CASTROL INDIA LTD Vs. S S MEHTA

JUDGEMENT

(1.) CASTROL India Limited has filed three references under Section 22A of the Securities Contracts (Regulation) Act, 1956, seeking confirmation of this Bench with regard to the opinion formed by the committee of directors in meetings hold on June 28, 1992, and August 11, 1992, refusing the request to register the transfer of 6,350 shares in Reference No. 20/SC/ CLB/WR/92, 2,595 shares in respect of Reference No. 22/SC/CLB/WR/92 and 65,635 shares in Reference No. 23/SC/CLB/WR/92 on the ground that it would contravene the provisions of Sub-clauses (b) and (d) of Sub-section (3) of Section 22A of the Securities Contracts (Regulation) Act, 1956. In Reference No. 20/SC/CLB/WR/92 shares were transferred by Mr. Sudhir Shantilal Mehta, Mrs. Rasila Shantilal Mehta, Mrs. Deepika Ashwin Mehta, Mrs. Jyoti Harshad Mehta, Mr. Harshad S. Mehta and Mr. Ashwin Shantilal Mehta. In Reference No. 22/SC/CLB/WR/92, 2,595 shares have been transferred by Mrs. Deepika Ashwin Mehta, Mr. Sudhir Shantilal Mehta, Mrs. Jyoti Harshad Mehta and Growmore Research and Assets Mgt. Ltd. In Reference No. 23/SC/CLB/WR/92, 65,635 shares have been transferred by Mrs. Jyoti Harshad Mehta, Mr. Sudhir Shantilal Mehta, Mrs. Deepika Ashwin Mehta, Mr. Ashwin Shantilal Mehta, Growmore Research and Assets Mgt. Ltd.. Mrs. Rasila Shantilal Mehta and Mr. Harshad S. Mehta. In the resolution passed by the committee of directors, it was noted that the request for transfer of shares would be in contravention of "the Special Court (Trial of Offences Relating to Transactions in Securities) Ordinance, 1992, and the notification issued under Section 3(3) by the custodian".

(2.) During the hearing Mr. Shyam Mehta, advocate, instructed by Kanga and Co., advocates and solicitors, appearing on behalf of Infrastructure Leasing and Financial Services Ltd., Mr. C. V. Ramachandra, authorised representative of Pars Holdings and Consultants Ltd. and Shri R. A. Sabnis, authorised representative on behalf of Ms. Radha R. Sabnis, requested for adjournment in respect of Reference No. 23 so far as transfer of shares by them was concerned as they would require some more time to file their detailed replies. Other transferees involved in Reference No. 23/SC/ CLB/WR/92 wanted that their cases should not be adjourned. In view of this, these orders will cover all the shares referred to in References Nos. 20 and 22 and in respect of Reference No. 23, all the shares except 50 shares of Ms. Radha R. Sabnis, 350 shares lodged by Pars Holdings and Consultants Ltd. and 6,500 shares lodged by Infrastructure Leasing and Financial Services Ltd.

(3.) DURING the hearing Mr. Y. H. Mithi, advocate appearing for the custodian, pointed out that under Section 5(2) of the said Ordinance, 1992, now replaced by Act 27 of 1992, all the transferors in the above three references have been notified and all the properties of the persons notified stand attached simultaneously with the issue of notification under Section 3(3) of the said Ordinance. He further pointed out that as the shares stand in the names of these notified persons, they cannot be transferred until the special court permits such transfers.