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2022 (12) TMI 1248 - HC - Companies LawMaintainability of suit - exclusive jurisdiction of the National Company Law Tribunal - fraudulent transactions - seeking declaration that the recordings of the names of the defendant as holders of shares of and in the defendant no. 4 respectively in the books and the register of the defendant no. 4 are illegal - decree for delivery up and cancellation of the share certificates issued in favour of the defendant - perpetual injunction restraining the defendant and each one of them by themselves or through their respective servants, agents or assigns from exercising any ownership right in respect of the said shares - perpetual injunction restraining the defendant and each one of them either by themselves or through their respective servants, agents or assigns from exercising any voting right in respect of the said shares. HELD THAT:- The plaintiff has categorically pointed out the fraudulent act of the defendants in paragraph 28 of the plaint and the said fraudulent act is not committed while initiating proceeding before the NCLT. The plaintiff has also prayed for other relief with regard to perpetual injunction relates to the title of share of the plaintiff. Section 58 and 59 of the companies Act, 2013 deals with refusal by company to transfer of shares but in this case before transfer of share it is to be declared that the recording of share in the name of the defendants have been made fraudulently. The specific case of the plaintiff is fraud and the said fraud is to be adjudicated upon adducing evidence by both the parties before the Civil Court only. Section 65 of the Insolvency and Bankruptcy Code, 2016 has no manner of application in the instant case as the challenge is against issuance of shares by the auditor of a company in derogation of his fiduciary with the company and whether the said act of the auditor is in contravention of the provisions of Company Act, 2013 is on act of fraud or not is to be decided by the Civil Court. This Court finds that NCLT is not competent to enquire into the allegation of fraud specifically when the plaintiff has prayed for declaration of recording the names of defendant no. 2 and 3 as share holders in the books and the register of defendant no. 4 fraudulently and also prayed for perpetual injunction against the defendant nos.1 to 3. Accordingly, the suit filed by the plaintiff is maintainable. Application dismissed.
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