The development came after the Supreme Court ordered disclosure of the results of the vote on the resolution during the annual general meeting (AGM) held on September 29 which the company had withheld.
Prakash Chhabria-led Orbit Electricals, one of the promoters of Finolex Cables, had taken the matter to the Supreme Court, contesting the non-disclosure.
A Supreme Court bench led by Chief Justice DY Chandrachud on Friday ordered scrutiniser VM Birajdar to disclose the results immediately and said the National Company Law Appellate Tribunal (NCLAT) can pronounce the judgement later.
“We are prima facie of the view that the mandate of the order cannot be defeated by deferring the declaration of the result till a judgment is rendered by NCLAT… The NCLAT shall proceed to declare its judgment in the pending appeal after it is duly apprised of the fact that the result of the AGM has been declared,” the top court ordered.
Finolex Cables informed the stock exchanges that about 72.34% of the total investors had voted against the resolution, while 27.66% supported it. Significantly, 93.21% of the promoters opposed Chhabria’s reappointment. In contrast, 64.38% of institutional investors favoured the resolution.
Besides challenging the decision by Finolex Cables to withhold the voting results of its 55th AGM, Orbit Electricals had also filed a contempt petition against the scrutiniser on the grounds that he had intentionally and deliberately breached the apex court’s order of September 26 in relation to the resolution pertaining to the reappointment of Chhabria by withholding the outcome of the voting.
Deepak Chhabria and his cousin Prakash Chhabria are engaged in a struggle to gain control of Finolex Cables.
Meanwhile, on Friday evening, the Supreme Court asked NCLAT chairman Justice (retd) Ashok Bhushan to conduct an enquiry and file a report by Monday 5 pm on whether its bench defied the apex court’s orders by pronouncing the judgment at 2 pm, before the AGM results were declared at 2.40 pm.
Finolex Cables’ scrutiniser, in a disclosure to the stock exchange in the first week of October, revealed that in the light of the Supreme Court’s directive, the voting results were kept abeyance until the NCLAT passed its final orders.
On September 26, the Supreme Court vacated the NCLAT’s interim direction and allowed Orbit Electricals, led by Prakash Chhabria, to vote at the Finolex Cables AGM. However, in its order, the Supreme Court said that any action taken on the proposed resolution pertaining to the appointment of the executive chairperson will be subject to the outcome of the NCLAT order.
According to the BSE data, Orbit Electricals holds a 30.7% stake in Finolex Cables. Prakash Chhabria, son of late Prahlad Chhabria, founder of the Pune-based Finolex Group, also holds 20% in Finolex Cables through Finolex Industries and direct stakes in Finolex Cables individually and through family members.
Deepak Chhabria serves as Finolex Cables’ executive chairman.
Prakash Chhabria owns about 78% of Orbit Electricals, while KP Chhabria faction (father of Deepak Chhabria) along with his children owns about 7%.
