NEW DELHI: The holding company of the Rs. 38,100-crore Murugappa Group, Ambadi Investments Limited (AIL), has filed around ten applications in the last few months against an application moved by Valli Arunachalam and her family before the National Company Law Tribunal (NCLT) Chennai — seeking waiver of the minimum shareholding requirement of 10 per cent for maintaining the alleged oppression and mismanagement case against AIL and also its family members.
These applications can be divided into three sets: (i) Rejection of waiver application; (ii) Application for furnishing the register of stamps and notaries register and, (iii) enlargement of time.
Senior Counsel P S Raman, who appeared for Arunachalam, submitted that “these applications are delaying tactics by the respondents to keep petitioners out of the shareholding.”
On the other hand, the counsel for Murugappa Group family members, Aryama Sundaram, said their applications need to be heard first, prior to listening to the waiver matter. They have also argued that the date of affidavit and the date of stamp paper for verification were different. Raman, however, submitted that there was “no error” in the waiver application under the Notaries Act since notary rules have been relaxed during the pandemic. "Now if the tribunal finds an error, the same can be rectified by filing fresh stamp paper as required. But, these applications are merely dilatory tactics.”
The main allegation of Arunachalam, the eldest daughter of Murugappa Group patriarch late MV Murugappan, is that there has been a history of gender discrimination in the Murugappa Group. “There is serious oppression and mismanagement on part of the respondents that aims to suppress minority shareholders and keep petitioners away on ground of gender discrimination,” Raman said.
The waiver petition, which was filed on March 10, said that the family owns 8.21 per cent in Ambadi and falls short of the minimum requirement as per section 244 of the Companies Act, 2013, by 1.79 per cent. They want that condition to be waived to seek legal remedy against such alleged oppression. Raman also referred to the National Company Law Appellate Tribunal, New Delhi, giving waiver to certain firms of Cyrus Mistry from the minimum requirement for maintaining a case against Tata Sons. Incidentally, none of the family members hold more than 10 per cent of the total shareholding where all identifiable branches of the family have position on the board and active participation in the affairs of AIL, except the applicant’s family.
The petition also seeks a board representation or alternatively a fair buyout of their stake as per section 242 (2b) of the Companies Act 2013. Arunachalam family’s plea for equal representation in the company’s affairs has been denied since her father’s demise a few years back, she had said. On September 21, 2020, AIL’s shareholders, largely uncles and cousins of Valli Arunachalam, voted against her appointment to the board. Only 8.64 per cent voted in favour of the resolution.
The NCLT has posted the matter for further hearing on August 9.