TaxTMI 
TaxTMI 
TaxTMI 
2025 (9) TMI 340
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....l Chandra Paul, ii) Beni Madhab Das, iii) Niranjan Ghosh, iv) Sukumar Ray, v) Provakar Das Gupta, vi) Nilmani Sarkar and vii) Major Nityananda Ray. b) Pursuant to the above, on 21 January, 1974, the respondent no.1 namely Veteran Company Private Limited (the company) was incorporated by the above 7 ex-servicemen. At the time of incorporation, the Articles of Association of the company, inter alia, provided as follows: "Article 6 - Subject to the provisions of these Articles the shares shall be under the control of the Board who may allot or otherwise dispose of the same to such persons on such terms and conditions at such times either at par or at a premium and for such consideration as the Board thinks fit, subject to the provision that no such share of the company be allotted to any person unless he is a person, who is an ex-military/retired personnel from military service under the Ministry of Defence, Government of India." "Article 37: No transfer shall be made to a minor or person of unsound mind and to any person unless he is a person who is an Ex-Military/Retired Military personnel from Military....
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....y to the next generation or to the kith and kin of an existing director and shareholder. As such, any transfer in favour of Amal Krishna Das was illegal, null and void. e) Subsequently, in or about March 1998, 280 shares was allotted to all the shareholders except Nilmani Sarkar since on that date the said Nilmani Sarkar was not a shareholder of the company. As a consequence, no additional shares could be allotted to him. f) On 14 May, 1998, the said Provakar Das allegedly transferred his entire shareholding to the said Amal Krishna Das. The said allotment was also in contravention of the Articles of Association for similar reasons as stated above. Incidentally, the alleged transfer in favour of the said Amal Krishna Das is also the subject matter of a suit being Title Suit No.124 of 1998 pending before the Learned Civil Judge, Senior Division at Alipore. g) In or about June 1998, Beni Madhab Das submitted his resignation from the company and also transferred his shareholding to Amal Krishna Das. Subsequently in the year 2000, 600 shares of the company were allotted to Rakhal Chandra Paul and Niranjan Ghosh. In the same year, Rakhal Chandra Paul transferr....
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....angshu Ghosh and 500 shares to Sudhangshu Ghosh. k) During the pendency of the above proceedings, on 3 June 2009, Niranjan Ghosh expired. By an order dated 5 June, 2009, the Company Law Board, inter alia, directed that Sukumar Ray be appointed as a director of the company and that the company be jointly managed by Sukumar Ray, Rakhal Chandra Paul and Niranjan Ghosh. 3. By the impugned order, the Company Law Board inter-alia set aside the allotment of shares made in the year 2000 and 2006-2007 respectively and directed that the appellant nos.1, 2, 4 and 5 cease to be directors of the company with immediate effect. 4. Upon the filing of the instant appeal, by an order dated 13 July, 2009, a Co-ordinate Bench passed the following order: "....so far as holdings of the individual shareholders of the company has continued for quite sometime now, I am of the view that status quo ought to be mentioned as regards holdings of the individual shareholders as on date, and also operation of the petrol pump, which appears to be the main business of the company shall not be disturbed until further order, subject to any order passed in any other Court of competent jurisdicti....
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.... to a rank outsider have clearly acted against the interests of the company. In any event, and any such transfer is void. 9. There is also no challenge to the finding in the impugned order that "Therefore, not only their shareholding is under challenge, they have also resigned from the Board. Therefore, till such time, in either of the pending proceeding, the transfer of shares effected by them is declared as null and void, the petitioners cannot participate in the affairs of the company even though their names continue to be in the register of members". 10. In Dale and Carrington(P) Ltd And Another vs. P.K. Prathapan and Others (2005), 1 SCC 212, it has been held as follows. "Section 10-F refers to an appeal being filed on the question of law. The learned counsel for the appellant argued that the High Court could not disturb the findings of fact arrived at by the Company Law Board. It was further argued that the High Court has recorded its own finding on certain issues which the High Court could not go into and, therefore, the judgment of the High Court is liable to be set aside. We do not agree with the submission made by the learned counsel for appellants....