In Brief
The appellants purchased 10,51,933 equity shares from respondent No. 2 on 18.04.2015 for ₹14.67 crore but discovered their names were erased from the company's records. They sought rectification of the Register of Members and action against respondents for fraud. The NCLT dismissed the petition summarily, and the NCLAT upheld the dismissal. The Supreme Court held that the NCLT failed to properly examine the documentary evidence (share certificates, transfer deeds, emails) and undisputed facts (receipt of monies) before dismissing the petition. The Court emphasized that rectification proceedings require thorough examination of facts on the principle of preponderance of probabilities and that the respondent's contrary narrative required proof. The appeals were allowed and the case remitted to the NCLT for fresh consideration on merits with proper appreciation of evidence.
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