Company who is already the second largest shareholder in the Respondent Company. On one side, the Respondent Advocate has made the submission that on 13.03.2014, the Petitioner Company had made an application for sale of its 254 shares to the Principal Secretary of Government of West Bengal, Public Enterprises Division as well as the Managing Director of the Respondent Company, on the other side, doubt has been raised over the intention of the Petitioner Company that the purported purchase of 100 equity shares is to take over the control of the Respondent Company. Over and above, the plea has been taken by the Respondent Company Advocate that the Petitioner Company is controlled by M/s MKJ Group and the business of the Respondent Company and MKJ Group are similar, whereas the Government of West Bengal is singly owing 51.01% of the paid up capital of the Company and thereby, the MKJ Group cannot acquire the control of the Respondent Company. A....
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....Whether the Learned Company Law Board should have held that in any event the application for recording of transfer of shares made on 2nd April, 2014 was refused/rejected by the letter dated 16.06.2014 served on the respondent same day and the appeal not having been filed within 60 days from 16th June, 2014 was barred under Section 58 (4) of Companies Act, 2013. d. Whether the Learned Company Law Board should have held in view of the respondents case in their Advocates letter dated 9th June, 2014 that registration was refused on 2nd April, 2014 the appeal filed on 29th September, 2014 was beyond the time fixed under Section 58 (4) of the Companies Act, 1956 and was not entertainable? e. Whether the learned Company Law Board can direct rectification of the share register in favour of an applicant when the applicant is controlled by Company which is a competitor in similar business of the Company? f. Whether the learned Company Law Board ought to have considered that MKJ Group would have access to the appellant and its trade secrets and tenders submitted and policy decision of the petitioner and act contrary to the interest of the appellant and the public at....
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....led an application to recall the judgment. The same was dismissed by order dated 08.08.2016. The High Court took the view that the liberty granted to the appellant was to file a proper review and not to seek a fresh hearing by recalling the judgment dated 15.10.2015. To quote: "The Court: The basis of the present application appears to be an order passed by the Hon'ble Supreme Court on 4th January, 2016 preferred against the order passed by a Coordinate Bench on 15th October, 2015. It appears from the order of the Hon'ble Supreme Court that the petitioner prayed for withdrawal of the special leave petition with liberty to approach the High Court. The Hon'ble Supreme Court granted the said liberty. This application has been filed with a prayer for de novo and or fresh consideration of the order dated 15th October, 2015 on a specious plea that the coordinate bench did not consider important questions of law while dismissing the 10F appeal. The petitioner in effect seeks a review of the order passed by a Coordinate Bench. The application is also not accompanied by a memorandum of review. The application is not in form. The petitioner has also not approached the Coordinate ....
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....e or to the person giving intimation of such transmission, as the case may be, giving reasons for such refusal. (2) Without prejudice to sub-section (1), the securities or other interest of any member in a public company shall be freely transferable: Provided that any contract or arrangement between two or more persons in respect of transfer of securities shall be enforceable as a contract. (3) The transferee may appeal to the Tribunal against the refusal within a period of thirty days from the date of receipt of the notice or in case no notice has been sent by the company, within a period of sixty days from the date on which the instrument of transfer or the intimation of transmission, as the case may be, was delivered to the company. (4) If a public company without sufficient cause refuses to register the transfer of securities within a period of thirty days from the date on which the instrument of transfer or the intimation of transmission, as the case may be, is delivered to the company, the transferee may, within a period of sixty days of such refusal or where no intimation has been received from the company, within ninety days of the delive....
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....w raised specifically in the appeal and the grounds, it is apparent that the appellant had raised questions of law other than the question of law on limitation. Hence, the High Court has gone wrong in its view in the order dated 15.10.2015 that "the only question of law sought to be urged in the present appeal is as to whether the Company Law Board lacked authority in reviewing petition under Section 5 of the Companies Act, 2013 beyond the period envisaged in sub-Section 4 thereof". 15. As per order 15.09.2017, the High Court, however, declined to consider the review holding that the same was beyond the scope of review and that the same can be corrected only by a superior forum. 16. We are afraid that the stand taken by the High Court cannot be justified in the factual background we have explained and the legal position analysed above. The appellant having taken specific grounds in the appeal and having raised questions of law regarding its right to refuse registration of transfer on sufficient ground, being a statutory appeal under Section 10F of the Companies Act, 1956, the High Court should have considered the same among other questions of law. 17. Be that as it may, as....