PEERLESS GENERAL FINANCE & INVESTMENT CO. LTD. versus PODDAR PROJECTS LTD. & ANR.

Citation: [2007] 2 S.C.R. 573 · Decided: 13-02-2007 · Supreme Court of India · Bench: TARUN CHATTERJEE · Disposal: Disposed off

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Judgment (excerpt)

PEERLESS GENERAL FINANCE & INVESTMENT CO. LTD.
A
J
v.
PO DD AR PROJECTS LTD. & ANR.
FEBRUARY 13, 2007
[TARUN CHATTERJEE AND AL TMAS KABIR, JJ.]
B
r
Companies Act 1956-Sections 108, 391 and 394-Transfer of shares
·~
under scheme of arrangement-Registration of shares in name of subsequent
transferee-Execution of instrument of transfer-Compliance of-Held: Till c
the time the shares are not registered in the name of original transferee, it
cannot be registered in the name of subsequent transferee-During pendency
of appeal, company has registered the shares in question in the name of
original transferee, the question having been rendered academic, appeal is
disposed of
D
PU Company held certain shares of the appellant-company. Under a
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scheme of arrangement a part of the business division of PU was transferred
to the rt:spondent No.I. Thereafter, the respondent No.I sold the shares to
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the respondent No.2. Respondent no. 2 lodged the shares with the appellant-
company for registration twice. Appellant-company did not register the shares.
Respondents filed application. Company Law Board allowed the same and E
directed the appellant-company to register the original shares in favour of
the respondent No.I, but did not grant any relief to the respondent No.2.
Respondent No.2 did not file any appeal. Appellant-company filed an appeal.
High Court upheld the order of Company Law Board. Hence the present appeal.
Appellant-company contended that the question involved in the matter F
had been rendered academic since during the pendency of the appeal, the
appellant-company had registered the original shares in the name of the
respondent No.I-company; and that since the respondent No.2 had not
preferred any appeal against the order of the Company Law Board, the same
became final with regard to the respondent No.2.
G
_i.
Respondent No. 2 contended that the decision of the Company Law Board,
as applicable to the respondent No.I would also operate in its favour.
Disposing of the appeal, the Court
573
H
.i
. ·j..__
574
SUPREME COURT REPORTS
[2007] 2 S.C.R.
A
HELD: Till such time the shares were not registered in the name of the
-
respondent No.I, the application of the respondent No.2 for subsequent
registration of the same shares in its name could not be considered.
Accordingly, the direction given by the Company Law Board in respect of the
respondent No. I could not apply to the respondent No.2 and that is why the
B
said respondent No. 2 did not prefer any separate appeal against the order of
the Company Law Board. The questions raised in the appeal have been
rendered academic since the appellant-company has since registered
the shares in question in the name of the respondent No.I-company.
(Paras 4 and 5) [ 575-G, H; 576-A, BJ
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,.
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CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5929 of2005.
From the Judgment and final Order dated 2.8.2005 of the High Court of
Calcutta in ACO No. 215 of2004 in APOt No. 743/2004.
Ashok H. Desai, Bhaskar P. Gupta, S. Sukumaran and K. Rajeev for the
D Appellant.
R.F. Nariman, C. Mukund, Neeraj, Pankaj Jain, Ashok Kumar Jain and
Bijoy Kumar Jain for the Respondents.
.,
The Judgment of the Court was delivered by
E
ALT AMAS KABIR, J. I. Certain shares of the appellant-company were
being held by Poddar Udyog Limited. Under a scheme of arrangement
sanctioned by ~he Calcutta High Court on 19th August, 1997, a part of the
business division of Poddar Udyog Limited was transferred to the respondent
No. I herein. On 3rd September, 1999, the respondent No. I, Poddar Projects
F Limited, sold ~he shares to the respondent No.2, Vijaya Finance Corporation
Limited. The said respondent lodged the shares with the appellant-company
herein for registration on 12th November, 200 I. The appellant-company refused
to register the ~aid shares on 9th January, 2002 and intimated the advocate
for the respo~dent No.2 of its said decision.
G
2. On 16th May, 20.02, the shares were again lodged for registration on
behalf of the respondent No.1-Poddar Projects Limited, but once again the
appellant-company refused to register the same.
..... -
3. Such refusal led to the filing of an application by the respondents
H
herein under Section 111 A of the Companies Act, 1956 on 28th October, 2002.
I !
PEERLESS GENERAL FINANCE & INVESTMENT CO. LTD. •« PODDAR PROJECTS LTD. [ALTMAS KABIR.I.] 575
..,,..
The Company Law Board allowed the application file

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