The Mumbai bench of the National Company Law Tribunal (NCLT) on Wednesday allowed Dish TV time till November 15 to file its response in a petition filed by Yes Bank, the company’s largest shareholder.
Yes Bank had sought NCLT’s direction to the company’s board to call for an extraordinary general meeting (EGM) of the shareholders to vote on the removal of MD & CEO Jawahar Goel and four other directors.
In May last year, Yes Bank invoked promoters’ pledged shares in Dish TV to own 25.63% stake in the DTH company.
On September 3rd, the bank sent a requisition notice to the company’s board to convene a special meeting of the shareholders to reconstitute the board and sought the removal of Goel from the company and induction of seven new directors.
Goel is the brother of Subhash Chandra, founder promoter of the erstwhile Essel Group.
Chandra’s Zee Entertainment Enterprises is currently fighting a similar takeover battle in the NCLT and the Bombay high court against its largest shareholder Invesco.
Meanwhile, after Dish TV board declined the requisition for EGM, Yes Bank moved to the tribunal seeking a special shareholders meeting.
Appearing for Dish TV, senior counsel Navroz Seervai sought time to file the reply in the matter, stating that the company wanted to respond on “merit, jurisdiction and maintainability”.
Referring to the Bombay high court order in the ZEE Vs Invesco matter, he said, “Yesterday, in a similar matter the Bombay High Court has passed an order. We also want to put that on record. The order clarified that NCLT has no jurisdiction to entertain this kind of plea.”
The bench, headed by Suchitra Kanuparthi and Anuradha Bhatia allowed Dish TV time till November 15 to file its response in the matter and has posted the case for further hearing to November 23.
Senior counsels Darius Khambata and JP Sen, representing Yes Bank in the case, also sought time to file their rejoinder to the Dish TV reply.
The tribunal also allowed the lender to file a response to Dish TV’s reply before the next date of hearing.
The private lender has sought tribunal’s intervention to direct the company to either provide shareholder details – so it can call the meeting on its own – or instruct it to set a date for an EGM.
“Owing to YBL (Yes Bank) being a banking company and its shareholding in the Company (Dish TV) being a consequence of invocation of pledges, there are certain embargos under the provisions of the Banking Regulation Act, 1949 read with Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, because of which the said resolutions cannot be placed before the shareholders,” said Dish TV in its exchange filing on October 13, at the time of rejecting the requisition request of the bank.
ET, in its September 24 report stated that the dispute between Goel and Yes Bank over corporate governance and fund-raising plans was escalating and was reaching the courts.
The bank wants to dissolve the entire board and removal of the promoter family, as it believes that the board is functioning in cahoots with the minority shareholders (that is the promoters), who should not have representation on the board.
Dish TV, which has been trying to raise funds since some time, had decided to go ahead with a Rs 1,000 crore rights issue to be able to invest for acquiring new customers, in set-top-boxes (STBs) and on marketing and promotions.
