Don't go ahead with amendments to articles of association, SC to Byju's arm
This story was originally published at 16:16 IST on 29 November 2024
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NEW DELHI – The Supreme Court on Friday asked Aakash Educational Services Ltd., owned by Byju's, not to go ahead with the resolution to amend its article of association until the next hearing of the case in the National Company Law Appellate Tribunal.
The Supreme Court was hearing a petition by two minority shareholders of Aakash Educational Services against the Karnataka High Court ruling, staying an order of the Bengaluru bench of the National Company Law Tribunal barring Aakash Educational Services from amending the article of association.
The apex court noted that Aakash Educational Services and its shareholder Manipal Health Systems Pvt. Ltd. will file an appeal in the National Company Law Appellate Tribunal, within seven days. Once the appeal is filed, the case will be taken on board and the first hearing will be held as soon as possible, the apex court said.
The minority shareholders of Aakash Educational Services – Singapore VII Topco I Pte. Ltd. and BCP Asia Athena ESC (Cayman) Ltd. – said they received a notice for an extraordinary general meeting of the company scheduled for Nov. 20. One of the agenda for the meeting was to amend the articles of association of Aakash Educational Services to grant additional rights to Manipal Health Systems while deleting the Part B in its entirety, the petitioners said. Part B granted several rights to minority shareholders, including a right to appoint a director on the board of Aakash Educational Services, pre-emptive rights and information rights, the petitioners said.
In addition to deleting the petitioners’ rights, extensive rights were being conferred on Manipal Health Systems, the two minority shareholders said.
The minority shareholders said that the amendment of Aakash Educational Services's articles of association was a "reserved matter" and the company was obligated to issue a "reserved matter notice" to them. The notice for the meeting was issued in contravention of the articles of association as no prior written approval of the petitioners was obtained, the two minority shareholders said. Having failed to procure their prior written approval, Aakash Educational Services was restricted from taking any action or commitment on the reserved matter, the petitioners said. End
Reported by Surya Tripathi
Edited by Saji George Titus
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