Supreme Court Ruling: Fraudulent Share Transfer Struck Down: Key Takeaways from the Satori Global Judgement
The Supreme Court ruled that the NCLT has wide jurisdiction under Sections 397 and 398 of the Companies Act, 1956, to adjudicate on allegations of fraud, oppression, and mismanagement when integral to the complaint. It upheld that acts violating the Articles of Association and statutory provisions, including invalid share transfers and board meetings, constitute oppression, empowering the Tribunal to grant comprehensive relief.
Facts Of The Case:
The case involves Mrs. Shailja Krishna, a majority shareholder holding over 98% of a private company, and her husband, Mr. Ved Krishna. In December 2010, during a strained marital relationship, Mrs. Krishna allegedly resigned from her directorship and executed a gift deed transferring her entire shareholding to her mother-in-law. She contended s...