The NCLT will continue to hear the case on Tuesday as power outage disrupted the proceedings on Monday.
Invesco Developing Markets Funds on Monday reiterated its demand before the Mumbai bench of the National Company Law Tribunal that Zee Entertainment Enterprises (ZEEL) should convene an extraordinary general meeting (EGM), which should be chaired by a retired high court judge.
“Our apprehension of ZEEL board not calling an EGM has come true. We are not concerned with the outcome of the EGM, but only concerned that an EGM should be called,” Invesco’s counsel Mukul Rohatgi told the bench.
The Companies Act empowers shareholders holding at least 10% of voting rights to convene an EGM, in case the company is not willing to do so.
However, Invesco’s counsel said that it cannot call an EGM, as there were more than 2.5 lakh retail shareholders in the company and ZEEL was not providing their details (contact and mailing details). “Hence, NCLT should give a mandatory order to ZEEL to call an EGM,” Rohatgi said. The EGM should also be chaired by a retired high court judge, Rohatgi added.
The NCLT will continue to hear the case on Tuesday as power outage disrupted the proceedings on Monday. On Invesco’s earlier demand to appoint six independent directors, Rohatgi said these members will not take up any duties until the board gets approvals from the ministry of information and broadcasting (MIB).
Invesco had moved the NCLT last week, after its September 11 requisition for EGM was not heeded to by ZEEL. On its part, ZEEL on Saturday moved the Bombay High Court urging it to declare Invesco’s EGM requisition as “illegal”.
Janak Dwarkadas, also a counsel for Invesco, argued that ZEEL’s board meeting on October 1 was just a “legal formality” as it had earlier taken legal advice on the EGM requisition. This is a classic case of “forum shopping”, Dwarkadas added.
Senior advocate Navroz Seervai, who appeared for ZEEL, said the Indian media firm will be opposing the petition filed before NCLT on grounds of “jurisdiction and maintainability”. However, he did not elaborate.
Earlier, in its September 11 requisition letter, Invesco had sought convening an EGM to remove chief executive officer and managing director Punit Goenka and non-executive directors Ashok Kurien and Manish Chokhani, alleging breach of corporate governance norms.
Invesco (formerly Invesco Oppenheimer Developing Markets Fund) — which together with its subsidiary OFI Global China Fund holds a 17.88% stake in ZEEL — had also sought induction of its six nominees on the Indian firm’s board.