Appointment of Government nominee directors

‘The Company had invited deposits from the public but was unable to repay the matured deposits. Many complaints were made by the depositors to the company law board. The Company Law Board took cognizance of matter and formulated  a scheme and directed the company to pay to the depositors accordingly.

The company however, failed to adhere to the scheme Thereafter the Central Government filed a petition under section 408, read with 397 and 398. It was observed that the company had  made huge  investments in its associate companies. Also the company made provisions for its debtors without giving any logical reasoning and had even written off the debts. The amount of debtors also was wrongly represented by the company. The Company had made other violations and the books of accounts of the company were not maintained properly. The Central Government prayed for six government directors being appointed in the company. The CLB after considering the entire case partly allowed the central government application and ordered two central government directors be appointed to monitor and assist the company for a period of 3 years.

Morepen Laboratories Ltd. v. Union of India [2008] 83 SCL 204 (HP)

%d bloggers like this:
Verified by MonsterInsights

Disclaimer

 

Chamber of Prakash K. Pandya

Advocate, Mediator and Insolvency Professional

The Bar Council of India does not permit advertisement or solicitation by advocates in any form or manner. By accessing this website, http://www.pkpandya.com, you acknowledge and confirm that you are seeking information relating to/from Chamber of Prakash K. Pandya of your own accord and that there has been no form of solicitation, advertisement or inducement by Chamber of Prakash K. Pandya or its members and associates. The content of this website is for informational purposes only and should not be interpreted as soliciting or advertisement.

The visit to this website implies your willing consent, acceptance and agreement to our terms of services including our privacy policy and cookie policy.