Case Overview

This petition (CP/2/59/AMR/2022) was filed on February 10, 2022, by Shri Hemanth Kumar Patibandla (Petitioner No. 1) and Shri Srinivasa Babu Patibandla (Petitioner No. 2) against STBL Projects Limited (Respondent No. 1) and eight other respondents, including its directors and a company secretary. The petition was filed under Sections 59, 210, 213, 447, and 448 of the Companies Act, 2013.

The principal allegations by the Petitioners are that the Respondents illegally and fraudulently transferred their shareholding of 1,000 equity shares each (0.01% of paid-up capital each) without their knowledge or consent. The Petitioners alleged that the Respondents forged their signatures on share transfer forms (Form SH-4) and backdated the transfers to April 27, 2018. They further alleged that a director resignation letter for Petitioner No. 1, dated March 25, 2016, was also fabricated and filed with the RoC using a fictitious email address (gokeda@gmail.com). The Petitioners claimed they never received any consideration for the shares and never executed any transfer instruments.

The Respondents countered that the share transfers were legitimate and part of a broader settlement agreement dated July 26, 2017, following the dissolution of the marriage between Petitioner No. 1 and the daughter of Respondent No. 2 (the Managing Director). They claimed consideration of Rs. 10,000 was paid in cash for each block of 1,000 shares, though no proof of payment was provided. They argued the petition was motivated, time-barred, and involved questions of fact that should be tried in a civil court.

The Tribunal noted several inconsistencies in the Respondents' documents, including that split share certificates issued on April 27, 2018, were referenced in share transfer forms executed on April 10, 2018. The Respondents failed to comply with the Tribunal's order to submit the original SH-4 forms and resignation letter for forensic examination, instead filing an appeal with the NCLAT, which is pending.

Final Outcome

The Tribunal, confining itself to the primary relief of rectification of the register of members, found sufficient grounds to doubt the authenticity of the share transfer documents and the compliance with the Companies Act, 2013, and its rules.

The NCLT did not issue a final ruling on the rectification but directed the Registrar of Companies (RoC), Vijayawada, to conduct a detailed investigation. The RoC is to examine all relevant records, including the Register of Members, Register of Issue of Share Certificates, the disputed SH-4 forms, Board Meeting minutes, and other pertinent documents related to the transfer of the 2,000 shares in question.

The RoC is required to submit a detailed report on its findings within six weeks. The matter is listed for the next hearing on September 10, 2026, for consideration of the RoC's report. The final decision on the petition for rectification of the share register is contingent upon the findings of this investigation.

Topics: Share Transfer Dispute, Corporate Fraud, NCLT Proceeding