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TMI Blog2017 (7) TMI 225X X X X Extracts X X X X X X X X Extracts X X X X ..... al fact since the order, if any, passed may be or may not be in consonance with the order, if any, passed by this Tribunal in this proceeding. Therefore, it is a fit case where the petitioner can approach the civil court. Further, the petitioner did not choose to implead the transferee of shares by name, Mr. Rajgopal BV, as a party to this petition. Any order of rectification of the register passed in this proceeding would have a direct effect on the interest of Mr. Rajgopal BV. Therefore, Mr. Rajgopal BV is not only a proper party, but also a necessary party to this proceeding. But, such person has not been impleaded as a party in this petition. In view of the above the petitioner is not entitled to any relief in this petition. This petition is dismissed. - CP NO. 13/58 & 59/NCLT/AHM/2016 - - - Dated:- 9-6-2017 - MR. BIKKI RAVEENDRA BABU, J. For The Petitioner : C.S. Rahul Sahasrabuddha, PCS For The Respondent :Mrs. Vaibhavi Nanavati, Ms. Prachiti Shah and Vandan Shah, Advs. FINAL ORDER 1. This petition is filed by the shareholder of M/s Symphony Limited, seeking direction/order to the company and to the Transfer Agent to issue duplicate shares in respec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r has become entitled to receive 5000 bonus equity shares of the first respondent company. However, no such bonus shares were provided to the petitioner. The petitioner by his letter dated 28.9.2016 informed respondents 1 and 2 about the non-receipt of bonus shares, for which no response was given by the respondents. On the other hand, on 5.10.2016, the first respondent company sent a letter confirming the status of the petitioner as bona fide registered shareholder of the company. But, in the same letter, the first respondent stated that respondent No.3, who was the earlier Share Transfer Agent of the first respondent company indulged in certain illegal activities by transferring and dealing in the shares of the first respondent company. It is also stated in the letter of the first respondent company that SEBI instituted suo motu proceedings against the third respondent under various provisions of the SEBI Act, 1992. The order passed by SEBI on 22nd March, 2016 clearly indicates that the third respondent deals in the shares of the first respondent company fraudulently and in bad faith. In the same letter, the first respondent company informed the petitioner that his shares were tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent company issued bonus shares in September, 2016, by which date the petitioner was not a shareholder and, therefore, bonus shares were not issued to the petitioner. The first respondent company took a plea that non- joinder of Mr. Rajgopal BV renders the petition not maintainable. It is also the plea of the first respondent that for the illegal acts, if any, committed by the third respondent, the first respondent company cannot be held vicariously liable. According to the first respondent, if at all the petitioner is able to establish that he had not entered into any transaction in respect of his shares with Mr. Rajgopal BV, the remedy for the petitioner is against the third respondent and that too in a civil proceeding, but not before this Tribunal. Further, it is stated in the reply that the petitioner already lodged a complaint with SEBI on 18.10.2016 seeking release of dividend in respect of his shareholding, but the said fact has not been disclosed by the petitioner in the petition and, thereby, the petitioner has suppressed the material facts. Respondents 4 and 5 also filed reply stating almost the same facts that were stated in the reply of the first respondent company. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any, of the transferee has been delivered to the company by the transferor or the transferee within a period of sixty days from the date of execution, along with the certificate relating to the securities, or if no such certificate is in existence, along with the letter of allotment of securities: Provided that where the instrument of transfer has been lost or the instrument of transfer has not been delivered within the prescribed period, the company may register the transfer on such terms as to indemnity as the Board may think fit. (2) Nothing in sub-section (1) shall prejudice the power of the company to register, on receipt of an intimation of transmission of any right to securities by operation of law from any person to whom such right has been transmitted. (3) Where an application is made by the transferor alone and relates to partly paid shares, the transfer shall not be registered, unless the company gives the notice of the application, in such manner as may be prescribed, to the transferee and the transferee gives no objection to the transfer within two weeks from the receipt of notice. (4) Every company shall, unless prohibited by any provision of law or any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rrendered to the company. The corresponding Section in the Old Act is 84(4). Section 84(4) of the Old Act says the same thing which the Section 46(2) of the New Act says. Rule 4 of The Companies (Issue of Share Certificate) Rules, 1960 [ the Old Rules for short] are framed in exercise of the powers conferred by clause (b) of sub-section (1) of Section 642 of the Companies Act, 1956. 9. In supersession of the said Rules from 1st April 2014, the Companies (Share Capital and Debenture) Rules, 2013 [ the New Rules for short] came into force. Rule 6 of the New Rules deals with issue of renewed or duplicate share certificate. The above said provisions of the Companies Act, 1956; the provisions of the Companies Act, 2013; Rule 4 of the Old Rules and Rule 6 of the New Rules empower only the Board of the Company to issue duplicate share certificates in case where share certificates were lost. 10. In the case on hand, the petitioner alleged that his shares were misplaced. The petitioner did not choose to state either in the petition or in the rejoinder as to when he came to know that this shares were misplaced. From the pleadings of the first respondent company, it appears that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsfer forms were placed for effecting transfer in the year 2015 before the company. Therefore, it cannot be said that without sufficient cause the name of the petitioner has been omitted from the register of members. The name of the petitioner was omitted from the register of members on a belief that the petitioner entered into a share transaction and on the basis of share transfer form produced by the Transfer Agent of the first respondent company. Therefore, it can be straightaway said that there is a title dispute between the petitioner and Mr. Rajgopal BV. It has to be determined whether the share transfer form was duly signed by the petitioner or not or whether the share transfer is a fraudulent transaction or not. Unless and until the said issue is decided, it is not possible for this Tribunal to decide the controversy. In this context, it is necessary to refer to the decisions relied upon by the learned counsel for the petitioner. In Madhava Ramachandra Kamath v. The Canara Banking Corporation reported in (1940) MLJ 721, , the petitioner, a shareholder, who was having one share, took recourse to law unjustly for filing a complaint to the District Magistrate seeking sanct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onourable High Court of Punjab Haryana held that where serious disputes were involved, the proper forum for their adjudication is the civil court. But in that case, it was held that summary remedy can be exercised depending upon the facts of the case. 18. In this context, it is necessary to refer to the legal position on the aspect when there are complicated questions of law and facts are involved, whether this Tribunal can pass orders or this Tribunal has to relegate the parties to the Civil Court. In Ammonia Supplies Corpn. (P.) Ltd. v. Modern Plastic Containers (P.) Ltd. [1994] 79 Comp. Cas. 163 , the Full Bench of the Delhi High Court held that the object of Section 155 (now Section 111) of the Companies Act, 1956 is to provide a remedy in non- controversial matters or in matters where a quick decision is necessary and can be rendered in order to obviate irreparable injury to a party. 19. The scope of Section 155 of the Companies Act came up for consideration before the Apex Court in the case of Ammonia Supplies Corpn. (P.) Ltd. v. Modern Plastic Containers (P.) Ltd. AIR 1998 SC 3153 which arose from the Judgment of the Delhi High Court Full Bench Judgment in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Companies (Amendment) Act, 1988 with effect from 31.5.1991 and it is in verbatim taken into Section 111 of sub-section (4) of the Companies Act, 1956. In fact, Section 111 is corresponding to Sections 58 and 59 of the Companies Act, 2013. 21. Now, in the case on hand, there is no specific provision in the Companies Act under which this Tribunal can give a direction to the Board of the Company to issue duplicate shares. However, when there is refusal on the part of the Board of the Company to issue duplicate shares, if after it was satisfied that the share certificates were lost or when such power was not properly exercised by the Board, it can certainly be challenged. In the case on hand, the challenge involves title of the Petitioner to the extent of 5000 Equity Shares of ₹ 2/- each of the first respondent company. 22. In the case on hand, there is a dispute whether the shares of the petitioner were, in fact, transferred by the petitioner in the year 1998 or not. On the basis of a transfer form, the shares were already transferred to Mr. Rajgopal BV. Therefore, the issue involved in this case is a disputed question of facts. Moreover, in this case, investigation ..... X X X X Extracts X X X X X X X X Extracts X X X X
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