The National Company Law Tribunal (NCLT) today declined a plea by India Horizon Fund for an interim stay over Religare Enterprises’ movement to invest up to Rs 500 crore in its arm Religare Capital Markets.
The tribunal also noted that there was “deliberate suppression of material facts” out of it by IDBI Trusteeship Services Ltd, a consenting party in the suit, which has already approached the Bombay High Court on the same issue.
“Having heard the counsel for the parties on the grant of interim relief, we are of the considered view that no interim relief could be granted at this stage,” said a two-member tribunal bench headed by Chairman Justice M M Kumar.
Institutional investor, India Horizon Fund Together with IDBI Trusteeship Services, had transferred NCLT seeking a stay over the proposal by Religare Enterprises to invest in Religare Capital Markets for repaying debt related to Mauritius business and capital needs of Indian business.
The NCLT found that IDBI Trusteeship Services Ltd had made no disclosure to it on the suit before the Bombay High Court, where it had been declined interim relief to the same.
“Moreover, in this stage, the locus standi of the petitioner, if it is left alone without the consenting party (IDBI) would be only 5.59 per cent and for that reason, there would be valid doubt for its locus standi,” the tribunal added.
The sections mandate that only parties or individuals who have more than 10 per cent stake in a company can appeal at the NCLT.
“In view of the above, we decline to exercise our equitable discretion of granting some interim relief,” that the tribunal added.
The petitioners, however, have claimed to satisfy the criteria together with the approval letter of IDBI.
The NCLT has directed Religare Enterprises to file its reply within four weeks and any rejoinder by the parties in a couple of weeks and has fixed next date of hearing on November 8, 2017.
“Let the answer be filed within four weeks with a copy in advance to the learned counsel for the petitioner.
Religare Enterprises’ shareholders have given their consent to an ordinary resolution through postal ballot, the company said today in a regulatory filing.
As per the voting response, 55.63 percent shareholders voted in favour of the proposal while the remaining 44.37 percent were against it.
The voting result also showed that 99.95 per cent of total votes cast by public institutional shareholders were against the resolution. Promoters did not participate in the voting.
However, 99.03 per cent of the public non-institution shareholders who participated in the voting were in favour of this proposal.
The voting was closed on September 9.
In the postal ballot notice issued in July, Religare Enterprises had said it proposed to make additional capital investment of up to Rs 500 crore in Religare Capital Markets (RCML).
“The SBLC facility is falling because of repayment. Since RCML and RCMIML are in losses and have negative cash flows, they need support from the holding company, which is Religare Enterprises Ltd,” the July 26 notice said.
Religare Enterprises said it will use part of selling proceeds from divestment of its health insurance business to make investment in RCML.