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2015 (4) TMI 640 - Board - Companies LawRejection to Registration / Transfer of Preference shares - Rectification in member's shares register - Period of limitation - Not sufficient cause for rejection - Held that:- It is a settled law that, if no limitation period is prescribed, in that case Article 137 of the Limitation Act shall be applicable. Therefore, in terms of Article 137 of the Limitation Act, 3 years period with effect from the date of cause of action would be available for an aggrieved party to approach the CLB for relief under Section 111/111A of the Act. In light of the above law, I have examined the pleadings as contained in the petition. On perusal of the pleadings, it is noted that the cause of action to file the instant Company Petition had arisen lastly on 3/10/2012 and the petition came to be filed in the year 2013 which is within the prescribed period of 3 years. I, therefore, hold that this petition is not barred by law of limitation and the preliminary objection is devoid of substance. It is rejected accordingly. I have considered the rival submissions. In my opinion, the aforesaid ground taken by the Answering Respondents for rejection of transfer of shares-in-question is hardly acceptable. There is no challenge that the Respondent No.2 Bank has transferred the shares in favour of the Petitioner for a monetary consideration in accordance with the law. Therefore, the Petitioner as a Transferee has stepped in the shoes of the Transferor i.e. ICICI Bank, As is seen from the scheme of amalgamation sanctioned by the Hon'ble High Court, no restriction was imposed with respect to the transfer of shares in question. In such a situation, there was no need to seek any approval from the Hon'ble High Court, who sanctioned the scheme of Amalgamation. It is a fundamental law that the transferability of shares is subject to the provisions of the Companies Act and no restriction, save and except as provided in law, can be imposed, I do not find any restriction in the transfer of shares, as sought to be contended by the Answering Respondents. Therefore, the ground taken by the Answering Respondents is frivolous, malafide, arbitrary and against the basic principles of law and, hence, liable to be rejected. On a careful perusal of the Board Resolution authorizing to sign the Transfer Deeds with respect to transfer of the shares, I do not find any illegality therein. The transfer of the shares are absolutely valid. There is no forgery, fraud, manipulation and misrepresentation. The Respondent Company cannot challenge the transfer on behalf of the Transferor ICICI Bank. No restrictions can be imposed regarding the marketability of the shares, save and except provided in law. I do not find force in the contention of the Answering Respondents' Counsel that the Bank was not entitled to transfer the shares. The alleged inadequacy of monetary consideration with respect to the transfer of shares, as alleged by the Respondents, cannot be taken as a ground for rejection for registration/transfer of shares by the Company, if, the Transferor has no objection in this regard. I therefore, reject this contention too. Based on the above discussion I have come to the conclusion that the grounds stated by the Ld. Sr. Counsel for the Answering Respondents for rejection of registration/transfer of shares-in-question are unsustainable. It has been established that the Company has rejected the prayer for transfer of shares without any sufficient cause. - Decided in favour of appellant.
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