9911796707
TMI Blog2017 (4) TMI 1419X X X X Extracts X X X X X X X X Extracts X X X X ..... rusing the annual returns based on inspection. The respondents have not been able to rebut through any documentary evidence other than claiming that since the annual returns have been regularly filed it should be imputed that the petitioner had the knowledge of the transaction of share transfer in 2003 itself and hence should have come within the prescribed period which he had failed to do. We are unable to purchase the argument of the respondents for the simple reason that in the absence of any definite date of transaction reflected even in their own record, namely the annual return or for that matter as rightly contended by the petitioner even in the pleadings, the date of knowledge becomes material for the purpose of reckoning the pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re in favour of 2nd respondent as illegal, null and void and for restoration of his shares and for consequential rectification of register of the members of the company. The Tribunal after hearing the parties and on perusal of the record came to the conclusion that transfer of shares of I st respondent/petitioner in favour of 2nd respondent as fraudulent and sham. The appellant has challenged the impugned order mainly on the ground that the finding of the Tribunal that the transfer of shares of 1 st Respondent in favour of 2nd Respondent as fraudulent is not based on record and is perverse. Learned Counsel appearing on behalf of the appellant submitted that number of evidence were brought on record, including Annual Return filed with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent No. I and recorded in the books in the ordinary course of business. Being a private limited closely held company with two shareholders, the Respondent Company, after a period of seven years of the transfer of the shares, has not preserved the said records as it was not required to under any statute to maintain the same for certain number of years. Hence, the attempt of the Petitioner to now claim rights based on the same and that too after an unexplained delay of about five years is clearly misconceived and deserves no consideration. Again in paragraph 6.28 at page 28 of the reply of the respondents as a counter to petitioner's allegations in paragraph 6.28 relating to the fraudulent and illegal transfer of shares of the petitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther than those required by law to be so preserved by it. XXX In the instant case whether the respondents have fulfilled the burden of proofin support of the entries made in the Annual Returns in relation to the transfer of shares of the petitioner to the 2nd respondent, particularly when the said entries are under challenge, we are of the view that the respondents have not, for the following reasons:- a) Prima facie, the Annual Returns on which they seek to rely, in the absence of other mandatory records to establish he transfer of 5001euity shares of the petitioner to the 2nd respondent, is in itself no conclusive about the actual date of transfer, as in the Annual Returns, despite being a column present, they have failed to giv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terior motives; d) Further there is no proof produced for the payment of consideration of the alleged ₹ 50,000/-even though it is claimed that the same had been paid in cash. However, no valid receipt has been produced obviously thereby the transfer, even if any as claimed by the respondents, being hit by Section 25 of the Contract Act particularly in the absence of any written agreement on the part of the petitioner. The onus of proving that the shares have been indeed transferred by the petitioner for valuable consideration is on the respondents. We are really appalled by the attitude of respondents in claiming that in the absence of any statutory provisions, they are no required to maintain the relevant records when the compa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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