9911796707
TMI Blog2008 (6) TMI 351X X X X Extracts X X X X X X X X Extracts X X X X ..... nting interference in exercise of appellate power. X X X X Extracts X X X X X X X X Extracts X X X X ..... 250 shares in the open market through his share broker M/s. TRC Securities Pvt. Ltd. in the month of May/June, 1997. Upon lodgment of the said 250 shares with MCS Limited, they, vide their letter dated 26-6-1997 refused to transfer/register the shares in the name of the lodger i.e., Morgan Stanley Assets Management Inc., A/c Morgan Stanley Institutional Fund Inc. Emerging Markets Portfolio. Subsequently, the 250 shares were returned to first respondent as 'Bad Delivery' under two different covering letters dated 26-6-1997 and 10-7-1998 respectively. MCS Limited received a letter bearing No. 5696/Cus/Mob/UR-CBI/96 (533B) dated 29-2-1996 from the second respondent-Custodian regarding stop transfer of the shares in favour of any person without permission of the Custodian. The MCS Limited also enclosed copy of transfer deeds, share certificates and Custodian's letter dated 29-2-1996 along with their letter to the second respondent who on going through the same, came to know that 117335 shares of fourth respondent-company belonged to the Notified Persons of the group of late Harshad S. Mehta which were seized by CBI and remained in their custody. The letter also revealed that late Hars ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... through whom the first respondent purchased those shares so that through proper channel, the introducing broker as well as the shareholder, i.e., the appellant could be asked to replace the said shares with good shares. The first respondent admitted that he purchased 200 shares from the open market through their share broker and paid the consultation thereof and thereafter the shares were also registered in his name by the fourth respondent-company as per the provisions of the Companies Act, 1956 and he had absolutely no knowledge about the duplicate shares being issued in the name of the appellant by the fourth respondent-company. He claimed that in the facts and circumstances narrated in the application, first respondent is the real and only owner of these shares and, accordingly, all corporate benefits accrued thereon since the date of registration of the 250 shares in his name, be paid to him in the interest of justice. By reasons of the impugned order dated 10-10-2003, the learned Special Judge allowed Misc. Application 186 of 2000 filed by the first respondent. It was directed :-- "This application relates to 250 shares of respondent No. 3 company. It appears that the respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent No. 4 Coram D.K. Deshmukh, J. Judge, Special Court dated 14-7-2004 P.C. Matter called twice. None present for the applicant. Application rejected." 8. Again, the appellant preferred Misc. Application No. 263 of 2004 for restoration of the Review Petition, which was dismissed and the following order came to be passed on 18-8-2004 : "Even assuming that due to mistake of the lawyer, lawyer could not remain present and therefore, the review petition was rejected, after having heard the learned counsel appearing for the Applicant on the review application, I find that there is no reason to review the order dated 10-10-2003. Applicant was Respondent No. 4 in Misc. Application No. 186 of 2000. By order dated 16-7-2003, he was directed to deposit an amount of Rs. 6 lakh in the court. He did not obey that order. Therefore, the Applicant is not entitled to any indulgence from this Court. Misc. Application disposed of." 9. Hence, the appellant has assailed the above-said three orders before this Court in these appeals preferred under section 10 of the Act. 10. During the pendency of the appeals in this Court, the legal representatives of late Harshad Mehta are substituted as res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the learned Special Judge which, according to them, cannot be found faulty or invalid on any grounds whatsoever as alleged by the appellant. 14. We have given our thoughtful and anxious consideration to the respective contentions of the learned counsel for the parties and perused the material on record. The contentions of the learned counsel for the appellant at the first blush sound attractive, yet we are afraid to accept the same. 15. The undisputed facts are that the first respondent purchased 800 shares including 200 shares (the subject-matter of the proceedings) of fourth respondent-company in open market in the months of July and August, 1994 through its share broker Jamnadas Morarjee & Co., C-4 Defence Colony, New Delhi-24. The fourth respondent-company allotted 50 bonus shares to him against the said 200 shares in the ratio of 1:4. In all, the dispute before the learned Special Judge was limited to 250 shares. Late Harshad S. Mehta, who was a party - third respondent herein, is represented through his legal representatives Nos. 3(i), (ii) and (iii ) respectively. Indisputably, deceased Harshad Mehta was a notified person under sub-section (2) of section 3 of the Act and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erty. 17. In this view of the matter, learned Judge of the Special Court has rightly concluded that 200 duplicate shares were obtained by the appellant by misrepresentation. The said 200 shares plus 50 Bonus shares were attached by the CBI in proceedings initiated against deceased Harshad S. Mehta, therefore, the attached shares of the fourth respondent-company could not be transferred to any party. The record of second respondent-Custodian would reveal that 250 shares were purchased by the appellant in the month of June, 1994 and payment of Rs. 2,92,400 was made by cheque dated 6-7-1994. In these circumstances, the learned Special Judge directed the appellant to pay to the first respondent an amount of Rs. 2,92,400 with interest at the rate of 18 per cent per annum from 6-7-1994 till the date of realization. 18. In the backdrop of the facts and circumstances and in the light of the provisions of law, in our view, the orders of the learned Special Judge impugned in these appeals do not suffer from any infirmity or illegality warranting interference in exercise of appellate power. 19. For the reasons aforementioned, we do not find any merit in these appeals which are dismissed, a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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