K.M.MADHUSOODANAN Vs. RESERVE BANK OF INDIA

JUDGEMENT

(1.) Heard the learned Senior Counsel for the petitioners in the writ petitions and the learned counsel for the common respondents 2 and 3 in the writ petitions on the prayer for interim order.

(2.) Parties and documents are referred to in this order, unless otherwise mentioned, as they appear in W.P.(C) No.19758 of 2021.

(3.) The matters relate to the affairs of M/s Dhanlaxmi Bank Ltd. (the Bank), a listed private sector banking company incorporated under the Companies Act, 1956. The first petitioner is a shareholder of the Bank. It is stated that the Nomination and Remuneration Committee (the NRC) of the Bank constituted in terms of Section 178 of the Companies Act, 2013 (the Act), after conducting due diligence, has recommended to the Board of Directors of the Bank (the Board) to appoint petitioners 2 and 3 as the Directors of the Bank. It is the case of the petitioners that once the NRC of the Bank makes a recommendation, it is obligatory on the part of the Board to place the recommendation before the General Meeting of the Bank for appropriate decision. It is stated that since the Board has not acted upon the recommendation of the NRC to appoint petitioners 2 and 3 as Directors, they have given notice under Section 160 of the Act signifying their candidature as Directors of the Bank. The first petitioner also, in the meanwhile, gave notice under Section 160 of the Act signifying his candidature as a Director of the Bank. It is stated that it is obligatory on the part of the Board to place the notice given by the petitioners in the General Meeting of the Bank in terms of Section 160 of the Act. It is alleged by the petitioners that the Annual General Meeting of the Bank is scheduled to take place on 29.09.2021 and the petitioners are now informed that the Board has decided on 20.09.2021 not to place the notices issued by the petitioners under Section 160 of the Act in the ensuing Annual General Meeting of the bank or any adjournment thereof. Ext.P3 is the communication issued by the Secretary to the Board of the Bank to the first petitioner. The petitioners, in the circumstances, seek, among others, directions to respondents 2, 3 and 8 to place the notices issued by them under Section 160 of the Act, signifying their candidature as Directors of the Bank in the ensuing Annual General Meeting as provided for under Section 160 of the Act.