IMPORTANT POINT
Without any specific authority by the owner of the company shares in favour of third party, including her husband, even husband had no right to transfer shares of his wife and her acquiscence did not amount to consent unless the expressly authorised her husband to transfer her shares.

ORDER

Leave granted. We have heard learned counsel on both sides.

2. These appeals by special leave arise from the judgment of the Division Bench of the High Court of Himachal Pradesh, made on November 14, 1996 in RFA Nos. 230 and 231 of 1985.

3. The admitted position is that the respondents, Mrs. Surjeet Malhan and Mr. B.K. Malhan, wife and husband respectively, laid two suits for declaration and permanent and mandatory injunction. The learned single Judge of the High Court dismissed the suits. But on appeal, the Division Bench has decreed the suits. Thus, these appeals by special leave.

4. The first respondent, Mrs. Surjeet Malhan, held 1500 shares in total-900 in her name and 600 in the name of other relatives-and 10 preferential shares. The second respondent, B.K. Malhan, had held 2230 ordinary shares and 64 preferential shares. It would appear that there was an agreement between B.K. Malhan and Shri R.D. Bhagat, the appellant for transfer of the shares and completion of the transaction to put on rails the company which was running in losses. It would appear that as per the agreement, subsequent transactions were to be completed and in furtherance thereof, it appears that the shares, admittedly, were entrusted to Mr. Bhagat with a blank transfer form. Thereafter, the disputes arose between them. In consequence, the suits came to be laid by the respondents against the appellants.

5. The principal contention raised by Shri P.N. Lekhi, learned senior counsel for the appellant, is that Mrs. Malhan had admitted in her evidence that her husband had delivered her shares to Bhagat and that she never objected to the transfer and that, therefore, there was an implied consent for the transfer of her shares in favour of Bhagat. Equally, it is contended that when B.K. Malhan had transferred the shares, though they were not registered with the previous consent of the Board of Directors and they were not duly registered in the register maintained by the Registrar in that behalf, there was a complete transaction; the Division Bench, therefore, is not right in reversing the judgment of the single Judge. We find no force in the contentions.

6. There should be consensus ad idem for a concluded contract and it is seen that Section 25(1) of the Contract Act contemplates that when a transfer is without consideration, it is a void contract. It is an admitted position that there is no concluded contract between Smt. Surjeet and Bhagat. The acquiescence did not amount to consent unless Smt. Surjeet Malhan expressly authorised her husband to transfer her shares. The transfer as contemplated in this case is only for a sum of Re. 1/-. As a consequence, in the eye of law, there is no consideration and, therefore, the transfer agreement is void. The question then is : whether the wife had consented to the transfer ? It is an admitted position that she had not given authority by any letter in writing or otherwise to her husband to transfer her shares in favour of Mr. Bhagat. Shri Lekhi sought to rely upon a judgment of this Court in Vasudev Ramchandra Shelat v. Pranlal Jayanand Thakar & Ors.1 in which the Privy Council judgment rendered in M.P. Barucha v. W. Sarabhai & Co.2 was approved of. He contended that once the shares with blank transfer forms were entrusted, the contract is complete and, therefore, there is a concluded contract between Bhagat and the respondents. We find no force in the contention. The transaction was between the broker and the purchaser. After the broker purchased the shares on behalf of the company with blank transfer forms, the shares were entrusted. It was, therefore, concluded that the moment the shares were entrusted, being movable property, the contract was complete and, therefore, it was a valid transfer. In this case, there was no direct transaction between Mrs. Surjeet Malhan and Mr. Bhagat. It is not even the case of the appellant that Mr. Malhan had been authorised to entrust those shares and blank transfer forms to B