A closely held public Company has not issued shares certificates to its shareholders. one of the shareholder was also a director in the Company, but due to some problem he was not able to attend four consecutive board meetings of the company and he was removed from the board. Now the directors are planing to sell the company, and as the minor shareholders are not even having share certificates with them, nor they have any person to represent them on the board. What is the remedy available to the shareholders, if they do not have any proof of amount paid to the company for the shares, nor they have any certificate with them, there is an probability that share holder's register might be altered with ill intentions by the present directors of the company. Please guide me that what actions should one take, whom to appeal. Kindly guide.
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Remedies available to shareholders in case of froud.
Dear Member,
In this case you may initially check the following documents:
1. Annual Return
2. Subscripttion Clause
3. Mode of payment by aggrieved party towards share capital
4. List of shreholders submitted with local authrity, bank etc. like for the purpose of allotment of land or borrowing or sales tax reg , service tax reg.
5. Additionally you may also check ITR of the Company . Company need to incorporate details of shareholders holding 10% or more.
Pls revert after checking of above said then I will try to suggest further on this.
Additionally file a wriiten complain with concerned ROC, peruse the case and try to get the company declared as disputed on website of MCA.
This will prevent registration of any form on MCA. Hence no change in company is possible. But they can sell the assets.
regards
Gaurav Jain
gaurav @ rsj.co.in
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