· Notice about refusal to
register the shares, must be given by the company to the transferor and transferee,
within two months, to the transferor and transferee. Company shall also intimate
the reasons for refusal.
· Transferor or transferee, may appeal to
the Company Law Board (CLB) in Form No. 1, as specified in CLB regulations, 1991,
within two months of the receipt of notice of such refusal, or
Where the
company has sent no notice, within four months from the date on which the instrument
of transfer was delivered to the company.
· Company Law Board, after
hearing the parties, may pass any of the following orders.
- Dismiss
the appeal, or
- Direct that transfer shall be registered within 10 days
of he receipt of order, or
- Direct the rectification of the register and
also direct the company to pay damages, if any, sustained by any party aggrieved,
or
- May grant any interim injunction or stay, or
- Incidental
or consequential orders regarding payment of dividend or the allotment of bonus
or rights shares.
· In case of any default by the company,
in complying with the orders of Company Law Board, the company ordinary defaulting
officers may be fined in monetary terms.
