The dispute started with Mrs. Shailja Krishna, who along with her husband, Mr. Ved Krishna, promoted Sargam Exim Private Limited in 2006 (later renamed Satori Global Limited).
Initially, Mrs. Krishna held almost 98% shares of the company. However, in December 2010, a controversy arose when she allegedly resigned as director and transferred her shares through a gift deed to her mother-in-law, Mrs. Manjula Jhunjhunwala.
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Mrs. Krishna later claimed she was coerced into signing blank documents, and that the gift deed and share transfers were fraudulent. She approached the NCLT Allahabad, which in 2018 ruled in her favor by restoring her as the rightful shareholder and director.
However, the NCLAT New Delhi overturned this in 2023, holding that NCLT did not have jurisdiction to decide on issues of fraud. Mrs. Krishna then moved to the Supreme Court.
1. Maintainability of Petition
The Court held that Mrs. Krishna’s petition before the NCLT was maintainable under Sections 397 and 398 of the Companies Act, 1956.
“Minority shareholders should not be rendered remediless,” observed the Court.
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2. Power of NCLT
The bench clarified that the NCLT has wide powers to decide on issues relating to oppression and mismanagement, including fraudulent share transfers.
3. Gift Deed Invalid
The Court declared the 2010 gift deed invalid, noting it violated the Articles of Association (AoA).
“Transfer to a mother-in-law by way of gift is not permitted under the AoA,” the Court said.
4. Share Transfer Forms Tampered
The Court found clear manipulation and overwriting in the share transfer forms. Dates were altered to make the transfer appear valid, making the documents unreliable.
5. Board Meetings Invalid
The board meetings of 15.12.2010 and 17.12.2010 were declared illegal, as no valid notices were served to Mrs. Krishna, and proper quorum was not maintained.
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The Supreme Court set aside NCLAT’s ruling and restored the NCLT order in favor of Mrs. Krishna.
- Mrs. Krishna remains the lawful owner of 39,500 shares.
- She is reinstated as Executive Director of Satori Global Limited.
- The respondents must return her share certificates.
“All actions of the company collectively show oppression and mismanagement. Probity was lacking, which prejudiced the appellant,” the Court concluded.
Case: Mrs. Shailja Krishna vs. Satori Global Limited & Ors.
Case Type: Civil Appeal Nos. 6377-6378 of 2023
Date of Judgment: September 2, 2025
