The New Delhi Bench of the National Company Law Appellate Tribunal (NCLAT) on 21 August dismissed an appeal filed by Titus Babu challenging the cancellation of his 1,35,000 equity shares in Sintex Industries Limited (SIL), observing that an approved Resolution Plan extinguishes pre-existing equity shareholding and binds shareholders and members
A Bench of Judicial Member Justice Mohd Faiz Alam Khan and Technical Member Naresh Salecha held that Section 59 of the Companies Act, 2013, which provides for rectification of a company’s register of members, cannot be used to revive shareholding extinguished under an approved Resolution Plan or to seek substantive compensation. It held:
“We note that Section 59(2) of the Companies Act 2013…