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2022 (5) TMI 718 - Tri - Companies LawIllegal transfer of shares - consideration for transfer of shares in the name of petitioner or not - questions with regard to genuineness of the documents can be decided by this Tribunal or not? - HELD THAT - There is an admission on the part of the Respondents that the Petitioner has paid an amount of Rs. 10 Lakhs as part consideration for 40% shares, the total consideration being Rs. 20 Lakhs. The contention of the Respondents is that the Petitioner promised to pay the same later, but however the Respondents would handover blank transfer deeds as an assurance for transferring 40% shares and submitted that the Respondents handed over the original share certificates on payment of the balance consideration. Believing the Petitioner, blindly they handed over the blank transfer deeds as early as 2011, though share certificates were not handed over - Even according to the Petitioner, he was managing the affairs of the Company, hence the contention of the Respondents that letterheads containing the signature of Respondent No. 2 were given to the Petitioner in order to facilitate the smooth functioning of the Company cannot be dismissed. Jurisdiction of this Tribunal to decide the issues of fraud - HELD THAT - Admittedly in this case, the Petitioner does not have Share Certificates. As to why he did not insist for issuance of share certificates is not explained. However, from the admission made by the Respondents, it is clear that Rs. 10,00,000/- was given by the Petitioner. But the contention is that the Petitioner promised to give the remaining amount of Rs. 10,00,000/- later and did not want to take their share certificate till then. All these are highly disputed questions of fact, which cannot be adjudicated by this Tribunal. Hence, this point is answered holding that the Petitioner, as admitted by Respondents No. 1 to 3 has given Rs. 10,00,000/- which can be recovered by filing an appropriate application before appropriate forum. Admittedly, the Share Certificates are in possession of Respondent No. 4. Hence, unless evidence is taken with regard to the contentions raised by either side, no finding can be given with regard to the rights of the Petitioner. As regards the Share Transfer Form which is submitted on 11.06.2014, the Counsel for the Respondent contends that according to General Circular No. 19/2014, issued by the Government of India, Ministry of Corporate Affairs, the Share Transfer Forms executed before 01.04.2014 even if it is in as per Form-7B are decided to be accepted and thereafter it should be in Form SH-4. The Counsel submits that the Share Transfer Form filed by the Petitioner is Form-7B, which is valid only up to 01.04.2014. No counter argument, is presented on the said aspect - This Tribunal does not have jurisdiction to decide the questions raised in this Petition Petition dismissed.
Issues Involved:
1. Whether the Petitioner has given consideration for transfer of shares into his name. 2. Whether the questions raised by the parties with regard to genuineness of the documents can be decided by this Tribunal and whether the reliefs sought for can be granted. 3. To what result. Issue-wise Detailed Analysis: I. Whether the Petitioner has given consideration for transfer of shares into his name. The Petitioner claims to have paid Rs. 15,44,000/- to Respondent No. 2 for shares, loans, and other counts, and asserts that Respondent No. 2 acknowledged this payment in a letter dated 10.06.2014. The Respondents admit that the Petitioner paid Rs. 10,00,000/- as part consideration for 40% shares, but dispute the authenticity of the letter, alleging it was fabricated using blank letterheads signed by Respondent No. 2. The Tribunal notes that the Petitioner was managing the company's affairs and acknowledges the possibility that the letterheads were given to facilitate operations. However, the Tribunal concludes that determining the authenticity of the letter requires evidence, which falls outside its jurisdiction. II. Whether the questions raised by the parties with regard to genuineness of the documents can be decided by this Tribunal and whether the reliefs sought for can be granted. The Tribunal examines whether it has the jurisdiction to adjudicate the disputes involving allegations of fraud, forgery, and misrepresentation. Citing relevant case law, including judgments from the Supreme Court and the Company Law Board, the Tribunal highlights that such disputes involving highly contested facts are not suitable for summary jurisdiction and should be addressed by a Civil Court. The Tribunal refers to the Supreme Court judgment in *Aruna Oswal vs. Pankaj Oswal & Ors.*, emphasizing that issues of right, title, and interest in securities should be resolved by a Civil Court to avoid jeopardizing parties' rights. It also cites the *Tarsen Kansil vs. Dev Spinners Ltd.* case, where the Supreme Court directed the parties to approach the Civil Court for adjudication of similar disputes. III. To what result. Based on the findings under the first two points, the Tribunal concludes that it lacks the jurisdiction to decide the questions raised in the Petition. It dismisses the Petition, noting that the Petitioner can recover the admitted amount of Rs. 10,00,000/- by filing an appropriate application before the appropriate forum. The Tribunal emphasizes that the highly disputed questions of fact regarding the share transfer and the authenticity of the documents require a detailed examination of evidence, which is beyond its purview. Conclusion: The Tribunal dismisses the Petition, stating that the issues raised involve highly disputed questions of fact that require adjudication by a Civil Court. The Petitioner is advised to seek relief through appropriate legal channels for the recovery of the admitted amount and resolution of the disputed share transfer.
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