NEW DELHI: In the ongoing spat between the promoters of Indigo, Rahul Bhatia-led InterGlobe Enterprises (IGE) may have the upper hand over Rakesh Gangwal as IGE is in the driver’s seat in running the airline, says a legal expert.
“Being a listed entity, IndiGo is expected to have proper checks and balances on related party transactions, one of the prime reasons for the spat.
The fact that IGE, according to the terms of the contract, operates the airline and the fact that the airline is running well makes IGE’s case strong,” said Mukesh Jain, well-known corporate counsel and founder of Mukesh Jain & Associates.
He, however, added that the decision taken by promoters to go public with their differences would hurt the firm’s valuation.
“If one of the promoters is worried about misgovernance, he could have approached NCLT to fix the issues rather than go public. the tribunal is authorised to step in and hear his allegations. The best they can do now is sit and resolve their issues,” Jain said.
When asked about the consequences if allegations made by Gangwal against Bhatia were found to be true, Jain said there were enough provisions in the Companies Act to punish errant companies.