Mrs. Sonal Shankregauda was a shareholder in Skyscrapers Limited. She died after executing a will under which Dhiren, a son of Mrs. Sonal Shankregauda, was to inherit all his properties including the shares held by her.
CS Professional · Drafting, Pleadings and Appearances · PYQS · June 2024
Mrs. Sonal Shankregauda was a shareholder in Skyscrapers Limited. She died after executing a will under which Dhiren, a son of Mrs. Sonal Shankregauda, was to inherit all his properties including the shares held by her. The Articles of Association of Skyscrapers Limited vested with the Board of Directors absolute discretion in regard to registration of transfer of shares. The Board of Directors refused to register the transmission of shares to Dhiren on the ground that Dhiren is a known criminal. (i) What are the documents Dhiren has to submit for transmission of shares in his name ? (ii) Is the refusal to register the transmission of shares by the Board of Directors of the company, correct ? (iii) What are the remedies available to Dhiren ?
Answer & Explanation:
Documents Dhiren has to submit for transmission of shares in his name: Letter of Request accompanied by Probate/Letters of Administration and any other documents as may be required by the Company in accordance with its Articles of Association. Correctness of refusal to register the transmission of shares by the Board of Directors of the company: The refusal to register transmission of shares by the Board is not correct and it must register the transmission of shares once Dhiren produces the proof of succession. Remedies available to Dhiren: Dhiren can send a legal notice to the company citing the legal provisions and requiring the company to register the shares in his name. Failing this, he can institute proceedings to redress his grievance against Skyscrapers Ltd. before the concerned authority under the Companies Act, 2013.
Topics: Company Law
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