One of the promoters of Haldia Petrochemicals Ltd- The Chatterjee Group (TCG), is likely to legally challenge last month’s appointment of Sumantra Chowdhury, as HPL’s managing director. A two-judge division bench of the Calcutta high court on Friday has upheld the validity of the joint venture agreement between TCG and the West Bengal government, as per livemint.com. The agreement gives TCG the right to appoint the managing director, but the state government, which currently controls HPL, appointed its nominee as the firm’s chief executive through a boardroom coup. This occurred on 19 June, when the state got former Coal India Ltd chairman Partha S. Bhattacharyya to resign as the managing director and replaced him immediately with Chowdhury.
TCG chief and HPL’s vice-chairman Purnendu Chatterjee vehemently opposed this appointment and walked out of the board meeting when he failed to convince the state government that Bhattacharyya should not be allowed to leave immediately. He was required to serve a three-month notice under a contract of employment. The state government named Chowdhury as Bhattacharyya’s successor and introduced him to the board after Chatterjee left the meeting.
Supported by Friday’s division bench judgement, which says both the state government and TCG have “sufficient protections” under agreements between them and HPL’s constitution (articles and memorandum of association), Chatterjee is likely to challenge Chowdhury’s appointment as the managing director.
After TCG’s allegations of mismanagement of HPL and oppression of minority shareholders under the state’s control were dismissed as “not maintainable” by the Supreme Court in a verdict delivered on 30 September last year, the state government was advised by its lawyers that all agreements between the firm’s two co-promoters, including the principal joint venture agreement, ceased to be in force. |
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