The Supreme Court has posted for final hearing a petition filed by a shareholder of Reliance Industries (RIL) seeking compensation of around Rs 20 lakh from the company for failing to transfer in her name 25 shares she had bought in 1994. In her appeal before the court, Neera Maheshwari, has sought damages from RIL and Hyderabad-based brokerage firm Karvi Consultants at the rate of Rs 500 per day with 18% interest between November 1994 and February 2003 claiming she suffered huge loss due to non-availability of share certificates.
A Bench headed by Justice P Sathasivam posted the matter for final hearing while refusing RIL senior counsel R Nariman’s contention that nothing survives in the petition. The matter reached the apex court in 2006 after her appeal was dismissed by the National Consumer Dispute Redressal Commission on the grounds that a consumer court did not have power to award compensation for such cases.
Maheshwari’s appeal was dismissed in February 2008 for non-appearance but was restored by the court earlier this year. RIL has submitted that the complaintant held 100 shares in the erstwhile Reliance Polyethylene Ltd (RPL) which was merged with the parent company in 1995. Consequently, 100 RPL shares were converted into 25 RIL scrips and the certificates were allotted to the complainant in 1995 itself, RIL said. The company said the amount was not credited and the conversion of shares of the complainant was kept in abeyance due to non-confirmation of Stock Invest Application. Besides, RIL said Maheshwari’s grievance had been redressed and claimed that the complaint was devoid of merit and liable to be dismissed with costs.
It stated that Section 10 of the Companies Act prohibited filing of the case against a company in any court other than the court within local jurisdiction of the registered office of the company. Maheshwari had moved the district forum seeking damages and Rs 30,000 towards cost of litigation from RIL for failing to get share certificates, bonus certificates and dividend within the prescribed period of three months as required under Section 53 of the Companies Act.