SMT.CLAUDE-LILA PARULEKAR vs M/S.SAKAL PAPERS PVT.LTD.

The Supreme Court addressed the issue of preemption rights under Section 155 of the Companies Act, 1956, ruling that the transfer of shares by executors was invalid as it violated the appellants' undisputed right of preemption. The Court upheld the lower court's finding that the transfers were made contrary to Section 108 of the Companies Act and the company's Articles of Association, determining that the Pawar Group were not bona fide purchasers. The Court ordered the transfer of shares to be set aside conditionally upon the appellants depositing a specified amount within a stipulated time frame.