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| CLB permits govt nominees on both Maytas boards |
| BS Reporter / New Delhi Mar 06, 2009, 00:15 IST |
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The Company Law Board (CLB), which was hearing two petitions from the government to supersede the boards of Maytas Properties Ltd and Maytas Infra Ltd, today allowed four government nominee-directors on the board of Maytas Infra, in addition to the existing three directors.
In the case of Maytas Properties, however, CLB permitted the government to nominate one director. Maytas Properties currently has three directors.
Immediately after the interim order was given, the Ministry of Corporate Affairs (MCA) today appointed Ved Jain, past president of the Institute of Chartered Accountants of India (ICAI), and O P Vaish, a leading corporate lawyer, as two directors on the board of Maytas Infra — a firm promoted by the elder son of B Ramalinga Raju, founder of scam-tainted Satyam Computer Services. Jain was also nominated director on the Maytas Properties board.
"The government will shortly appoint two additional directors, including the chairman," said Corporate Affairs Minister Prem Chand Gupta, while briefing the media.
The government had moved the CLB to supersede the boards of Maytas Infra and Maytas Properties — promoted by the younger son of Ramalinga Raju — to prevent mismanagement and enable transparency in their functioning, after investigations found that funds were transferred from Satyam Computer to both these firms.
The government was keen to supersede the board of both companies while arguments were on, but later filed an affidavit saying that it is agreeable to CLB's suggestion of having majority directors in Maytas Infra and at least one director in case of Maytas Properties.
According to Gupta, "The CLB order is an interim arrangement; we have sufficient control, as no decision can be taken without an affirmative vote from the government nominees. The government has the option to move CLB again, added Gupta.
In Maytas Infra, the presence of at least two government directors is essential to establish a quorum of three members. And these two directors have to give their consent for any decision taken by the board.
The government nominees will have immunity against criminal or punitive actions and all government agencies, including the banks,will have to co-operate with the board, the CLB order said.
The boards will have to submit a monthly report to both the government and CLB in the first week of every month, starting from April 1, 2009.
Also read:
February 28: Lenders decline seat on Maytas Infra board
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