TaxTMI 
TaxTMI 
2026 (7) TMI 1551
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....er of the shares of Respondent No.1 to 3 in favour of Appellant No.2 to 4 to be illegal, null and void as also the transfer of immovable assets of Respondent No.1 company. 2. It was argued Respondent No.1 and 3 were shareholders and directors of appellant No.1 company and they contacted appellant nos..2 and 3 whose company i.e.. Appellant No.4 was situated adjacent to the property of appellant No.1 and offered to sell their property and also to transfer 100% of their shareholding in appellant No.1 for consideration. 3. On 12.09.2012 after accepting the said proposal of 100% shareholding and the possession of the property of appellant No.1, the appellants no.2 and 3 immediately transferred an amount of Rs. 1 crore by way of RTGS to Respondent No.1. 4. Thereafter on 20.09.2012 the Respondent No.1 to 3, the erstwhile directors of appellant No.1 company called an EOGM of the shareholders and passed resolution and appointed the appellants No.2 and 3 as directors of appellant no.1 company and also authorized the appellant No.2 and 3 to file such information with the ROC in the prescribed format. Thus on 20.09.2012 the name of appellants No.2 and 3 as directors of appellant No.1 ....
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.... and thereafter form No.32 was submitted to the Registrar of Companies and thus the names of Respondent No.1 and 3 were deleted from the records of Registrar of Companies and names of appellants Nos. 2 and 3 incorporated as new directors. Form MGT 7 was also filed with Registrar of Companies. 10. It was argued on 20.06.2014 appellants No.2 and 3 further availed loan of Rs. 5 crores from Respondent no.1 who handed over the same interest free, subject to return of original share certificate, as security. It was mutually agreed till the said loan is repaid, the appellants No.2 and 3 will not delete the names of Respondents even though the consideration for sale of shares was already paid. It is alleged later appellants No.2 and 3 repaid the interest free loan of Rs. 5 crore to Respondent No.1 and when they demanded the original shares certificate and other documents, the Respondent No.1 without any justification started demanding interest on such loan. The Whats App chat is relied upon to disclose the real intention of Respondent No.1. 11. It is argued on 31.03.2015 the appellants No.2 and 3 filed balance sheet of the financial year 2014-15 with the Registrar of Companies thereb....
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....ter March 31, 2017. This further corroborates the fact that neither legally nor in reality this property was ever transferred from Respondent Nos. 1 to 4 Company. 43. In view of the above, the Bench concludes that the immovable property of Respondent No. 1 Company passing to the Respondent No. 4 namely Ukay Metal Industries Private Limited without any transfer document, under no circumstances can be constituted as a valid transfer and, therefore is illegal, null and void. 44. The Bench notes that the Shares of Respondent No. 1 Company admittedly presently being held by the Petitioners has been sought to be transferred to Respondent No. 2 to 4 based on frivolous Balance Sheet / Annual Returns of Respondent no.1 Company. Admittedly as on 31.03.2017 the statutory filing of respondent no.1 with the ROC reflects the petitioner as 100% shareholder of the Respondent no. 1 company. All of sudden, in the statutory filing of 2017-18, the Respondent no. 2 to 4 are shown as 100% shareholder of Respondent no.1. There exists no transfer form which have been signed by the petitioner or Respondent no. 2 to 4 under Section 56 of the Companies Act, 2013 read with Rule 11 of the Com....
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....the Respondents that there is an independent transfer of Rs. 5 crores loan given by the Petitioner No. 2 to Respondent no. 2 and 3 which has been repaid on 26.09.2017. the Respondents mention that this is the reason that share transfer was not done by the Petitioners to the Respondent nos. 2 and 3. The Bench notes that there is not a single document has been produced to connect the share transfer with Rs. 5 crores loan. The loan has been given by the Petitioner no. 2 to the Respondent nos. 2 and 3 in their individual capacity and has no relationship with the transfer of Shares of the Respondent No. 1 Company. A mere oral contention by Respondent nos. 2 to 4 cannot have any bearing on the share of Respondent no.2. In any case these loans given in the personal capacity by the petitioner no.2 was repaid back fully by respondent no. 2 and 3. 13. On the issue pertaining to the alleged transfer of 100% shareholding of appellant No.1, it was argued on behalf of the respondents that the official MCA records categorically and unequivocally reflect the shareholding in the name of Respondents No.1 to 3 as on the date of filing of the petition till date. Reference was made to the certified ....
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....e Appellants misrepresented the MOU dated 21.12.2012 to project it as creating a binding and concluded contract whereby the consideration for the transfer of 100% shareholding stood finally settled at Rs. 3 Crores. Admittedly, no Share Transfer Deed [Form SH-4] was ever executed, no share certificates were endorsed or delivered, and the mandatory procedure prescribed under Section 56 of the Companies Act, 2013 was never followed. Consequently, the alleged transfer of shareholding is non-est in the eyes of law. Respondents No.1 to 3 [Mukesh Jain, Sonu Jain, and Sushil Jain] remain as 100% shareholders of Appellant No.1 Company since September 2007, and remain in possession, till date, of the original share certificates, with no endorsement of transfer thereon. 18. Now vide the MoU, Respondents No.1 to 3 discussed to transfer their 100% shareholding of Appellant No.1 Company to Appellants No.2 and 3, for a consideration that was expressly left to be finalised between the parties on a subsequent valuation. The same is unequivocally established by Clause 10 of the MoU which read as: "after receipt of Loan Amount, Second Party will pay balance total amount to First Party immediately.....
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....er of 100% shareholding of the Appellant No.1 Company. 21. Thus, the Appellants falsely projected that Appellants No. 2 and 3 paid Rs. 3 crores towards the purchase of the Respondents' shareholding. The contemporaneous financial records conclusively belie this assertion. The amount of Rs. 3 Crores was admittedly advanced only by M/s. Ukay Metal, which consistently reflected the said amount in its own books merely as a loan, and never as consideration for the purchase of shares or acquisition of immovable property, and then suddenly in the books of 2017, it was shown as "All fixed assets & other loans & advances transferred to M/s. Ukay Metal Industries Pvt. Ltd. against loan amount of Rs. 3,00,00,000/- " without there being any document executed in favor of the M/s. Ukay Metal by the Appellant Company. Moreover, the very same MGT-7/Annual Return for FY 2016- 17, filed on 22.11.2017 where the asset was shown as transferred to Ukay Metal, continues to reflect Respondent Nos.1 to 3 as 100% shareholders even as on 31.03.2017. Further, the statutory records from 2014-2017 categorically reflected respondents as the 100% shareholders of Appellant No. 1. It was only after the FIR was lo....