SHYAMA PRASAD MURARKA Vs. CALCUTTA STOCK EXCHANGE ASSOCIATION LTD

JUDGEMENT

(1.) THE genesis of disputes in this matter arose in the refusal of THE Calcutta Stock Exchange Association Limited ('CSEA') to register share No. 127 in the name of the petitioner, a member of CSEA, purchased by him for valuable consideration from another member of CSEA. Proforma Respondent.

(2.) The brief facts relating to the case are that on 15-5-1995, Shri Radha Kishan Purohit (Proforma Respondent) sold his share No. 127 in CSEA to the petitioner for a consideration of Rs. 2.00 lakhs. The said sum was duly paid the petitioner by cheque dated 15-5-1995.

(3.) THE learned counsel appearing for CSEA argued that on proper interpretation of Section 111A, the present application is not maintainable as the request to transfer the share was made by the petitioner on 30-6-1995 and there was no refusal by CSEA within a period of two months. THE refusal was made after two months and the instant application was made within two months from the date of refusal. In this connection, he drew our attention to Ramaiya's Guide to companies Act, fourteenth Edition, page 1071 under the heading 'Scope of Section'. It has been further argued that CSEA had a lien in respect of the share in question and forfeited the same in exercise of its powers provided in the Articles of Association and its Bye-laws. He relied upon Articles 29, 30, 31, 32, 34, 39, 40, 45 and 46. It has been further submitted that ninety five arbitration claim cases were instituted against the Proforma Respondent for diverse breaches and defaults committed by him and two of such claims were instituted on 17-2-1995 and 17-4-1995, which were long prior to the sale of share in question on 18-5-1995. Inasmuch as at least two cases were pending against the Proforma Respondent prior to the date of sale, the said Proforma Respondent Could not have sold and the petitioner could not have purchased the same. It has been further contended that CSEA in terms of its articles ultimately forfeited the share in questing after giving numerous and repeated opportunity of hearing to both the transferor and transferee and inasmuch as there was no refusal on the part of CSEA to register the share within a period of two months from the date of lodgement. Accordingly, CSEA is not now bound to register such share in the name of the petitioner.