VIJAY M SHAH Vs. FLEX INDUSTRIES LIMITED

JUDGEMENT

(1.) The petitioners have Filed this Company Petition under Section 81 and Section 10 and Rule 11 (b) and 17 of the Companies Act, 1959. The petitioners are shareholders of respondent Flex Industries Limited. They hold 1,37,500 shares among themselves.

(2.) The respondent-company issued 'Right Issue' on 16th September, 1995 and the Right Issue was closed on 15th October, 1995. According to the scheme of the issue, the petitioners were entitled to two right shares and one warrant, for every Five shares held as on the said date. According to the petitioners, they were entitled to 54960 right shares and warrants attached thereto and 27480 Rights debentures and warrants attached thereto as mentioned in the letter of offer. It is submitted by the petitioners that the Securities and Exchange Board of India (SEBI) have issued instructions to all the companies that with a view to protect the interest of investors , the letter of offer for 'Right Issue' be sent to the shareholders by registered post.

(3.) The petitioners submitted that they did not get a notice of 15 clear days as contemplated under Section 81, and consequently the petitioners have been deprived of their valuable rights in respect of Right Issue as well as warrants and debentures. The petitioners submit that at no time the said company as well as Registrar of Issue sent the letter of offer relating to the Right Issue cither at the foreign addresses or at the Bombay address.