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The hearing over the right of the promoters’ family to be consulted on the appointment of directors on the Yes Bank board is scheduled to be held on Friday in the Bombay High Court.
The hearing was postponed on Monday after the counsel of Madhu Kapur — widow of the bank’s co-founder, Ashok Kapur — sought time to reply to an affidavit filed by Yes Bank.
The case pertains to the Madhu Kapur camp saying that her family has been denied its right to jointly appoint three directors on the bank’s board as provided for in the bank’s Articles of Association.
In its affidavit on Monday, Yes Bank informed the Court that the right to recommend directors is limited to the two founding members — Rana Kapoor and Ashok Kapur. It further stated that the right given to the successors to appoint directors might lead to disagreements among them over the nomination of directors.
In its board meeting on June 27, the bank had rejected the nomination of Shagun Gogia, daughter of Ashok Kapur, as an independent director. The court had asked the bank to consider her nomination as a director on the board.
To drag longer
Notwithstanding the rejection, the case is set to drag longer with Madhu Kapur’s counsel filing amendments to their original suit after studying the affidavit filed by Yes Bank.
“We are just limiting our suit to what the articles of association say. We want to agree on the process of the articles of association. It states that the two Indian partners can jointly nominate three people to the board,” a close associate of the Kapurs said, requesting anonymity.
“Our opposition to the Annual General Meeting held on June 8 was because there was a one-sided nomination of the three directors by Rana Kapoor,” the source said. “We also proposed to Rana Kapoor that you nominate one director and we will nominate one director and the third director we can nominate by rotation. Even that is not agreeable to them.”
“The present suit is misconceived and untenable for the reason that it seeks to challenge the appointment of the directors, who have been duly elected by the company at the Annual General Meeting held on June 8,” Yes Bank said in its affidavit.
satyanarayan.iyer@thehindu.co.in
beena.parmar@thehindu.co.in
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