UCO BANK Vs. SAUMYENDRA ROY CHAUDHURY

JUDGEMENT

(1.) The rules and regulations of UCO Bank, the appellant herein provided for representation of the share-holders on the Board of Directors of the Bank in the form of share-holder directors. The decision of the Nomination Committee rejecting the nomination of the respondent no. 1 for election to the Board of the Bank in the category of a share-holder director is the subject-matter of challenge in the suit.

(2.) The plaintiff (respondent no. 1 herein) filed an earlier suit being CS No. 159 of 2011 challenging the Bank's notice dated 6th July, 2011 to withdraw Agenda No. 3 from the Annual General Meeting that was proposed to be held on 14th July, 2011. The Agenda No. 3 was for election of a Director by the share-holders of the Bank other than the Central Government. There is a provision for such election in the acts and statutory instruments mentioned in the agenda itself. The plaintiff approached the Court with the grievance that although his nomination was validly tendered, yet, the defendant-Bank had wrongfully rejected such nomination. The public share-holding of the Bank at the relevant time was below 32 per cent. The Bank could have two Directors from amongst the share-holders. There was one Director-shareholder who was continuing. Hence, there was one vacancy to be filled up from amongst the share-holders.

(3.) The Learned Single Judge found that proper reason was not given for rejecting the said nomination and accordingly His Lordship was prima facie of the opinion that the Bank should not have withdrawn the said agenda from its Annual General Meeting held on 14th July, 2011. However, on a concession of the Bank, a direction was given to the Board of Directors to convene a fresh General Meeting to consider Agenda No. 3 of the Annual General Meeting and the Nomination Committee of the Board was given liberty to invite other nominations and also to consider them in accordance with law.