Update: An Astro (AENL) spokesperson told MediaNama, “Whilst the Board meeting was scheduled for Sept 30th, it could not take place as many of the directors were unavailable to attend. A petition is being raised with the court with a request for a change of date.”
Earlier today: The Company Law Tribunal Board gave a green signal (pdf) to Getit Infoservices to hold a board meeting on the 30th of September in the Sanjiv Gupta Vs Getit Infoservices case. MediaNama was unable to verify if a board meeting took place on Friday or what the agenda/discussion for the meeting was, despite attempts to do so. The application was filed by petitioner former Getit MD Sanjiv Gupta against the company, Astro (the majority shareholder), Sidharth Gupta (co-founder and director of Getit) and Ramesh Gupta (founder and chairman of Getit) who are respondents 1, 2, 3 and 4 respectively, according to Sanjiv Gupta’s lawyer Vipul Ghanda.
Multiple attempts to reach Sanjiv Gupta were in vain, and Ghanda declined to speak with MediaNama about the details of the hearing. Likewise, Sandeep Vats said he would not be a in position to comment, while Prakash Mishra could not be reached. Both Vats and Mishra were appointed as additional directors on the board of Getit Infoservices on 16 June 2016.
We’ve written to Astro for a comment and will update this if we hear from the company. Note that Astro also said that it would conduct a forensic audit of Getit last month.
Getit had sought permission for a board meeting
For the current hearing, Getit’s lawyers sought permission to hold a board meeting from the Company Law Tribunal, saying that the company was facing “huge and crippling financial crises and has not been able to pay third parties, creditors, vendors and employees.” They added that Getit had been compelled to cease operations due to lack of funds. This, the Getit lawyers argued, was because Sanjiv Gupta, who held only 0.06% shares in the company had resigned as the managing director on 12 August 2016, leading to the resignations of several other managers including the company secretary and the chief technology officer (Rahul Chitale).
To this, Sanjiv Gupta’s lawyers stated that he was forced to resign. They added that company affairs were being conducted according to Getit’s directions and its holding company Astro Overseas Ltd. Gupta’s lawyer said that the “creditors and employees of Getit have been dealing with it on the basis of false assurances given by Astro.” They also said that Gupta had conveyed these assurances to creditors and employees as per Astro’s directions and that Getit “may be directed to provide details of utilization of transactions amounting to Rs 41 crores($6.17 million) by Getit.”
Gupta’s lawyers also argued that “Getit has been making several attempts to frustrate the cause agitated by Sanjiv Gupta.” They refer to a letter from Getit dated 25 August 2016, filing of Form DIR 12 on 29 August 2016 in which the “proposed board meeting has been convened to legitimise the various illegal and oppressive actions of Sidharth Gupta.” They also said that the agenda (for the board meeting) did not contain any specific proposal of reviving the business, and that Getit’s company affairs were being conducted as per the “directions and control of Astro”. Gupta’s lawyers alleged that the creditors and employees of Getit have been dealing with it “on the basis of false assurances given by Astro.”
The original case, which is due for a hearing on 17th of October, was filed by Sanjiv Gupta on 30th August, alleging that additional directors Sandeep Vats and Prakash Mishra’s appointments on 16 June 2016 be deemed illegal and their interference in day to day functioning of the company be banned. At the time, the court said that it was unable to accept Gupta’s plea “because the petitioner has only 0.06% shareholding, and the shareholders having 99% shareholding in the company cannot be allowed to overawe at the instance of the petitioner.” It also said that the board constitution should remain status quo.