Discuss the remedies available for Preference shareholders in relation to redemption of preference shares.

The matter of remedies available for preference shareholders in relation to redemption of preference shares has been discussed in the case of Bank of Baroda Vs. Aban Offshore Limited as decided by the National Company Law Appellate Tribunal (NCLAT), New Delhi. The National Company Law Appellate Tribunal (NCLAT), New Delhi held that intention of the legislature while promulgating Section 55 of the Companies Act, 2013 was to compulsorily provide for redemption of preference shares by doing away with the issue of irredeemable preference shares. Therefore, even though there is no specific provision stipulated under the Companies Act, 2013 through which relief can be sought by preference shareholders in case of non-redemption by the company or consequent non-filing of petition under Section 55 of the said Act, the intention of the legislature being clear and absolute, Tribunal's inherent power can be invoked to get an appropriate relief by an aggrieved preference shareholder(s). Alternatively, preference shareholders coming within the definition of 'member(s)' under Section 2(55) read with Section 88 of the Companies Act, 2013, may file a petition under Section 245 of the said Act, as a class action suit, being aggrieved by the conduct of affairs of the company. Thereby, it was held that preference shareholders are not remediless and for redemption of preference shares, they can file an application under Section 55(3) of the Companies Act, 2013 or alternatively they may also file application under Section 245 of the Companies Act, 2013 as a class action suit and the NCLT while exercising the inherent power viz. Rule 11 of NCLT Rules, 2016 can pass appropriate order. With the above discussions, the court was of the view that the preference shareholders are not remediless and for redemption of preference share, can file application under Section 55(3) of the Companies Act, 2013. They may also file application under Section 245 of the Companies Act, 2013 as a class action suit and the NCLT while exercising the inherent power viz. Rule 11 of NCLT Rules, 2016 can pass appropriate order. The Hon'ble Supreme Court, while considering an appeal by the Company against the above order, upheld the order passed by the NCLAT.