TMI Blog2008 (4) TMI 827X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent from using the name Mansani in all his personal ventures that may be undertaken in the real estate sector; d) to direct the second respondent to produce the Company's books of account, records and other vouchers kept in his custody; e) to maintain shareholding pattern till disposal of the company petition; f) not to sell or dispose of any immovable property belonging to the Company as well as the fourth respondent, a proprietary concern owned and operated by the second respondent; and g) to direct the fourth respondent to furnish details of income and expenditure on periodical basis. 2. Shri V.S. Raju, learned Counsel has challenged the very maintainability of the company petition on the premise that the petitioner is never a shareholder of the Company and that the purported board minutes dated 23.01.2007, disclosing the consent of the board of directors for the transfer of 23,200 shares (200 + 5000 by third respondent and 18,000 by second respondent) are fabricated, without conveying any valid title in favour of the petitioner. The petitioner, taking advantage of the signatures of the second respondent on blank papers, has fabricated the minutes of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... board resolution approving the transfers, became entitled to 23,200 shares, of the Company. The Company, acting upon the board resolution of 23.01.2007, opened an account with Andhra Bank, which is being operated by the petitioner and the second respondent, as the Chairman and Managing Director, respectively of the Company, as borne out by certificate dated 25.06.2007 and statements of account issued by Andhra Bank and as many as 70 cheques issued during the period between 21.02.2007 and 04.07.2007 by the petitioner and the second respondent in the name of the Company favouring its constituents accounting for over Rs. 70 lakhs. Similarly, the Company's accounts with the Citizen Co-operative Society Limited and Dena Bank, Hyderabad are to be operated by the petitioner and the second respondent jointly, on the strength of the written request dated 30.1 1.2006 of the second respondent and the board resolution dated 30.1 1.2006 resolving to open and operate a current account jointly by the Chairman and Managing Director of the Company. Thus, the petitioner is being involved in the day-to-day financial transactions of the Company. The second respondent has committed on 20.09.2007 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in this connection the following resolution was passed: Resolved that the board accords its consent for the transfer of shares in the following manner: The board took note of the shareholding pattern of Mr Mansani Krishna Kishore as 60% and Mansani Srinivasulu as 40%. A plain reading of the board resolution, not withstanding the stigma attached to it, would show that (a) the Company has received the application for transfer of 23,200 shares, with the respondents 2 3 as the transferors and the petitioner being the transferee; (b) the board went through the details of the application; (c) the board accorded its approval and consent for share transfers, as per the details contained in die resolution. The relevant articles governing transfer of shares are embodied in Clauses 16 to 21 and 23 and 25 thereof. The articles of association possessing statutory recognition, have a binding effect on the company and its members and also between the members inter se in relation to their rights as such members, and therefore, the company and the members are bound by obligations imposed by the articles. It is well settled that where any transfer of shares is in violation of articles, su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... member as to the fair value of a share, the Auditors of the Company shall on the application of either party certify in writing the sum which, in their opinion, is the fair value and such sum shall be deemed to be the fair value, and the same shall be binding on the proposing transferor and the purchasing member. 23. If the company does not within the space of 30 days, after being served with transfer notice, find a member or person selected as aforesaid willing to purchase the shares, and give notice in the manner aforesaid the proposing transferor shall at any time within the three calender months thereafter be at liberty (Subject to Article 3) to sell and transfer the share to any person and at any price. If no action has been taken by either party within the period the whole proceeding should be treated as cancelled and fresh notice and procedure as aforesaid once again in case transfer is desired. 25. A fee not exceeding one rupee may be charged for each transfer and shall, if so required by the directors, be paid before the Registration thereof or be waived as the Board of Directors may determine from time to time. After a careful scrutiny of the materials made avail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... while deals inter-alia with the incorporation of the Company, specially reports that the Company passed a resolution on 23.01.2007 appointing him as Chairman of the Company with effect from 23.01.2007, but the complaint is conspicuously silent about the board resolution according consent of the board for the transfer of 23,200 shares in favour of the petitioner and noting of the shareholding pattern of the petitioner as 40%, which to my mind is oddly unnatural. Any prudent person, ought to have, in the normal circumstances, reported in the police complaint, his status as a shareholder by acquisition of 40% of the shares, as approved by the board of directors in terms of the minutes dated 23.01.2007, which is apparently found lacking in the matter before me. It is, therefore, doubtful whether the board minutes dated 23.01.2007, as on the date of the above complaint did contain the board resolution, approving the transfers in the name of the petitioner, and thus the genuineness of the board minutes, containing the purported consent of the board for the transfer of 23,200 shares to the petitioner is in doubt. The police complaint dated 06.10.2007 does not either specify any theft of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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