Govt moves CLB to sack boards of two Maytas companies

NEW DELHI: A day after handing over Satyam probe to CBI, the government today moved Company Law Board (CLB) to supercede the boards of Maytas Infra
Maytas Properties, the two firms promoted by the kin of disgraced promoter of Satyam Computer B Ramalinga Raju. "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," Corporate Affairs Minister Prem Chand Gupta told reporters this evening. The government, he said, has also requested the CLB to bar the existing board members of the two companies from becoming directors in any other company. In addition, Gupta said, the government is also seeking to restrain the present directors 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 boards of each company".
The government has already handed over the probe of the Rs 7,800-crore Satyam fraud case to the Central Bureau of Investigation (CBI). The government, Gupta said, has prayed to CLB to immediately restrain all the current 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". According to a filing by Maytas Infra in the Bombay Stock Exchange, B Narasimha Rao has been appointed the additional director with effect from January 30.
The other directors, according to the company website, are R P Raju and B Teja Raju. The government, Gupta said, has moved CLB as there is 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 stake holders of the company". The Minister added there was a persistent negligence by the boards in discharging the functions, which was proving detrimental to the business and operations of the companies.
Also ReadFollowing disclosure of fraud by former Satyam Chairman Raju, the government ordered probe by Serious Fraud Investigation Office in Satyam Computer and related companies including Maytas Infra and Maytas Properties. Before disclosure of fraud, Satyam wanted to acquire Maytas Infra and Maytas Properties for USD 1.6 billion, but the deal was aborted following protest by some shareholders.