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2016 (12) TMI 1835 - HC - Companies LawTransfer of cumulative redeemable preference shares in favour of Respondent No.1 - rectification in register of members - HELD THAT:- There is nothing to suggest that the compromise amounts to redemption of the preference shares or conversion of the amount due thereon (or any other reduced amount) into a corporate debt. Respondent No.2, even after the sanction of the scheme, continues to be a preference shareholder with agreement to accept 70% of the face value of the redeemable preference shares over a period of 10 years without any dividend. There is no question of any redemption of shares or conversion into a corporate 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 Appellantcompany 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. Appeal dismissed.
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