The Hindu : Front Page : CLB moved to sack Maytas boards

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Wednesday, Feb 18, 2009
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CLB moved to sack Maytas boards

Special Correspondent

NEW DELHI: The government on Tuesday moved the Company Law Board (CLB) to supersede the boards of Maytas Infra and Maytas Properties, both promoted by the family of the former chairman of Satyam Computer Services, B. Ramalinga Raju.

Briefing journalists here, Corporate Affairs Minister Prem Chand Gupta said: “In order to prevent further acts of fraud against the said companies [two Maytas firms] and to safeguard the operations of these companies in the public interest, the government has moved the CLB to remove the existing directors.”

Pending the petition, slated to come up for hearing on February 24, the CLB was requested to “nominate government directors on the boards of each company.”

It was also requested to bar the board members of Maytas Infra and Maytas Properties from becoming directors in any other company, Mr. Gupta said.

The government prayed to the CLB that it immediately restrain all existing directors from “alienating, mortgaging, creating charges or liens or interest in the properties, assets owned and/or controlled by them without the leave of CLB.”

The move to sack the directors of the Maytas firms has come a day after the government handed over the Satyam fraud case to the Central Bureau of Investigation on the recommendation of the Andhra Pradesh government.

Explaining the need for such action on the lines of what was done in the Satyam case, Mr. Gupta said the CLB was moved because of a “strong possibility of the affairs of Maytas Infra and Maytas Properties having been conducted by its present management with fraudulent intent, causing breach of trust to stakeholders of the company.”

The Minister said the boards were persistently negligent in discharging their functions and this was proving detrimental to the business and operations of the two companies.

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