Further, BAL has also challenged the decision of the regional director of the department of company affairs (DCA) approving the change of name. The latest BAL move comes even as it is awaiting a reply from the regional director of the DCA to its letter seeking a stay on the April 5 EGM.
Bajaj Auto has decided to go ahead and file a writ petition in the Bombay High Court as time is running out in view of the April 5 EGM. It does not want to lose this opportunity. The company is prepared to look afresh into the issue depending on the response of the DCA, sources familiar with the development told FE. Bajaj Tempo Limited chairman and managing director Abhay Firodia could not be reached for comment while Bajaj Auto chairman Rahul Bajaj was unavailable for comment.
Bajaj Tempo decided to go in for the change of name after global automobile giant Daimler Chrysler which owns the Tempo name sold its stake. Further,it has taken the line that it is doing so under the governments orders. Bajaj Auto, on the other hand, has been maintaining that the Bajaj name cannot be dropped as it has an equity interest of 24% in the company. Another bone of contention is also the manner of effecting the name change.
BTL is seeking the change of name at the EGM under section 22 of the Companies Act, which means only a simple majority is required to push through the resolution and the name change would be easily effected. BAL argues that this can be done only under Section 21 of the Companies Act which means that the resolution will have to be passed by a majority of at least 75% of the shareholders.