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Govt moves CLB to sack Maytas boards

In yet another blow to the credibility of the Satyam group of companies,the government today moved the Company Law Board...

Written by ENS Economic Bureau | New Delhi | Published: February 18, 2009 12:18 am

In yet another blow to the credibility of the Satyam group of companies,the government today moved the Company Law Board (CLB) to supersede the existing boards of Maytas Infra and Maytas Properties,on the concern that their management may have been involved in fraudulent practices.

“The government finds a strong possibility of the affairs of Maytas Infra and Maytas Properties having been conducted by its present management with fraudulent intent,breach of trust to the stakeholders of the company,persistent neglect of the obligations and functions to be discharged by the board,” said corporate affairs minister Premchand Gupta,addressing the media here today. “In order to prevent further acts of fraud against the said companies (two Maytas companies) and to safeguard operations of these companies in public interest,the government has moved the CLB to remove the existing directors of these companies,” he added.

The government has also requested the CLB to bar the existing board members of the two companies from becoming directors in any other company.

To protect the interests of the company and its stakeholders,Gupta added that the government is also seeking to restrain the present directors of the two companies from disposing of properties. Pending the petition,which will come up for hearing on February 24,he said,CLB has been requested to “nominate government directors on the boards of each company”. Replying to supplementaries in the Question Hour in the Rajya Sabha today,Gupta had said that the government had yesterday handed over the probe of the Rs 7,800-crore Satyam fraud case to the Central Bureau of Investigation (CBI).

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