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2020 (7) TMI 560 - Tri - Companies LawRectification of the register of members of the respondent-company - Restraint on respondent-company from holding the annual general meeting or extra-ordinary general meeting - section 59(1) of the Companies Act, 2013 - HELD THAT:- The respondent-company in the instant application will fall under the category of "unpaid seller" who can exercise the above rights only. Nothing more - It is settled law as decided by the hon'ble Supreme Court of India in its judgment in TRIVENI SHANKAR SAXENA VERSUS STATE OF U.P. AND OTHERS [1991 (12) TMI 285 - SUPREME COURT] that a lien is only a right to retain which is rightfully and continuously in possession belonging to another until the claims are satisfied. It can be acquired either by contract or by operation of law. It is the right of retention of goods. In the absence of delineated process to exercise paramount lien, the respondent-company can exercise lien to the extent of retention of goods ; in this case shares which can be extendable payable to the shareholder - In the instant application, the respondent auctioned the shares without the consent of shareholders and without the original share certificate and transfer form in their possession. The earlier action appears to be illegal and not as per the Companies Act, 2013. As such the answer to the third point is also negative The company has no right to auction and allot the shares to third parties ignoring the right of fully paid-up shareholders. The rental dues claimed by the respondent-company are not supported by a rental/ lease agreement which is agreed by the shareholder - the applicants are declared as the legitimate equity shareholders under Folio No. 50. It is hereby directed that the rectification of the register of members of the respondent-company by re-entering the total number of 100 equity shares belonging to the late husband of the first applicant and late father of the second applicant and third applicant in the share register of the company and further ordering to restore the total shareholding of the applicants as it existed prior to February 8, 2019 forthwith.
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