9911796707
TMI Blog1997 (6) TMI 363X X X X Extracts X X X X X X X X Extracts X X X X ..... nt holders of the said shares of the respondent company. 2. The facts of the instant case are that appellant No. 1, Smt. Kana Sen, is the widow of the late Shri Dip Kishore Sen. The respondent company is a private company limited by shares, having its registered office at Calcutta in the State of West Bengal. The deceased, Dip Kishore Sen, was the registered member of the respondent company, the relevant particulars of which are given below : (i) Share Scrip No. 88 towards 5 fully paid-up equity shares (Nos. 46 to 50) in the name of Shri Dip Kishore Sen. (ii) Share Scrip No. 127 towards 5 fully paid-up equity shares (Nos. 573 to 577) in the name of Shri Dip Kishore Sen. (iii) Share Scrip No. 95 towards 5 fully paid-up equity sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore Sen, have been transmitted in her name and fresh certificates have been issued but some controversy has arisen as regards the transfer of shares jointly held by the late Dip Kishore Sen with Smt. Tushar Sen and Shri Debi Kishore Sen. By a further letter dated May 4, 1994, to appellant No. 1, the respondent company intimated their inability to transmit in her name the shares (bearing Scrips Nos. 95, 94 and 111) jointly standing in the names of Shri Dip Kishore Sen, Smt. Tushar Sen and Shri Debi Kishore Sen, pursuant to the restriction contained in Article 35 of the articles of association of the respondent company. Appellant No. 1 also sent demand notices to the respondent company for transmission of the said shares in her name which wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he respondent company. Learned counsel for both the sides advanced their arguments on the basis of their stand taken in the appeal, reply and the rejoinder. Citing the case in Smt Kamalabai v. Vithal Prasad Co. Pvt. Ltd. [1993] 77 Comp Cas 231 (Kar), learned counsel for the appellants has argued that on the death of a registered member (Dip Kishore Sen), his legal representatives and heirs are in effect entitled to be the shareholders, for the right has devolved on them through the death of the member whose name is still on the register of members of the respondent company. Referring to the second proviso to Section 108 of the Act, he further submitted that it enables the respondent company to register as shareholder appellant No. 1 to whom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pany which is reproduced below : In the case of the death of any shareholder the survivor or survivors where the deceased was a joint holder, and the personal representatives of the deceased shareholder, where he was a sole holder or the holder of a certificate under Act VIII of 1889, or any other similar Act for the time being in force relating to the shares of such holder shall be the only person recognised by the company as having any title to sell and transfer his shares under and in terms of the immediately succeeding article hereof, but nothing herein contained shall release the estate of deceased joint holder from any liability in respect of any shares jointly held by him. Learned counsel submitted that in view of the specifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the respondent company in June, 1993, for transmission of the shares in question and in May, 1994, the respondent company intimated their inability to transmit the shares in question. The present appeal has been filed with the Company Law Board in April, 1996. The Bombay High Court has held in Shailesh Prabhudas Mehta v. Calico Dyeing and Printing Mills Ltd. [1990] 67 Comp Cas 533 that a company does not lose its right of refusal after a period of two months from lodgment except that it may become liable for penalty for not complying with the provisions of Section 111(1) as provided in Sub-section (12) of Section 111 of the Act. Therefore, we have to extend the same logic with regard to the applicability of the time limit specified in Sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , shall apply to the company, except so far as the same are specifically excluded or special provisions made in these articles. In the absence of such provisions and as the company is a private company limited by shares, regulation 25 of Table A in Schedule I to the Companies Act, 1956, will be applicable. The said regulation 25 is reproduced hereinbelow : 25. Transmission of shares.-(1) On the death of a member, the survivor or survivors where the member was a joint holder, and his legal representatives where he was a sole holder, shall be the only persons recognised by the company as having any title to his interest in the shares. (2) Nothing in Clause (1) shall release the estate of a deceased joint holder from any liability in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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