• Blocking of sale of assets

Can 35% shareholders block the sale of an asset by the company?
Asked 6 years ago in Business Law

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8 Answers

See if the company passes a resolution and there is no stay from tribunal or court order they cannot block sale .

Shubham Jhajharia
Advocate, Ahmedabad
25513 Answers
179 Consultations

Notice must be given to the members that the resolution for asset sale is proposed to be passed as a special resolution by way of postal ballot / electronic voting. The notice must be accompanied by an “Explanatory Statement”, pertaining to the said Resolution, mentioning the material facts concerning the item and the reasons should also be enclosed along with a Postal Ballot Form (See Section 102 of the Companies Act, 2013

 

2) shareholders can oppose passing of said resolution 

Ajay Sethi
Advocate, Mumbai
99877 Answers
8150 Consultations

Rest 65% share holder can pass the order in the extra General Annual Meeting for Sale of Assets.

Ganesh Kadam
Advocate, Pune
13008 Answers
267 Consultations

No they can't

Prashant Nayak
Advocate, Mumbai
34590 Answers
249 Consultations

Yes, the share holder having that holding in the company can apply for stalling the sale of the asset of the company of the same is apparently is not good for the company.

The welfare of the company alone is the issue and not the pattern of shareholding.

The NCLT at the option of any share holder can stop such sale if it is shown to be not in interest of the company.  

Devajyoti Barman
Advocate, Kolkata
23656 Answers
537 Consultations

Majority share holder can obtract. If you have allieds with 51% majority you can . 

Yogendra Singh Rajawat
Advocate, Jaipur
23085 Answers
31 Consultations

Hi, yes they can file a civil suit for injunction in court and obtain stay order on the same 

Hemant Chaudhary
Advocate, Gurgaon
4632 Answers
67 Consultations

In practice, private companies often have suitable articles or contracts so that the remaining owner-managers retain control if an individual leaves the company. For example, the articles or contract may say that, if a shareholder wants to dispose of their shares, they must offer them to the other shareholders (usually in proportion to the shares that each already holds) before they can dispose of them to anyone else. In such circumstances, the employee or director may, dependent on the circumstances in which they have left, be entitled to receive a 'fair value' for the shares - often determined by the company's accountants if it cannot be agreed any other way - or may merely be entitled to the nominal value of the shares.

The shareholder may have a claim against the company or the other shareholders if they can show that they have been unfairly treated.

 

T Kalaiselvan
Advocate, Vellore
90079 Answers
2501 Consultations

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