RE: LEGAL OPINION IN CONNECTION WITH 15 (FIFTEEN) LOST SHARES OF THE BANK AND ISSUANCE OF DUPLICATE CERTIFICATE IN RELATION TO THE SAME.
We refer to your letter dated 19.03.2008 on the above subject.
On perusal of your letter, it appears that on 10.7.2007 Bank 1 (the “Bank”) received a letter from Mr. X wherein he stated that 15 (fifteen) shares of the Bank (the “Shares”) under certificate nos. 010513, 061264 & 072772 (the “Share Certificates”) were purchased by him through Company 1 and the Share Certificates along with the relevant instruments of transfer (Form 117) were lost from his custody. Mr. X has requested the Bank to transfer the Shares to his name.
Mr. X has provided the Bank with the transaction copy of the above securities dated 12.09.2006 and a certificate from Company 1 in support of the genuineness of his purchase of the Shares along with other evidences/documents.
In the circumstances stated above, you require our legal opinion as to whether the Bank may issue duplicate share certificate in lieu of the lost Share Certificates and thereafter transfer the Shares to the name of Mr. x.
Section 38(3) of the Companies Act 1994 states as follows:
“(3) It shall not be lawful for the company to register a transfer of share in or debentures of the company unless the proper instrument of transfer duly stamped and executed by the transferor and the transferee has been delivered to the company along with script:
Provided that, where it is proved to the satisfaction of the directors of the company that an instrument of transfer signed by the transferor and transferee has been lost, the company may, if the directors think fit, on an application in writing made by the transferee and bearing the stamp required by an instrument of transfer register the transfer on such terms as to indemnity as the directors may think fit.”
Therefore, according to the above section, in order for the Bank to register the transfer of the Shares to the name of Mr. x, the following documents have to be submitted to the Bank by Mr. X along with his application for the registration of transfer of shares:
a) The proper instrument of transfer duly stamped and executed by the transferor and the transferee (Form 117). However, we have been informed that Mr. X has lost the relevant Form 117 along with the Share Certificates. Therefore, if it is proved to the satisfaction of the directors of the Bank that the relevant Form 117 has been lost, the Bank may, if the directors think fit, on an application in writing made by Mr. X and bearing the stamp required by a Form 117 register the transfer without the Form 117 on such terms as to indemnity as the directors may think fit. From the provided documents it appears that Mr. X has submitted an Indemnity Bond dated 09.10.2007 in favour of the Bank. We have perused the said indemnity bond and the same appears to be in order.
b) The relevant Share Certificates being nos. 010513, 061264 & 072772. However, as the Share Certificates were lost by Mr. X, we are of the opinion that Bank may issue duplicate share certificates in lieu of the lost Share Certificates i.e. share certificate nos. 010513, 061264 & 072772, in accordance with Article 13 of the Articles of Association of the Bank.
Thereafter the Bank may register the transfer of the Shares in the name of Mr. X provided that the directors of the Bank are satisfied with the papers/documents submitted by him.
Should you have any further query, do not hesitate to revert to us.
For: “The Lawyers & Jurists”