2012 (10) TMI 875 - HC - Companies Law

Application seeking rectification of the members register - Held that - Neither in the order and nor in the statement of the counsel is there anything to show that the decree was set aside for the reason that the petitioner was not pressing his claim against the courier service, in fact this order shows that there appears to have been an out of Court settlement between the petitioner and the courier company, vehement submission of the petitioner that this decree had been set aside entitling him now to rectification in the share register for the reason that he had not received any money qua the loss of these shares is not borne out from the record. Claim of the petitioner stands satisfied.

Summary

Issues:
- Appeal against the judgment and decree of the Company Law Board (CLB) seeking rectification of the members register under Section 111-A of the Companies Act, 1956.
- Dispute over ownership of 3500 shares of Jaiprakash Associates Ltd. (JAL) lost in transit.
- Suit filed against the courier service and the company, resulting in a decree against the courier service only.
- Appellant's claim for rectification of the share register based on the loss of shares and subsequent legal proceedings.
- Settlement between the appellant and the courier service leading to the setting aside of the decree against the appellant.
- Appellant's contention that the decree being set aside entitles him to rectification of the share register.

Analysis:
1. The appellant filed an appeal against the CLB's decision dismissing the application for rectification of the members register under Section 111-A of the Companies Act, 1956. The appellant claimed ownership of 3500 shares of JAL, which were lost in transit while being delivered to the company's office. A suit was filed against the courier service and the company, resulting in a decree against the courier service only, not the company.

2. The appellant argued that since the amount equivalent to the value of the lost shares had been paid to him as per the decree against the courier service, his petition under Section 111-A should be maintainable. However, it was revealed that the decree against the appellant was set aside due to a settlement between the appellant and the courier service, not because the appellant was not pressing his claim. The settlement led to the decree against the appellant being annulled.

3. The court noted that there was no evidence to support the appellant's claim that the decree against him was set aside due to him not receiving any money for the lost shares. It was concluded that the appellant's claim had been satisfied through the settlement with the courier service. Therefore, the appeal for rectification of the share register was deemed baseless and was dismissed.

4. The judgment emphasized that the settlement between the appellant and the courier service, leading to the setting aside of the decree against the appellant, did not entitle the appellant to seek rectification of the share register. The court found no grounds for interference with the impugned judgment of the CLB, ultimately dismissing the appeal.

In conclusion, the court upheld the decision of the CLB, dismissing the appeal seeking rectification of the members register based on the loss of shares and subsequent legal proceedings, highlighting the significance of settlements and decrees in such matters.