Equity share
Rajesh Agarwal
(Querist) 30 July 2013
This query is : Resolved
Dear Sirs!,
I like to share one of the dispute which is still pending in the court for resolution.
The matter is I had 100 shares in my name in my D-mat account of a company, the company brings a buy back offer and a scheme for buy back is being framed and is approved by the Bombay High Court. The scheme is for every share the company will pay me Rs.100.00 in Cash by Cheque and for each share 5 debentures of Rs.10/= each which would be redemmed at the end of 1year of the allotment of the debentures. The buy back offer is being sent to each and every share holder by the company along with a option form to be submitted to the company if any share holder does not want to participate in the buy back offer along with a crossed cheque of Rs.10000.00 as part consideration of the shares buy back money. I have refused the buy back offer of the company and returned the cheque along with the option form to the company's Registrar and Share transfer Agent specifying not to participate in the buy back offer of the company. But after a lapse of 4 to 5 months I found that the shares from my D-mat account were debited and some 500debentures of Rs.10/= each were credited in my account. I contacted with the Registrar and Share Transfer Agent of the Company they never responded to my queries at last I filled a suit against the Company and the Registrar and Share transfer Agent specifying the deficiency of the company and the Registrar and Share transfer Agent's who later said that they have not received the option form sent by me to the Registrar and Share transfer Agent and also said that I have en cashed the cheque being sent by them in an affidavite filled by them in the consumer court moreover they have also said that it is not a consumer dispute. I have every prove that I have not en cashed any such cheques sent by them.
Sir , I have some specific queries regarding the above noted case, hope you would help me in getting the answers of the queries;
1. Registrar and Share transfer Agent is a service provider to the company and it's share holders for which he is being paid by the owner of the company of which the share holder is also one of the owner. It is grossly an defficiency in service of the Registrar and Share transfer Agent so it is a case of Consumer Dispute.
2. Any company coming up with a buy back offer of shares has to pay the buy back price of the shares to its shareholders by cash only as per Company's Act 1956. In this case the company has got a scheme of buy back of shares approved by the Bombay High court by paying the part consideration money of the share buy back in Cash and part by it's own Debentures, over-rulling the one of the specific criteria of Buy Back of Shares to be adopted by the Company in Share buy Back.
3. As per comapany's Act 1956 I have read that Shares are goods.
Dear Sirs in this above case I would request your valued suggestions and answers to my specific queries such as weather the above case is a Consumer Dispute, Is the scheme approved by the Bombay High Court is bad or not and can be Challenged, or any other related your valued suggestions that how a specific criteria.
Awaiting for your valued suggestions.
Thanking you',
with warm regards,
Rajesh Agarwal.
ajay sethi
(Expert) 31 July 2013
yes it would be a consumer dispute .
in your case you have to prove that you had returned the option form along with the cheque to the company .
buy back scheme was not mandatory . you had the option to exeercise buy back or not . the schem approved by HC is valid
Guest
(Expert) 31 July 2013
Company's Registrar and Share transfer Agent works for and on behalf of the company. Basically, according to my opinion, your dispute should lie with the company for the illegal act by its Registrar and Share transfer Agent. So, as far as the dispute is with the company, the matter would lie under the jurisdiction of the National Company Law Tribunal. So, in that case both the company as well as the Registrar are liable to be made party of the dispute.
However, if your dispute is restricted up to the service part of the company's Registrar and Share transfer Agent is concerned, your dispute would lie with the consumer forum. But, still company may also have to be made a party to the suit, as the matter of dispute lies between the company and the member of the company, as a shareholder.
Rajesh Agarwal
(Querist) 04 August 2013
Respected Sirs,
Please help me out with specific answers to my queries such as;
1. Is it a Consumer Dispute Case?
2. Weather a Company registered with Registrar of Companies under Companies Act 1956 and governed with SEBI's regulations can pay in it's BUY BACK offer of shares other than in Cash?
3. Can a Scheme of Buy Back offer of shares can be approved by a High Court with out fulfilling the Requirements of the Companies Act 1956 under which the said company is Registered.
4. Is shares are goods as per Companies Act 1956?
Thanking you',
with regards,
Rajesh Agarwal.
