TMI Blog2005 (4) TMI 618X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner in February, 1996. At the instance of the 3rd respondent to keep controlling interest in the company, the petitioner acquired 38740 equity shares in the company in May, 1996. He was also allotted 1000 shares in June, 1997 and thus he held 39741 equity shares in the company. Some time in November, 1997, the 3rd respondent who was physically and mentally harassing the 5th respondent, coerced the petitioner to sign blank transfer forms and also an undated letter of resignation as a director of the company. With a view to protect the interests of his daughter, the 1st petitioner signed blank transfer forms and resignation letter. However, no certificate relating to the shares was handed over as the company had not issued any share certificate. As the 3rd respondent had accepted the letter of resignation of the petitioner in May 1998, the petitioner was not receiving any notice either for Board Meeting or for general meetings. Since the petitioner apprehended that his shares might have been transferred on the basis of the blank transfer instruments, he took inspection of the records of the company in the ROC office in March, 2001 and found that in the Annual Report for the year 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9.1997. Thereafter, he gifted all his shares numbering to 39741 shares along with blank transfer forms to the 3rd respondent. At a Board Meeting held on 31.12.1997 when the 5th respondent was also present, the transfer of the above shares in the name of the 2nd respondent was approved. The petitioner also resigned as a director by an undated letter of resignation which was accepted in a Board Meeting held on 1.5.1998. The petitioner was responsible for creation of rift between the 3rd and 5th respondent which resulted in dissolution of their marriage. Pursuant to the consent terms dated 18.5.2001, the petitioner paid a permanent alimony of ₹ 2,45,150/- to the 5th respondent and also paid a sum of ₹ 80,139/- for transferring her share of 28119 shares to the 3rd respondent. She also resigned from the Board. Now the petitioner has raised this dispute about his shares only as an after thought after nearly 3 years of having gifted his shares to the 3rd respondent. Since the 5th respondent, being the daughter of the petitioner was present in the Board meeting on 31.12.1997 when the transfer of the shares to the 2nd respondent was approved, the knowledge of transfer should be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re is no delay in filing of this petition. Since the transfer of shares is without consideration, without following the provisions of Section 108 and Article 8, the transfer should be cancelled and the register of members rectified by inserting the name of the petitioner in respect of the impugned shares. 5. Shri Ajay Kumar, PCS, appearing for the respondents submitted: The petition is time barred. The transfer took place on 31.12.1997 but the petition was filed only in June 2001 after a delay of more than 3 years. From the sequence of events in this case, it is evident that to get over the financial difficulties of the company, the petitioner required the 3rd respondent to mobilize funds and as a reward for the same, he gifted the impugned shares to the 3rd respondent, by executing blank instruments of transfer. The petitioner's idea was to hand over the control of the company to the 3rd respondent as is evident from his resignation as a director and shifting the registered office of the company from his residence to the residence of the 3rd respondent. Having gifted the shares to the 3rd respondent, the petitioner has impugned the transfer belatedly on 20th June, 2001. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a gift of shares is made by a registered deed and blank transfer deeds are executed both by the transferor and the transferee, the title of the transferee would be complete. In the present case, there is nothing on record in writing by the petitioner that he was gifting the shares. From the copies of the transfer deeds enclosed with the petition, I find that there are two instruments of transfer - one relating to one share and another relating to 39740 shares. While the former has been signed only by the petitioner, the later, perhaps being related to joint holding, has been signed by the petitioner and his wife. Except for the name of the company, all other details in the instruments of transfer have been filled in by someone else. The name of the 3rd respondent does not appear in the transfer instruments at all. In the absence of any written document to evidencing gifting of the shares, if the petitioner had in his own hand written the name of the 3rd respondent as transferee in the instruments of transfer, possibly a presumption of gift could be made. Thus, when the petitioner denies that he ever made gift of the impugned shares, the stand of the 3rd respondent that the shares w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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