Gandhinagar, Oct 7 (IANS) The Gujarat High Court has dismissed a petition filed by the family members of an employee of a company seeking allotment of shares that she was entitled to before her death.
‘Legal heirs or family members of the deceased employee of IPCL (Indian Petrochemicals Corporation Limited) were not entitled for the shares as claimed by them,’ a division bench comprising Chief Justice S.J. Mukhopadhaya and Justice Anant Dave ruled in an order made available Thursday.
The scheme stipulated that the shares were to be transferred to the employees and not to the family members as inheritance, the court said.
The court said no right accrued, acquired or much less crystallized in favour of legal heirs or the family members of the deceased employee, Kokilaben Pathak, June 4, 2002 – the cut off date on which an employee had to be on the rolls of the IPCL to be eligible for allotment of shares under a scheme announced in 2004.
Kokilaben was working in the IPCL as on June 4, 2002 but died Oct 26, 2003, about six months before the scheme was announced April 29, 2004.
As per the case details, before the disinvestment of the IPCL, which is now part of Reliance Industries Ltd, the government of India introduced a scheme April 29, 2004 offering transfer or allocation of 1,24,10,240 equity shares of the face value of Rs.10 each of the IPCL to its employees.
The government decided to allocate, or transfer, the legal or beneficial ownership up to 5 percent in aggregate of the paid up share capital of the company to the employees of the IPCL.
The scheme was available to the employees on conditions that the employee should be alive at the time of making application and such employee should have been on the rolls of the IPCL as on June 4, 2002 before the transfer of management control to the strategic partner.
To avail the benefits of the scheme, legal heirs of Pathak made a representation to the company seeking allocation of 1,350 shares in their names. Their representation was rejected by the authorities, which was challenged in the high court.
The court said: ‘If the scheme is closely perused, the criteria for eligibility would make it clear that only those employees who were on the rolls of the IPCL and alive as on June 4, 2002 were eligible for such allocation or transfer of shares.’
‘Therefore, as on June 4, 2002, Pathak, the deceased employee, was on the muster roll but not alive (when the scheme was announced),’ the court said.
‘Besides, as per the scheme which was offered by the government of India it had the sole discretion to determine the mode and manner for the transfer,’ said the court.
