Source: Inhouse illustration
Source: Inhouse illustration

Yes bank-Dish TV row: SC stays criminal proceedings to freeze voting rights

One-liner: The Supreme Court on Tuesday stayed the criminal proceedings in the FIR lodged by Essel Group against the Yes Bank saying it cannot allow the police sitting in Gautam Buddha Nagar in Uttar Pradesh to freeze voting rights of shareholders of a company.

Bench action: The bench also stayed the operation of two notices issued by Gautam Buddha Nagar police to the stock exchange and the National Securities Depository Limited (NSDL) asking it to not allow any transfer of shares of Essel group held by the bank.

  • The bench said that it cannot allow this kind of act of police to happen in the country and that is why Article 226 of the constitution is a very valuable right under which the HC can interfere in these kinds of cases
  • The top court said  it can't allow short-circuiting the judicial process by getting orders from police officers 

Hearing an appeal: The top court was hearing an appeal filed by the bank against the Nov 25 order of Allahabad High Court refusing to quash the notices under section 102  of the Criminal Procedure Code (CrPC)  and FIR lodged by the police.

Scuttling voting rights: During the hearing, senior advocate AM Singhvi, appearing for Yes Bank said, this is one of the most extraordinary cases where mala fide criminal proceedings are initiated to scuttle the voting rights of the largest shareholder of the Essel Group.

  • Senior advocate Kapil Sibal, appearing for Essel Group's Subhash Chandra, the original complainant, said that this case is not what is presented and he can show that the shares which are with the banks are tainted
  • Sibal said for 18 months they have not sold the shares and are sitting over it. The bank wants to take over the company. What business does the bank have to take over the company? 

No AGM: Sibal asked the court to record his statement that he will not hold the Annual General Meeting (AGM) and if he is able to prove that the shares are tainted, then the police have every right to go after them.

AGM deferred: Singhvi intervened and said that the AGM, which was scheduled for Tuesday, was deferred because Yes Bank had mentioned before the CJI bench on Monday.

Source: PTI