Company Petition No. 3 of 2011. Case: Rajan Sehgal and Others Vs Reliance Capital Limited and Others. Company Law Board

Case NumberCompany Petition No. 3 of 2011
JudgesKanthi Narahari, Member (Judicial)
IssueCompanies Act, 1956 - Sections 108, 111A
Citation2012 (3) CompLJ 475 (CLB)
Judgement DateJuly 28, 2011
CourtCompany Law Board


Kanthi Narahari, Member (Judicial), (Western Bench At Mumbai)

  1. The present petition is filed under section 111A of the Companies Act, 1956, seeking directions to the respondent No. 1 and 2 to register 400 equity shares in the name of the petitioner No. 1 and rectify the register of members accordingly. Ms. Amita Desai, learned PCS appearing for the petitioners, submitted that the petitioner purchased 800 equity shares of Rs. 10 each of respondent No. 1 (Reliance Capital Limited) held by various individuals including 400 shares held by respondents No. 4, 5 and 6 through his broker, viz., petitioner No. 2 (Profin Capital Services Ltd.) from respondent No. 3 (Mr. S.D. Paul), a client of petitioner No. 2, from the stock market on 27 September, 1995. These shares along with other shares of Rs. 10 each were, however, immediately pledged with Kanpur Stock Exchange as security by the petitioner No. 1 in the course of his business as a stock and share broker. Hence, the share transfer deeds could not be executed on an immediate basis and were executed on release of the pledged shares from the Kanpur Stock Exchange which explains the share transfer forms bearing dated 18 February, 2003. The aforesaid pledged shares were released by Uttar Pradesh Stock Exchange Association Limited, Kanpur, on 1 January, 2002, in accordance with the petitioner's request letter dated 28 December, 2001, issued in favour of Uttar Pradesh Stock Exchange Association Limited, Kanpur, requesting release of the pledged shares. The petitioner No. 1 vide his letter dated 26 February, 2003 provided to respondent No. 2 the details of 900 shares containing the said 400 shares and had requested respondent No. 2 to transfer 900 shares in his name and return it to him immediately. Out of the aforesaid transfer of 900 equity shares, the transfer of 500 equity shares of Rs. 10 each was duly approved and registered by the respondent No. 2, vide its letter dated 14 March, 2003, and were delivered to the petitioner No-1 by petitioner No. 2. Further, the petitioner No. 1 has requested the respondent No. 2 to transfer the said 500 shares in his demat account. While so, the respondents refused to transfer the following 400 shares which are standing in the name of the transferors, i.e., Shri Jaswant Singh Paul, and Shri Rishi Paul 200 shares, Shri Ramul Daman Paul, 100 shares and Ms. Asha Paul 100 shares. The petitioner No. 1 was informed by the respondent No. 2 vide its four letters all dated 15 March, 2003, that the aforesaid 400 shares could not be transferred in the name of the petitioner No. 1 citing bad delivery. The respondent No. 2 raised objections citing requirement of signatures of joint holder and mismatch of signatures, etc. It is submitted that the petitioner No. 1 approached the respondents Nos. 4, 5 and 6 and asked them to make good the discrepancies raised...

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