9911796707
TMI Blog1981 (7) TMI 188X X X X Extracts X X X X X X X X Extracts X X X X ..... with a consequential relief of permanent injunction restraining defendants Nos. 1 to 8 from interfering with the management of the said company. The suit was contested by defendants Nos. 1 to 8 and it was pleaded that all the plaintiffs and the defendants, who were supporting the plaintiffs, had sold their shares in the said company to them and as such they had nothing to do with the said company and it was defendants Nos. 1 to 8 alone, who were the shareholders, some of whom were the directors of the company and were managing the same. On the contest of the parties, a large number of issues were framed by the trial court and after evidence was led, the trial court came to the conclusion that all the plaintiffs and defendants supporting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... very detailed resolution was passed on 20th April, 1960, a copy of which has been placed on the record as Ex. P-15. It was clearly stated therein that all the shares of the company have been transferred to defendants Nos. 1 to 8 and that the earlier shareholders of the company have ceased to be shareholders and directors and now the management was transferred to defendants Nos. 1 to 8. The aforesaid resolution was followed by a letter dated 24th December, 1960 (Ex. DW-I/1) written by the transferors (the plaintiffs) to the Registrar of Companies, intimating that all the shares had been transferred in favour of defendants Nos. 1 to 8. The sequence of the aforesaid facts clearly goes to show that first there was a transfer of shares by the pl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the transfer in their register. It is not disputed on facts that in the present case the company accepted the transfer and registered the names of the transferees in their books. Once it is held that the sale of shares would not become void for not attaching the share certificates along with the transfer deed or if it is not signed by the transferee, then the only inference is that so far as the contract between the transferor and the transferee is concerned, the same would be binding between the parties and none of the parties would be entitled to back out of the contract. As a matter of fact, it is admitted by Mr. Kaushal that all the transferors did sign the deed, Ex. P-1, also signed the proceedings of the meeting dated 20th April, 196 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the transfer would be void or non-existent. Accordingly, I do not find any merit in the third contention either. The fourth point has already been discussed. Under the fourth point, the court below took the view that section 108 of the Companies Act, 1956, was directory and that there was substantial compliance of the same. While agreeing with that view, I have given the additional reason in the foregoing paragraph. The net result is that the plaintiffs and the defendants supporting the plaintiffs have ceased to be shareholders with effect from 6th March, 1960, when the transfer deed was executed by them in favour of defendants Nos. 1 to 8 and, therefore, no relief can be granted to them in the suit. For the reasons recorded above ..... X X X X Extracts X X X X X X X X Extracts X X X X
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