In an unexpected turn of events in the Ranbaxy-Fortis saga, Shivinder Singh has filed a case against his elder brother Malvinder and former Religare CEO Sunil Godhwani in the National Company Law Tribunal for oppression and mismanagement of RHC holdings, Fortis and Religare.
Shivinder also alleged that collective and ongoing actions of his elder brother and Godhwani led to a systemic undermining of the interests of companies and their shareholders.
JN Gupta, former ED at SEBI, Sandeep Parekh, founder of Finsec Law Advisors, and Brian Hines, fFormer member at RSSB discuss how will the feud between the Singh brothers play out in the future and would it further dent the image of Fortis which is already facing a lot of adversities.
Sandeep Parekh: In legal parlance, we call it a noisy withdrawal. You are kind of disassociating yourself from a company. Shivinder has been, at least he calls himself a non-executive chairman of Fortis. I do not think he can disassociate himself from all the dealings of that company.
“Being the promoter family of this company, I think it will be very hard for Shivinder to convince the court of law that he was not responsible for any of the wrongdoings. All the joint statements till very recently will all be held against him. I think it is going to be a tough sell.” Parekh said.
JN Gupta: Shivinder cannot absolve the responsibility because he was knowing very clearly that there are financial dealing between the company and RSSB. The moment you involve religion in to the business, what type of business you are running.
I am a religious Hindu, you may be a religious Hindu, but that does not mean that I will take shareholders fund into my faith. You have given up your fiduciary responsibility, you have failed in your fiduciary responsibility because you were put in the board to safeguard the interest of the company and shareholders, and you cannot be using shareholders money to propagate your belief in religion.