The Company Bench in the High Court Division admitted a company dispute filed by an investor to officially recognize his majority ownership in a private limited company in Bangladesh, by rectification of share register and ordered status quo regarding shareholding position.
What Happened?
Back in 2021, the original founders of a private limited company needed BDT 4.00 Crore to pay the required registration fee and security deposit to the Dhaka Stock Exchange (DSE) for a brokerage (TREC) license. Unable to raise the money themselves, they approached the investor for investment.
In good faith, he agreed to fund the full BDT 4.00 Crore directly to the DSE in exchange for 3,00,000 shares giving him a 60% controlling stake in the company. The founders signed the necessary share transfer documents (Form 117s) and handed them over.
The Dispute:
Despite receiving the full funding and signing the transfer forms, the original founders never officially registered the investor’s name as a shareholder with the Registrar of Joint Stock Companies and Firms (RJSC).
Over the next few years, the company fell into severe management delays, failing to submit required government filings and leading to the suspension of its brokerage license by the DSE. When the investor stepped in to clean up the regulatory backlog and protect his BDT 3.00 Crore security deposit, the original founders turned on him denying that any share transfer had ever taken place and filing criminal charges against him.
The High Court’s Action:
With his name wrongfully left off the official list of owners, the owner petitioned the High Court Division under Section 43 of the Companies Act, 1994, which allows the court to correct official company ownership records.
After hearing the arguments of the lawyer on behalf of the petitioner, the High Court formally accepted the lawsuit for trial and issued a status quo order. This legal freeze ensures that the founders cannot sell, alter, or dilute any shares in the private limited company while the court determines the final ownership.
Managing Partner Asif Bin Anwar of Avon Chambers and Senior Associate Kristi Keya Saha handled the matter on behalf of the investor.