2022 (1) TMI 268 - Tri - Companies Law

Seeking to register the transfer of shares - seeking rectification in the register of members to include the applicants herein - payment of dividends as applicable on the transferred shares to the applicants from the year 2012 till date - HELD THAT - Section 58 of the Companies Act, 2013 deals with the Refusal of Registration and appeal against the Refusal, whereas Section 59 of the Companies Act, 2013 deals with Rectification in the Register of Member. It is evident from the records that the alleged shares were purchased by the petitioner in the year 2012 itself. As per section 58(4), the application has been filed within limitation period i.e. within 60 days from the intimation from the 2nd Respondent as RTA agent of the 1st Respondent is dated 18.01.2020 and was received by the applicants on 28.01.2020, The applicants filed an appeal before the Tribunal on 12.03.2020. The applicants by the SEBI Circular bearing no. SEBI/HO/MIRSD/DOS3/CIR/P/2018/139 dated 06.11.2018 which specifically deals with transfer deeds executed prior to notification SEBI (LODR) Regulations, 2015, as per this the applicants executed the indemnity bond which is also placed on record it shows that the applicants complied with the said regulations and handed over to the 2nd respondent on 27.03.2019 in their Chennai office. However the 2nd Respondent vide letter dated 02.04.2019 intimated to the 3rd and 4th Respondents for raising any objections relating to transfer within 14 days. It does not reflect any objections in the application - it is noted that the 2nd Respondent demanded share transfer stamp worth ₹ 12,375/- for effecting the transfer which is promptly sent on 04.09.2019 by hand delivery and further informed that there is no objection. Mail communication copy has been placed on record. It is further seen from the record that the 2nd respondent vide letter dated 18.01.2020 once again rejected the share transfer stating the same reason of non-submission of PAN card copy and Signature mismatch. Considering the fact that as per the applicants, records submitted it clearly shows that they have complied with all the procedures pertaining to the share transfer and also complied with sec. 58(4) of the Companies Act 2013. Henceforth, it is evident that the 2nd Respondent is making unnecessary delays making the share transfer in spite of adequate submissions made by the applicants - application allowed.

Summary

Issues Involved:
1. Registration of share transfer
2. Rectification of register of members
3. Payment of dividends on transferred shares
4. Compliance with SEBI circular SEBI/HO/MIRSD/DOS3/CIR/P/2018/139

Detailed Analysis:

1. Registration of Share Transfer:
The applicants sought an order directing the 1st and 2nd Respondents to register the transfer of shares from the 3rd and 4th Respondents to the applicants under Folio nos. 817 and 855. The shares were purchased in 2012, and the transfer deeds were signed by the 3rd and 4th Respondents. However, the transfer was delayed due to the non-submission of PAN card copies and signature mismatches. The applicants complied with the SEBI circular dated 06.11.2018, which allows for the transfer of shares despite such issues, by providing an indemnity bond and other required documents. Despite this, the 2nd Respondent rejected the transfer multiple times citing the same reasons. The Tribunal found that the applicants had complied with all necessary procedures and ordered the 1st and 2nd Respondents to register the share transfer and issue fresh share certificates in the applicants' names.

2. Rectification of Register of Members:
The applicants requested the rectification of the register of members to include their names. The Tribunal noted that the application was filed within the limitation period under Section 58(4) of the Companies Act, 2013. The Tribunal ordered the rectification of the register of members of the 1st Respondent company by removing the names of the transferors and entering the names of the transferees.

3. Payment of Dividends on Transferred Shares:
The applicants sought the payment of dividends on the transferred shares from the year 2012 till date. The Tribunal directed the 1st Respondent to pay the applicable dividends to the applicants after complying with the SEBI notification SEBI/HO/MIRSD/DOS3/CIR/P/2018/139.

4. Compliance with SEBI Circular SEBI/HO/MIRSD/DOS3/CIR/P/2018/139:
The Tribunal emphasized the need for compliance with the SEBI circular, which provides a procedure for the registration of share transfers in cases of non-cooperation by the transferor. The circular requires the collection of additional documents from the transferee, publication of an advertisement seeking objections, and a lock-in period for the transferred shares. The Tribunal ordered the 1st and 2nd Respondents to adhere to this procedure and complete the share transfer process.

Conclusion:
The Tribunal allowed the company application, directing the 1st and 2nd Respondents to register the share transfer, rectify the register of members, and pay dividends to the applicants. The Tribunal also mandated compliance with the SEBI circular to ensure the proper transfer of shares.