Unitech Limited & Anr vs Gridhar Gopal Sharma & Anr
2012 Latest Caselaw 6319 Del

$~32
*    IN THE HIGH COURT OF DELHI AT NEW DELHI

%                        Judgment reserved on: 16.10.2012
                         Judgment delivered on: 19.10.2012

+                        CO.A(SB) 37/2010

       UNITECH LIMITED & ANR                 ..... Appellants
                       Through: Mr. Arun Kathpalia and Mr. N.
                                Raja Singh, Advocates.
                versus

       GRIDHAR GOPAL SHARMA & ANR         ..... Respondents
                   Through: Mr. Hem C.Vashist, Adv. for R-2.

       CORAM:
       HON'BLE MS. JUSTICE INDERMEET KAUR

INDERMEET KAUR, J. (Oral)

1. This appeal under Section 10-F of the Companies Act has been

filed against the order of the Company Law Board (CLB) dated

04.06.2010 wherein on an application filed by Gridhar Gopal Sharma

(hereinafter referred to as respondent No. 1) under Section 111-A of the

Companies Act, a direction had been given to M/s Unitech Limited

(hereinafter referred to as the appellant) to rectify the register of

members by substituting the name of respondent No. 1 in place of Lalit

Kumar Goyal (hereinafter referred to as respondent No. 3) qua 100

shares and to issue duplicate shares to Respondent No. 1 or in the

alternate to buy the shares from the open market and allot them to

Respondent No. 1.

2. A petition under Section 111-A (3) had been filed by respondent

No. 1 in the CLB. His contention was that he was the owner of 100

shares allotted to him by the appellant company. He had the physical

possession of the said shares bearing share certificate No. 5998 and

distinctive No. from 599701 to 599800 with folio No. 0005998. The

petitioner was receiving dividends from time to time on the aforenoted

shares. In the year 2006, the petitioner had changed his residence and

shifted to Model Town; during transit, he misplaced some important

documents including his share certificate along with share transfer

deeds. On 28.02.2006, this information was given to the appellant who

vide letter dated 23.03.2006 asked him to complete certain formalities

for issuance of duplicate shares certificate. A complaint had been lodged

in the concerned Police Station on 11.05.2006 which alongwith an

indemnity bond and affidavit dated 31.10.2006 and a demand draft of

Rs.1,000/- was sent to the appellant company along with a covering

letter dated 13.11.2006 duly acknowledged by the appellant on the same

date.

3. Vide a subsequent letter dated 18.11.2006, the appellant

company/the Share Transfer Agent (STA) wrote to respondent No. 1

informing him that his letter dated 13.11.2006 was deficient in many

respects; signatures did not tally and the same be attested by a

nationalized bank; the police complaint was unattested; the affidavit and

the indemnity bond were also incomplete; copy of his ID proof duly

attested was also required.

4. Respondent No. 1 however did not respond.

5. On 27.02.2008, the STA/appellant company wrote to respondent

No. 1 informing him that they had received transfer deeds and share

certificate for 100 equity shares from Respondent No. 3 a resident of

Rohini; his mobile number also found mention in this letter. By this

letter, the company further informed respondent No. 1 that if he had any

objection to the transfer of the said shares, the company should be

informed and a copy of the FIR regarding the loss of shares or a Court

injunction for "a stop transfer" be furnished to the company within a

period of 15 days.

6. In response to this letter dated 27.02.2008, respondent No. 1

within less than 12 days on 11.03.2008 wrote to the STA requesting

them for some time to get the desired documents. Along with this letter

dated 11.03.2008, a copy of the complaint lodged in connection with the

loss of the shares was attached and a request was made to respondent

No. 2 to stop the transfer process till 30.04.2008 in order that the

requisite documents could be furnished in this intervening period.

7. On 31.03.2008, the appellant company registered the transfer of

the aforenoted shares in favour of respondent No. 3. Legal notice dated

27.3.2008 had also been sent by respondent No. 1 to the appellant

company requesting him to stop this transfer of shares wherein he had

again appended a second set of documents in continuation of his earlier

letter dated 11.03.2008; submission of respondent No. 1 being that the

appellant company in contravention of all statutory provisions and

guidelines had wrongly registered the shares in the name of respondent

No. 3 for which the appellant company should be made liable.

8. The CLB had found favour with the arguments of respondent No.

1 and had passed the impugned order directing the appellant company to

rectify their share register and allot the 100 shares which it had

registered in the name of respondent No. 3 in favour of respondent No. 1

or in the alternate to buy the shares from the open market and allot 100

shares in favour of respondent No. 1.

9. Respondent No. 3 has supported the case of the appellant

company. His submission is that this was a bonafide transfer which has

been effected by respondent No. 1 in his favour and that is why the

share transfer deeds were duly executed by respondent No. 1; there is no

other reason as to why the transfer deeds would have been signed by the

petitioner unless and until it was for the purpose for transfer of these

shares by respondent No. 1 in favour of respondent No.3. The impugned

order calls for no interference.

10. Before this Court, respondent No. 1 has been proceeded ex-parte.

He has not chosen to address his submissions.

11. The present petition as noted supra has been filed under Section

111-A (3) of the Companies Act. Section 111(3) reads as under:-

"An appeal under sub-section (2) shall be made within two months of the receipt of the notice of such refusal or where not notice had been sent by the company within four months from the date on which the instrument of transfer, or the intimation of transmission, as the case may be was delivered to the company."

12. An appeal against the order of the company refusing to register

shares in favour of the appellant may be filed within two months of the

receipt of the notice or within four months from the date of the

instrument of transfer.

13. The uniform guidelines to be followed by the RTI and STA which

guidelines/instructions have issued pursuant to the powers conferred on

the Securities and Exchange Board of India (SEBI) under Section 11 (b)

of the SEBI Act, 1992 enjoined upon the company that where the

signatures of the transferor tallies with the records of the company, the

company/STA shall transfer the shares within 15 working days. When a

request for „stop transfer‟ is received by the company/STA from the

previous registered holder, the company/STA must first verify the

signatures of the registered holder on the stop transfer instructions with

the specimen signatures on the records of the company/STA and if the

signatures of the previous registered holder on the „stop transfer‟

instructions is in order, the company/STA must record a caution

immediately on the certificate involved. It must thereafter give notice to

the registered holder to produce the copy of the FIR/a copy of a police

complaint or an injunction order passed by a Court of competent

jurisdiction along with an affidavit affirming that the involved shares

have not been sold. It must also give notice to the last holder to

surrender the share certificates by registered A.D. letter within 21 days.

If share certificates are not surrendered despite notice, to cancel these

share transfer certificates after giving a final notice to the last holder.

These guidelines find mention at serial No. 6.1.

14. Documentary evidence filed along with the petition shows that

respondent No. 1 had first informed the company about the loss of his

shares on 28.02.2006. On a letter being received by the company on

23.03.2006, respondent No. 1 had completed formalities, the complaint

filed by him dated (11.05.2006 ) in the concerned Police Station along

with an indemnity bond dated 31.10.2006 accompanied by a draft of

Rs.1,000/- had been submitted to the appellant company on 13.11.2006.

On 27.02.2008, the petitioner was informed by the appellant company

that certain share transfer certificates along with signed transfer deeds

had been received from respondent No. 3 for the transfer of the

aforenoted 100 shares in his favour.

15. Respondent No. 1 responded immediately; on 11.03.2008, he

wrote to the company enclosing the copy of the NCR which he had

lodged on 11.05.2006 with the concerned Police Station alongwith a

request to stop the transfer process till 30.04.2008; a request was made

to defer the transfer process till 30.04.2008 as respondent No. 1 was not

in Delhi in this intervening period.

16. It is also not disputed that respondent No. 1 had already filed

these documents in the year 2006 itself with the appellant company

which included his NCR affidavit, indemnity bond as also his draft of

Rs.1,000/- seeking transfer of shares in his name. Record also shows and

it is also not disputed that the attested signatures of respondent No. 1

duly attested by Punjab National Bank had also been furnished by

respondent No.1 to the appellant company. A perusal of the share

transfer from (Annexure R3) even otherwise show that the signatures of

respondent no.1 appear as Girdhar Sharma whereas in all other

correspondences exchange between the respondent no.1 and the

company, the respondent no.1 has always signed as Girdhar Gopal

Sharma which is also his name; it is not Girdhar Sharma; Gopal has

been omitted in the share transfer from. It is this form which has been

relied upon by the company pursuant to which this hurried transfer was

made in favour of respondent no.3.

17. In this factual scenario, the CLB has correctly noted that the

appellant company appeared to be in great rush to transfer the shares in

favour of respondent No. 3; it had a caution note which it had to adhere

to in the correct spirit and as per the SEBI guidelines/Instructions. This

caution note enjoined upon the company to give notice to the registered

holder (which it had done vide its communication dated 27.02.2008)

which was duly replied to by respondent No. 1 on 11.03.2008 making a

request to defer the transfer process only up to 30.04.2008 for reasons as

explained in the said communication. Along with this letter, a second set

of documents including NCR complaint dated 11.05.2006 and all other

requisite documents were re-appended. This was in full compliance of

the requirements of 6.22 of the SEBI guidelines/ Instructions.

18. The appellant company was duty bound not to transfer these

shares once it was brought to its notice that the shares had been lost and

a proper NCR had been lodged with the police. It was incumbent upon

the company to give notice to the last holder i.e. respondent No. 3 to

surrender his share certificates within 21 days mentioning the details of

the claim made by the previous registered holder. These guidelines/

Instructions which were binding upon the company have not been

adhered to.

19. Submission of the appellant that respondent No. 1 had slept over

his right for this intervening period of two years i.e. 13.11.2006 up to

February, 2008 appears to be a mis-directed submission. The appellant

company had itself on 27.02.2008 notified respondent No.1 that the

transfer deeds for the said shares had been produced by one Lalit Kumar

Goyal for which the objections had been sought from respondent No. 1

which were duly replied on 11.03.2008 and at the cost of repetition, a

second set of documents including the NCR complaint was again filed

along with this letter. The letter of 27.02.2008 had asked for a copy of

the FIR regarding the loss of shares/injunction order for stop transfer;

the SEBI Regulations postulate that either the FIR/copy or an

acknowledged police complaint or a copy of the injunction order for

stop payment had to be furnished. The requisite document i.e. copy of

the acknowledged police complaint of 11.05.2006 was already with the

company but it was again sent on 11.03.2008 with a request to stop the

transfer up to 30.04.2008 (which was even otherwise not an

unreasonably long period) to obtain the other necessary documents to

establish the claim of the petitioner.

20. In this background, the impugned order holding that the appellant

company is at fault and guilty of a wrong transfer suffers from no

infirmity.

21. Appeal is without any merit. Dismissed.

INDERMEET KAUR, J OCTOBER 19 , 2012 A