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rajiv (director)     01 June 2014

Illegal share dilution & directorship resolution obstruction

THE LAW should be applied fairly and correctly  ???

I need urgent and specialist CLB layers or retired judge’s assistance. I am aggrieved by a CLB order. I live in the UK and hope coming to the forum would be helpful.  

I and my paternal uncle formed a Pvt. Ltd. Company in India in 2000. The company only has a land and a factory thereon. The factory is rented out and the company does not carry out any business. I had 50%, my uncle had 49% and my aunty had 1% shares. My paternal uncle and his wife were the only two directors. Status quo continued till 2005 when my uncle fell ill. He invited me to India to assist with the company matters and take charge. The full body of shareholders and all/both the directors passed a resolution to make me a director. However I did not have a PAN & DIN number. Applications were made in order to then complete form 32. Unfortunately my uncle died in Jan 2007 before the completion of form 32. Immediately after my uncle’s death my aunty stopped communicating with me and ignored my attempts to contact her.

 I was ignorant of law and on ill advice from an advocate I commenced a civil suit in 2008. Then in 2011 I was advised that only CLB can grant the required prayers. We prepared and filed a CLB petition in Feb.2012. On acceptance of my CLB petition I withdrew my civil suit. During the preparation of the CLB petition, to my horror it was discovered that the defendant, without any information or notice, had reduced my shareholding to 8%.         

 I was convinced that mine was an open-and-shut case. I have overwhelming amount of proof/documents to support my case against the defendant’s mismanagement of the company affairs. The defendant’s defense is emotional and unconvincing.  

 The CLB judge has made many blatant errors in his order and it seems he has used his discretion unfairly and sympathized with the defendant.

 On appeal the high court judge rejected the appeal on the basis that –

No Question of Law arises. There is no merit in the appeal. It is dismissed.

 I know judges do not give incorrect decisions. However this IS a grave mistake and it should not be acceptable in the justice system.

 I would like to know my position. If you can help I would send you details of the case and want you to advise me. If you find that I do have a just cause for grievance then you are requested to comment and provide applicable citations of case laws in support of my case.

I will reimburse for your advice and citations. I have to file my Supreme Court appeal with next two weeks. Please respond urgently


 6 Replies

Advocate Ravinder (Advocate/Attorney)     01 June 2014

If you can pay my fee, I will take up your case.  If you are interested send me the scanned copies of Judgement of CLB dismissed order of High Court and all relavant papers.  If the bunch of documents is huge, then you send it by DTDC courrier.  My email id

T. Kalaiselvan, Advocate (Advocate)     02 June 2014

You can search a lawyer dealing with CLB cases from the LCI database having credentials what you are looking for and make an approach yourself.

Amritesh Mishra (Advocate)     02 June 2014


Your shareholding was reduced to 8% without your consent as per your statement. Your share might have been transferred to someone and intimation might have been sent to concerned ROC. After the death of your uncle someone  might have been appointed as director to comply with the section 252 of the companies Act and the intimation of the same must have been filed with ROC.

You must  collect these information. This will help you.

 If you have further query, Pleas post.

rajiv (director)     02 June 2014

Amritesh ji,


Thank you for your response.


It is a fact and established on the ROC records that I was a 50% shareholder from 2002 to 2008. My uncle died in 2007. Has the defendant not contravened company law by not serving me with any notices prior to the above activities? Are there circumstances when notices don’t have to be served to a 50% shareholder before diluting his shareholding?    


Second question; prior to the death of my uncle, the full body of shareholders and all/both the directors of the company passed a resolution to make me a director. However I did not have a PAN & DIN number therefore applications were submitted in order to then complete the form 32. While PAN & DIN applications were in progress my uncle died. In LAW what is the position/strength of the resolution to make me a director?





Amritesh Mishra (Advocate)     02 June 2014

Even if You hold  one share your share cannot be transferred to anyone without your consent. This is a fradulent transfer.

As far as your Second Question is concerned, any change in composition of director must be filed within 30 days of passing resolution. Do you have copy of resolution?\

rajiv (director)     02 June 2014

Amritesh ji,


Can 50% shareholding be diluted by issuing new shares without notice/knowledge of the 50% shareholder?


I do have a copy of the resolution but because I had to wait for DIN number, more than one month had elapsed. I suppose there is nothing I can do?



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