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TMI Blog2016 (12) TMI 1835X X X X Extracts X X X X X X X X Extracts X X X X ..... e debt or extinguishment of transferability of the preference shares as a result. Appellant submits that Respondent No.2 has transferred the subject shares to Respondent No.1 in contravention of law including breach of RBI guidelines. Nothing is pointed out as to what particular contravention is committed by Respondent No.2 in transferring the shares. There is no merit in this contention accordingly. Appellant further submits that the shares of the face value of ₹ 100/ of 5,00,000 preference shares of the Appellant company have been transferred by Respondent No.2 to Respondent No.1 at a price of ₹ 5,000/ and that the value of the shares has thereby been severely undermined by Respondent No.2. The value of the shares is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e redeemable preference shares forming the subject matter of the petition in favour of Respondent No.1 and rectify its register of members accordingly. 3 Learned Counsel for the Appellant submits that the impugned order of the CLB is vitiated by an error of law. She submits that in pursuance of a scheme of compromise between the company, its members and creditors, Respondent No.2 agreed to accept the sum of ₹ 350 Lacs in lieu of the preference shares held by it. Learned Counsel submits that this amounts to redemption of the shares and conversion of the share capital into a corporate debt in the sum of the agreed amount. She submits that the only right Respondent No.1 had after such conversion was to accept the amount of ₹ 350 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to what particular contravention is committed by Respondent No.2 in transferring the shares. There is no merit in this contention accordingly. 5 Learned Counsel further submits that the shares of the face value of ₹ 100/ of 5,00,000 preference shares of the Appellant company have been transferred by Respondent No.2 to Respondent No.1 at a price of ₹ 5,000/ and that the value of the shares has thereby been severely undermined by Respondent No.2. The value of the shares is a matter between the transferor and transferee. The Company can hardly be concerned with the same. In any event, such value is not binding on the Company. There is, accordingly, no merit in this contention also. 6 The company appeal is, in the premises ..... X X X X Extracts X X X X X X X X Extracts X X X X
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