TMI Blog2018 (9) TMI 207X X X X Extracts X X X X X X X X Extracts X X X X ..... r the suspicious transaction which have been committed by 3rd respondent. 1st respondent should protect the shareholder and should take action against the 3rd respondent and its officials for their wrong doings due to which the 1st respondent has been put to loss. 1st respondent cannot escape the responsibility saying that the other person has done misconduct so the shareholder may suffer. Appeal is allowed - COMPANY APPEAL (AT) NO. 308 OF 2017 - - - Dated:- 24-7-2018 - Mr. A. I. S. Cheema, Member (Judicial) And Mr. Balvinder Singh, Member (Technical) For The Appellant : Mr Shyam K. Shelat, Advocate For The Respondents : Mr. Gaurav Chauhan, Advocate JUDGEMENT BALVINDER SINGH, MEMBER (TECHNICAL) 1. This appeal has been preferred by appellant under Section 421 of the Companies Act, 2013 against the impugned order dated 9th June, 2017 passed by the Hon ble National Company Law Tribunal, Ahmedabad Bench, Ahmedabad. 2. The brief facts of the case are that 1st respondent is a company registered under the Companies Act, 1956, initially, as a private limited and thereafter, converted into a public limited company. The shares of the 1st respondent are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e other person on 10. 12. 2015 and the said shares are in the list of suspicious transfers as made during the period of 3rd respondent. The appellant, to establish the suspicious transfer, have submitted a copy of letter dated 21. 6. 2016 of auditor Ernst and Young who were appointed by SEBI to conduct investigation and also submitted a copy of police complaint made by the 1st respondent against 3rd respondent that it is established that the transaction has been done by 3rd respondent fraudulently without the knowledge/confirmation/consent of the appellant. The appellant submits that he never transferred any of his shares to anybody till the date and the shares are held by him only. The appellant submits that the Respondents instead of cooperating with the appellant, who is a shareholder, created hurdles and troubles in issuance of duplicate share certificate. Being aggrieved the appellant filed a CP before the NCLT. After hearing the parties the Ld. NCLT passed the order dated 9th June, 2017, the relevant portion of which is as under : 26 . In the case on hand, there is a dispute whether the shares of the petitioner were, in fact, transferred by the petitioner i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... share certificates and further direct the 1st respondent to also allot the bonus shares, accrued dividend till date and further if any. 8. The appellant in his appeal has stated that he is the holder of 5000 equity shares of the 1st respondent company and he has not transferred/sold these shares to anyone. The appellant submits that the 1st respondent has himself admitted vide letter dated 5. 10. 2016 (Page 95) that the 3rd respondent has done some suspicious transaction and the 1st respondent as per direction of SEBI had conducted an independent audit through M/s Ernst and Young. The report of Ernst Young also states that the shares in question are amongst the suspicious transfers carried out by 3rd Respondent (Page 117- 118). 1st respondent also intimated that they have lodged FIR against the 3rd respondent and their concerned persons before the Local Police Station in Ahmedabad being FIR No. 90/2016. 9. The appellant submits the respondents have illegally transferred his shares to a third party as there is no signatures of the appellant on the Form No. SH 4(Securities Transfer Form) (Page No. 226 of Reply). The appellant further submits that no proof of delivery of share ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r is required to be quashed and set aside. 12. Reply has been filed by 1st respondent. 1st respondent submitted that they deny all the averments, allegations and submissions made in the appeal save and except those which are admitted here. 1st respondent submitted that they are relying upon facts and contentions of the reply filed before National Company Law Tribunal, Ahmedabad. 1st respondent has also relied upon the order dated 17. 8. 2017 passed by this Appellate Tribunal in Company Appeal (AT) No. 228 of 2017 Hasmukh Bachubhai Baraiya Vs Symphony Ltd Others . 13. We have heard the learned counsel for the parties and perused the entire record. 14. Learned counsel for the appellant submitted that he is a shareholder of 1st respondent and holds 5000 equity shares as 30. 6. 2015. The appellant argued that he has never transferred/sold these shares to anyone. The appellant argued when the shares were split, 1st respondent sent these shares to his address. Since he has changed his address from Anantapur to Hyderabad so these shares were not received by him and were returned back undelivered to the company. The appellant argued that the undelivered share certific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enies that it had received Undelivered share certificate of the appellant at its company address or that it was/is in the custody of the 1st respondent. The learned counsel submitted that the appellant has not disclosed that the appellant has made an online complaint to SCORES (the online complaint redressal port of SEBI. Learned counsel further argued and admitted that the 3rd respondent had indulged into certain fraudulent and illegal transactions and the shares being subject matter of this appeal are a part of such fraudulent transaction per se. Learned counsel further argued that investigation into such issues is pending both before SEBI and police authorities and any orders passed by this Hon ble Appellate Tribunal may be premature. 18. After hearing both the parties, we have come to the conclusion that the appellant is shareholder of the 1st respondent and holds 5000 equity shares as on 30. 6. 2015. On the issue that he has not transferred/sold these shares he has drawn our attention to Form No. SH-4, Securities Transfer Form at Page No. 226 of the Reply filed by the 1st respondent. On careful scrutiny of the SH-4 form, which is the prescribed form for submitting to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s suspicious as the old share transfer form on the basis of which the transfer has been done is not on record and the share certificate were handed over to unidentified person and not to the transferee. This also proves that the transfer of shares is bad. 20. Learned counsel for the 1st respondent raised the issue that Mr. Rajgopal B. V. has not been made party to the appeal therefore the appeal may be dismissed. On this issue, as per the order of the Appellate Tribunal, Mr. Rajgopal B. V. was made a party and notice was issued to him but the report received says that there is No such Person. 21. During the arguments, learned counsel appearing on behalf of the 1st respondent argued that similar issue is decided by this Appellate Tribunal vide order dated 17. 8. 2017 in Company Appeal (AT) No. 228 of 2017 filed by Mr. Hasmukh Baraiya against Symphony Limited. We have gone through the said case and judgement. The facts of the case in hand are different from the case cited by the 1st Respondent. In the cited case the party had approached the Civil Court whereas the case in hand the party has not approached the Civil Court. In the case cited by the 1st Respondent, the signatur ..... X X X X Extracts X X X X X X X X Extracts X X X X
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