1984 (5) TMI 228

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..... askar, appellant No. 2, holds 2,475 shares in this company. According to the respondents/plaintiffs, these shares were allotted to him during the period October 11, 1972, to March 20, 1974. Section 13 of the Foreign Exchange Regulation Act, 1947 (hereinafter to be called "the 1947 Act"), prohibits the transfer of a security (which admittedly included shares of a company) in favour of a person resident outside India without the permission of the Reserve Bank of India. This Act was repealed by section 81 of the Foreign Exchange Regulation Act, 1973 (hereinafter to be called as "the 1973 Act"). Section 19 of this Act also prohibits the transfer of a security in favour of a person resident outside India. Relying on these provisions and allegi .....

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..... standi to file this suit. They had full knowledge but took no action. The suit was belated and was barred by time. Learned single judge observed that appellant No. 2 was admittedly holding a green card since 1975 and was residing in the United States and, therefore, could not be permitted to exercise the voting rights in the company. With these findings appellant No. 2 was restrained from exercising his voting rights in person or by proxy in regard to the shares mentioned in the plaint till the disposal of the suit. Feeling aggrieved, the appellants have filed the present appeal. During the course of arguments, learned counsel for the appellants showed us a letter dated January 27, 1982, from the Joint Controller, Exchange Control Depar .....

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..... nts, dealings in foreign exchange and securities and the import and export of currency and bullion. It seeks to preserve rupee resources against foreign exchange in dollars. The Reserve Bank of India is the regulating authority. It has to grant or refuse the permission. The Reserve Bank of India having given the necessary permission there could not be any justification for granting the temporary injunction. Appellant No. 2 had been exercising his right as a voter since 1973 or 1974. His right was never challenged all these years. No irreparable injury is likely to be caused if appellant No. 2 was allowed to exercise his right as a shareholder till the disposal of the suit. Balance of convenience is definitely in his favour. In conclusion w .....

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