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The Secretary of a Company issued a share certificate to ‘A’ under the Company’s seal with his own
signature and the signature of a Director forged by him. ‘A’ borrowed money from ‘B’ on the strength
of this certificate. ‘B’ wanted to realise the security and requested the company to register him as a
holder of the shares. Explain whether ‘B’ will succeed in getting the share registered in his name?
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The Secretary of a Company issued a share certificate to ‘A’ under the...
Legal Position regarding Registration of Shares
In this scenario, 'B' will not succeed in getting the shares registered in his name. The reason being:

Forgery of Director's Signature
- The share certificate issued to 'A' with the forged signature of a Director is legally void. The forgery of the Director's signature on the share certificate makes it invalid and cannot be considered as a valid document for the transfer of shares.

Voidable Contract
- The share certificate issued under false pretenses by the Secretary constitutes a voidable contract. 'A' may be entitled to rescind the contract due to the forgery of the Director's signature, which means 'B' cannot claim any legal right over these shares.

Company's Liability
- The Company may also be held liable for the actions of its Secretary in issuing a share certificate with a forged signature. The Company has a duty to ensure the authenticity of share transfers and cannot escape liability in cases of forgery.

Legal Recourse for 'B'
- 'B' may have legal recourse against the Secretary and the Company for the financial loss incurred due to the fraudulent issuance of the share certificate. 'B' can seek legal remedies for the recovery of the borrowed money.

Conclusion
In conclusion, 'B' will not succeed in getting the shares registered in his name as the share certificate issued under false pretenses is legally void. 'B' may explore legal options against the Secretary and the Company for the fraudulent actions taken.
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The Secretary of a Company issued a share certificate to ‘A’ under the Company’s seal with his ownsignature and the signature of a Director forged by him. ‘A’ borrowed money from ‘B’ on the strengthof this certificate. ‘B’ wanted to realise the security and requested the company to register him as aholder of the shares. Explain whether ‘B’ will succeed in getting the share registered in his name?
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The Secretary of a Company issued a share certificate to ‘A’ under the Company’s seal with his ownsignature and the signature of a Director forged by him. ‘A’ borrowed money from ‘B’ on the strengthof this certificate. ‘B’ wanted to realise the security and requested the company to register him as aholder of the shares. Explain whether ‘B’ will succeed in getting the share registered in his name? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about The Secretary of a Company issued a share certificate to ‘A’ under the Company’s seal with his ownsignature and the signature of a Director forged by him. ‘A’ borrowed money from ‘B’ on the strengthof this certificate. ‘B’ wanted to realise the security and requested the company to register him as aholder of the shares. Explain whether ‘B’ will succeed in getting the share registered in his name? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The Secretary of a Company issued a share certificate to ‘A’ under the Company’s seal with his ownsignature and the signature of a Director forged by him. ‘A’ borrowed money from ‘B’ on the strengthof this certificate. ‘B’ wanted to realise the security and requested the company to register him as aholder of the shares. Explain whether ‘B’ will succeed in getting the share registered in his name?.
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