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Issues Involved:
1. Jurisdiction and Scope of Proceedings u/s 155 of the Companies Act, 1956. 2. Validity of the Transfer of Shares. 3. Compliance with Section 108 of the Companies Act, 1956. 4. Allegations of Manipulation and Fraud. 5. Procedural and Evidentiary Matters. Summary: 1. Jurisdiction and Scope of Proceedings u/s 155 of the Companies Act, 1956: The court addressed the contention that proceedings u/s 155 are summary and discretionary. It was held that the jurisdiction conferred by section 155(3) is comprehensive, enabling the court to examine all questions relating to the title to shares, including complex and intricate issues. The court referred to various precedents, including *Public Passenger Service Ltd. v. M.K. Khadar* and *Shri Gulabrai Kalidas Naik v. Laxmidas Lallubhai Patel of Baroda*, to affirm that the company court can decide complicated questions of law and fact under section 155. The court rejected the plea that it should not exercise its discretion in favor of the petitioner merely because the matter involved complex issues. 2. Validity of the Transfer of Shares: The petitioner claimed that she never transferred her 775 shares to the third respondent and that no board meeting was held to approve such a transfer. The court found that the respondents failed to produce the share transfer form and share certificates. The evidence suggested that the resolution purportedly approving the transfer was manipulated, with visible erasures and additions. The court concluded that the respondents did not establish that the petitioner transferred her shares, and the alleged transfer was not valid. 3. Compliance with Section 108 of the Companies Act, 1956: The court emphasized that the provisions of section 108 are mandatory. The Supreme Court in *Mannalal Khetan v. Kedar Nath Khetan* held that a company cannot register a transfer of shares unless a proper instrument of transfer duly stamped and executed is delivered to the company. The respondents failed to prove compliance with section 108, rendering the alleged transfer invalid. 4. Allegations of Manipulation and Fraud: The petitioner alleged that the respondents manipulated the company records to exclude her from the company's affairs. The court found evidence of manipulation in the minutes of the board meeting, particularly in exhibit R-20, where the resolution regarding the transfer of shares appeared to be introduced subsequently. The court noted that the second respondent, who could have provided crucial testimony, did not testify, which further weakened the respondents' case. 5. Procedural and Evidentiary Matters: The court noted that the respondents did not file an additional counter to controvert the allegations in the petition. The third respondent's testimony was found lacking in credibility, particularly regarding the consideration for the alleged transfer. The court also dismissed the argument that the petitioner's delay in filing the petition should bar relief, as this contention was not raised in the pleadings. Conclusion: The court ordered the rectification of the register of members of the first respondent company by deleting the name of the third respondent with regard to 775 shares and entering the petitioner's name in place of the third respondent. The court directed the first respondent company to issue notice of rectification to the Registrar within 30 days. There was no order as to costs, considering the near relationship of the parties.
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