Section 59: Rectification of register of members
This section is for rectifying errors or omissions in a company's register of members.
The section, clause by clause
What the section says
In plain terms
(1)If the name of any person is, without sufficient cause, entered in the register of members of a company, or after having been entered in the register, is, without sufficient cause, omitted there from, or if a default is made, or unnecessary delay takes place in entering in the register, the fact of any person having become or ceased to be a member, the person aggrieved, or any member of the company, or the company may appeal in such form as may be prescribed, to the Tribunal, or to a competent court outside India, specified by the Central Government by notification, in respect of foreign members or debenture holders residing outside India, for rectification of the register.
If someone's name is incorrectly added or removed from a company's register of members, or if there is a delay in updating the register, the affected person, a company member, or the company can appeal to the Tribunal or a specified court for rectification of the register.
(2)The Tribunal may, after hearing the parties to the appeal under sub-section (1) by order, either dismiss the appeal or direct that the transfer or transmission shall be registered by the company within a period of ten days of the receipt of the order or direct rectification of the records of the depository or the register and in the latter case, direct the company to pay damages, if any, sustained by the party aggrieved.
The Tribunal can then order the company to register a transfer or transmission within 10 days, rectify the records, or pay damages to the affected party.
(3)The provisions of this section shall not restrict the right of a holder of securities, to transfer such securities and any person acquiring such securities shall be entitled to voting rights unless the voting rights have been suspended by an order of the Tribunal.
This section does not limit the right to transfer securities, and the buyer of securities is entitled to voting rights unless they have been suspended by the Tribunal.
(4)Where the transfer of securities is in contravention of any of the provisions of the Securities Contracts (Regulation) Act, 1956 (42 of 1956), the Securities and Exchange Board of India Act, 1992 (15 of 1992) or this Act or any other law for the time being in force, the Tribunal may, on an application made by the depository, company, depository participant, the holder of the securities or the Securities and Exchange Board, direct any company or a depository to set right the contravention and rectify its register or records concerned. 1*
If a securities transfer breaks any laws, the Tribunal can order a company or depository to correct the mistake and update its records.
(4)*.
The right-hand column is written from the section text, not quoted from it, and it has no legal force. Where the two differ, the left-hand column is the law.
Amendment notes
- 1. Subs. by Act 29 of 2020, s. 9, for sub-section (6) (w.e.f. 21-12-2020).
- 1. Sub-section (5) omitted by Act 29 of 2020, s. 10 (w.e.f. 21-12-2020).
Referred to by
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Reproduced from the official India Code print for reference. Check the current text on India Code before you rely on it, and read the section alongside its Rules. Nothing here is legal advice.