Restores powers of then managing director.
The Company Law Board (CLB) has set aside the decision in March this year of the board of directors of Kasturi & Sons, publishers of The Hindu, the leading English news daily here, to remove the powers of N Murali, the then managing director (MD), and to reallocate his powers to the other directors.
The March move had been proposed by N Ram, publisher and editor-in-chief of The Hindu group of publications, and supported by eight other directors. Murali was redesignated Senior MD, while K Balaji was made MD. A list of the reallocated duties of the directors was prominently published on the front page of The Hindu.
The order, passed yesterday by tribunal member Lizamma Augustine, stated this move of the Board, without notice and an opportunity to be heard, was an oppressive act, lacked probity and good faith, and was vindictive.
As a result of this order, Murali will function with supervisory powers over all departments of the company, as he had done prior to March 20.
“I hereby set aside the decision taken by the Board on March 20, 2010, to the extent it reallocates the functions of the Senior Managing Director and direct the position prior to March 20, 2010, shall be restored as far as allocation of departments concerning the second petitioner (Murali) is concerned,” says the order.
And: “This will not affect the continuation of Balaji as Managing Director and his functions can be appropriately determined by the Board, without affecting the position and status of the Murali as Senior Managing Director,” says the order.
On the retirement and succession framework in the company, specifically the issue of retirement of N Ram as Editor-in-Chief when he had turned 65 on May 4 this year, the CLB has declined to go into what was said to be an informal agreement. However, it has directed the board of directors and the shareholders to decide on the issue of succession and corporate governance without much delay.
CLB also declined to pass any orders on the appointments of Vidya Ram, daughter of N Ram, as the London correspondent of The Hindu Business Line and of Narayan Lakshman, son of Nirmala Lakshman, one of the Directors, as Washington Correspondent of The Hindu.
The CLB said these issues had become infructuous.