1994 (6) TMI 159 - Commission - Companies Law

Summary

Issues:
1. Delay in payment of redemption value for master shares.
2. Compensation for loss of investment opportunity.
3. Allegations of preferential treatment in payment.

Analysis:

Issue 1: Delay in payment of redemption value for master shares
- The complainant held a significant number of master shares and opted for redemption as per the notification by the opposite party No. 1. The redemption value was not paid within the stipulated period, causing financial loss to the complainant.
- The complainant expected to receive the redemption value by a certain date to invest in a public issue of shares, but the delay prevented them from seizing the investment opportunity.
- The Commission found the delay in payment unjustifiable and ordered the opposite party to pay the redemption value within ten days from the date of the order.

Issue 2: Compensation for loss of investment opportunity
- The complainant calculated the potential earnings from investing the redemption amount in a public issue of shares, which was significantly higher than the compensation received.
- The Commission acknowledged the financial loss suffered by the complainant due to the delay in payment and awarded additional compensation to cover the lost investment opportunity.
- The compensation amount was determined based on the detailed calculations provided by the complainant in Annexure 'A' to the petition.

Issue 3: Allegations of preferential treatment in payment
- The complainant alleged that out-of-turn payments were made to other individuals, indicating preferential treatment by the opposite parties.
- Despite the opposite parties not contesting the matter and failing to challenge the complainant's contentions, they attempted to settle the dispute at a late stage, which the complainant viewed as a delay tactic.
- The Commission, considering the conduct of the opposite parties, directed them to pay the compensation and redemption value as ordered, without awarding interest for the past period.

Conclusion:
- The Commission allowed the complaints and directed the opposite party to pay the redemption value and compensation to the complainants within a specified timeframe, addressing the financial losses incurred due to the delayed payment of redemption value for the master shares.