A division bench of the Delhi High Court has issued notices to the Registrar of Companies (RoC) and Religare Enterprises Ltd after MB Finmart, a Burman family-owned company, filed an appeal against the Registrar of Companies’ (RoC) decision to extend Religare’s annual general meeting (AGM) by three months.
On August 22, the RoC approved Religare’s request for an extension to postpone the company’s 40th annual general meeting to December. The AGM was initially scheduled for September 30, but Religare did not give a reason for the postponement.
Read this article | Religare postpones AGM, upsetting investors
MB Finmart, in its petition filed in the Delhi High Court, alleged that the Registrar of Companies in granting the extension did not comply with Section 96(1) of the Companies Act, which allows such extension only in “exceptional circumstances”.
A bench comprising Justices Suresh Kumar Kait and Girish Kathpalia heard the case and issued notices to RoC and Religare, asking them to file their replies within 10 days. MB Finmart was asked to file its reply within five days and the next hearing is scheduled on October 21.
The main issue is the reappointment of Religare Chairman Rashmi Saluja, which will be decided at the postponed AGM. Harish Salve, a representative of MB Finmart, believes that the postponement has a negative impact on the rights of shareholders, especially in view of the ongoing tensions between the Burman family and the Religare leadership.
The Burman family holds a 21.54% stake in Religare Enterprises as of September 2023. On September 25, they announced plans to increase their holding by 5.27%, taking their total holding to over 25%, which would trigger an open offer under the Securities and Exchange Board of India’s Large Acquisition of Shares and Takeovers (SAST) Regulations. The Burmans’ open offer proposes to acquire 9 crore ordinary shares at Rs 235 per share, totaling ₹2,115 crore for 26 per cent stake in the company.
The ongoing power struggle has pitted members of the Burman family against Rashmi Saluja, who has denied the accusation and argued that the Burmans are not “fit” to control the company.
The case highlights escalating tensions between company management and major shareholders, with the High Court’s intervention adding a legal dimension to the ongoing corporate battle.
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