111A. Rectification
of register on transfer.—(1) In this section
unless the context otherwise requires, “company”
means a company other than a company referred to in sub-section
(14) of section 111 of this Act.
(2) Subject to the provisions of this section, the shares
or debentures and any interest therein of a company shall
be freely transferable:
Provided that if a company without sufficient cause refuses
to register transfer of shares within two months from the
date on which the instrument of transfer or the intimation
of transfer, as the case may be, is delivered to the company,
the transferee may appeal to the Tribunal and it shall direct
such company to register the transfer of shares.
(3) The Tribunal may, on an application made by a depository,
company, participant or investor or the Securities and Exchange
Board of India, if the transfer of shares or debentures is
in contravention of any of the provisions of the Securities
and Exchange Board of India Act, 1992 (15 of 1992) or regulations
made thereunder or the Sick Industrial Companies (Special
Provisions) Act, 1985 (1 of 1986) or any other law for the
time being in force, within two months from the date of transfer
of any shares or debentures held by a depository or from the
date on which the instrument of transfer or intimation of
the transmission was delivered to the company, as the case
may be, after such inquiry as it thinks fit, direct any depository
or company to rectify its register or records.
(4) The Tribunal while active under sub-section (3), may
at its discretion make such interim order as to suspend the
voting rights before making or completing such inquiry.
(5) The provisions of this section shall not restrict the
right of a holder of shares or debentures, to transfer such
shares or debentures and any person acquiring such shares
or debentures shall be entitled to voting rights unless the
voting rights have been suspended by an order of the Tribunal.
(6) Notwithstanding anything contained in this section, any
further transfer, during the pendency of the application with
the Tribunal, of shares or debentures shall entitle the transferee
to voting rights unless the voting rights in respect of such
transferee have been suspended.
(7) The provisions of sub-sections (5), (7), (9), (10) and
(12) of section 111 shall, so far as may be, apply to the
proceedings before the Tribunal under this section as they
apply to the proceedings under this section.
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