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A shareholder and two others have approached the court against the board’s decision of rejecting their candidature for the office of director, to be placed before members during the annual general meeting scheduled for September 29.

Problems seem to be never ending for Dhanlaxmi Bank, with major shareholders, including NRI Ravi Pillai, engaging in conflict with the board of directors.

A shareholder and two others have approached the court against the board’s decision of rejecting their candidature for the office of director, to be placed before members during the annual general meeting scheduled for September 29.

KN Madhusoodan, a shareholder of the company, P Mohanan and Prakash D L have approached the court seeking a direction to the respondents – RBI and Dhanlaxmi bank – to discharge their statutory responsibilities under Section 160 of the Companies Act to inform the members about the candidature of the petitioners for the office of the director as mandated under Section 160(2) of the Companies Act.

The board of the bank arbitrarily rejected the applications of all five candidates, including prominent shareholder Ravi Pillai ( B Ravindran Pillai) and former independent director PK Vijayakumar, filed under Section 160 of the Companies Act, a highly-placed source told FE.

The petitioners had to move their candidature under Section 160 of the Companies Act after the board decided to defer their candidatures.

“The action of the board has no basis in law as the names of P Mohanan and Prakash were previously cleared by the Nomination and Remuneration Committee during its meeting held on July 23, 2021,” sources said.

“It is a truncated board and they want to keep it that way to have a controlling stake. There are only 8 directors, including 2 RBI nominees, and it helps them to take unilateral decisions against shareholders’ interests,”sources added.

Ravi Pillai holds a 10% stake in the lender and was on the board till May 2020. He had to exit on turning 70. Later, the RBI raised the age limit for non-executive directors, including the chair, to 75. CK Gopinathan and his two family members together hold close to 10% in the bank. NRI MA Yussuffali and Kapil Wadhawan own a 5% stake.

CS Rajan, managing director of IL& FS, hailed the move and said under Kotak’s continued leadership, IL&FS will accomplish the resolution targets.

The government has extended the term of Kotak Mahindra Bank managing director Uday Kotak as the non-executive chairman of the IL&FS group by six months through April 2, 2022.

In a gazette notification, the Department of Financial Services said: “…whereas the Central government, on the recommendations of the Reserve Bank of India, has considered it necessary to grant said exemption to Kotak Mahindra Bank Limited for a further period of six months with effect from the 3rd day of October, 2021.”

According to the Banking Regulation Act, a bank cannot be managed by any person who is a director of any other company. He can be granted a temporary exception for three months or nine months with the approval of the RBI.

The Centre had appointed Kotak as the head of the lender’s board in 2018 to help the debt-laden firm come out of stress, after the government took over the board. He was initially allowed to be at the helm of IL&FS for three months, which was extended by nine months. Subsequently, he got two extensions of one year each.

CS Rajan, managing director of IL& FS, hailed the move and said under Kotak’s continued leadership, IL&FS will accomplish the resolution targets.

In fact, following the Evergrande crisis in China, Kotak had tweeted on September 21 that the trouble at the property developer seems like China’s Lehman moment and reminds him of IL&FS.

He tweeted: “Indian Government acted swiftly. Provided calm to financial markets. The Government appointed board estimates 61% recovery at IL&FS.”

CS Rajan, managing director of IL& FS, hailed the move and said under Kotak’s continued leadership, IL&FS will accomplish the resolution targets.

The government has extended the term of Kotak Mahindra Bank managing director Uday Kotak as the non-executive chairman of the IL&FS group by six months through April 2, 2022.

In a gazette notification, the Department of Financial Services said: “…whereas the Central government, on the recommendations of the Reserve Bank of India, has considered it necessary to grant said exemption to Kotak Mahindra Bank Limited for a further period of six months with effect from the 3rd day of October, 2021.”

According to the Banking Regulation Act, a bank cannot be managed by any person who is a director of any other company. He can be granted a temporary exception for three months or nine months with the approval of the RBI.

The Centre had appointed Kotak as the head of the lender’s board in 2018 to help the debt-laden firm come out of stress, after the government took over the board. He was initially allowed to be at the helm of IL&FS for three months, which was extended by nine months. Subsequently, he got two extensions of one year each.

CS Rajan, managing director of IL& FS, hailed the move and said under Kotak’s continued leadership, IL&FS will accomplish the resolution targets.

In fact, following the Evergrande crisis in China, Kotak had tweeted on September 21 that the trouble at the property developer seems like China’s Lehman moment and reminds him of IL&FS.

He tweeted: “Indian Government acted swiftly. Provided calm to financial markets. The Government appointed board estimates 61% recovery at IL&FS.”