Birla Cable and Vindhya Telelinks have reinstated Lodha as the director, and Birla Corporation, together with the other companies, have already implemented a profit-linked pay package for Lodha and other directors. Results of all these resolutions could not be published earlier because of a stay from the Single Judge Bench.
While the Birlas reason that the “preservation and protection of the control of the estate of Priyamvada Devi Birla over the MP Birla Group” makes these companies part of the Probate Court proceedings, the Lodhas reason that a company cannot be made part of proceedings involving a conflict between shareholders. Several entities of the MP Birla Group are promoter shareholders in these three companies.
The issue flared up after the Birlas obtained a stay from a Single Judge Bench of the HC last year, preventing these companies to publish annual general meeting (AGM) results. On May 4 this year, the Division Bench of the court, however, allowed them to make public the AGM voting results. The Birla spokesperson said that while doing so, the Division Bench had directed the Single Judge to hear the said companies in deciding the issue of directorship of Lodha and other issues pending before it. According to the spokesperson, the order of the Division Bench was upheld by the Supreme Court with several caveats and additional protections to the Birlas.
“Most important, the SC protected Birlas by making the result of resolutions published by the said companies subject to the final decision by the Single Judge. Hence, the fate of the said resolutions and future of Lodha in these companies hangs by a thin thread,” the spokesperson said.