2018 (3) TMI 1070 - SCH - Companies Law

Violation of the provisions of the Companies Act, 1956 - Held that - The respondent-SEBI initiated action under Section 19 of the Securities and Exchange Board of India Act, 1992 read with Sections 11(1), 11(4), 11A and 11B thereof against Suraksha Agrotech Industries Limited for its having issued Redeemable Preference Shares in violation of the provisions of the Companies Act, 1956. Since the appellant was held to be the director of the said company at the relevant point of time an order was passed against him, in pursuance of which his bank account(s) were attached. The said order has been upheld by the Securities Appellate Tribunal, Mumbai. We find that the appellant had tendered his resignation on 10th March, 2009 which was duly accepted by the said company. The courts below erred in not accepting this position.

Summary

The Supreme Court of India in 2018 (3) TMI 1070 - SC Order, heard a case where SEBI took action against Suraksha Agrotech Industries Limited for issuing Redeemable Preference Shares in violation of the Companies Act, 1956. The appellant, a director of the company at the time, had resigned on 10th March, 2009. The court set aside the order against the appellant as his resignation was accepted by the company. The appeal was allowed.