Share Transfer

5000 shares in a private limited company held by an Indian resident was sold to a British National residing in UK in June 2018. MOU and share transfer forms were signed. The purchaser i.e. the British National did not pay the amount to the seller. In fact, the British National transferred the said amount from another party's account which is a Trust registered in British Virgin Islands and that too to the account of the wife of the Indian Shareholder. The FCTRS was therefore not approved by RBI. Despite repeated reminders from the Indian Shareholder, the British National did not complete the transaction. However, the Indian Company filed it's report MGT-7 with ROC and reflected that the British National is the holder of 5000 shares and he was also appointed as a director of the said company in 2018 and it continues to be so as on date. The question is 1) can the Indian Shareholder reclaim the shares? 2) What steps are to be taken? 3) Who would be responsible for acts and misdeeds, if any, by the company and its shareholders and directors. 4) Does the Indian Shareholder is deemed to be the shareholder since the transaction has not been completed and has also not been approved by the RBI? Thanks...PK