238. Registration of offer of schemes involving transfer of shares
(1) In relation to every offer of a scheme or contract involving the transfer of
shares or any class of shares in the transferor company to the transferee company under
section 235,—
(a) every circular containing such offer and recommendation to the members
of the transferor company by its directors to accept such offer shall be accompanied
by such information and in such manner as may be prescribed;
(b) every such offer shall contain a statement by or on behalf of the transferee
company, disclosing the steps it has taken to ensure that necessary cash will be
available; and
(c) every such circular shall be presented to the Registrar for registration and
no such circular shall be issued until it is so registered:
Provided that the Registrar may refuse, for reasons to be recorded in writing, to
register any such circular which does not contain the information required to be given
under clause (a) or which sets out such information in a manner likely to give a false
impression, and communicate such refusal to the parties within thirty days of the application.
(2) An appeal shall lie to the Tribunal against an order of the Registrar refusing to
register any circular under sub-section (1).
(3) The director who issues a circular which has not been presented for registration
and registered under clause (c) of sub-section (1), shall be punishable with fine which
shall not be less than twenty-five thousand rupees but which may extend to five lakh
rupees.