The order of the Company Law Board (CLB) directing the West Bengal Industrial Corporation (WBIDC) to transfer its 1.55 million shares in Haldia Petrochemical Ltd (HPL) to the Chatterjee Group lead by Purnendu Chatterjee was criticised by the Counsel of WBIDC before Mr Justice Jayanta Kumar Biswas of the Calcutta High Court today.
In his argument, the WBIDC counsel described the CLB order as a classic one, because there was no such prayer for transfer of shares before the CLB. The Chatterjee Group made an application before CLB under Section 397 of the Companies Act, under which the Board passed an order directing WBIDC to transfer 1.55 million shares in HPL to the TCG. Challenging this order, both the West Bengal Government and WBIDC filed two appeals in the Calcutta High Court.
The counsel for WBIDC questioned that under Section 397, shareholders of a company can file an application of mismanagement against the company, but surprisingly in the present case no allegation of mismanagement was made against HPL by the Chatterjee Group; hence, how the application under Section 397 has been entertained by the Board, it was pointed out. WBIDC was not willing to transfer the shares, the counsel argued. The order of CLB is perverse as it appeared from the totality of fact, the counsel submitted. The hearing will continue.