Hyderabad HC intervenes in mother, daughters tiff at biological E limited

Hyderabad: The Hyderabad High Court has constituted an Adhoc Board to run the affairs of the Hyderabad based vaccine maker Biological E. Limited. While disposing off company appeals and applications by Ms Renuka Datla, the wife of late Vijay Kumar Datla, and her three daughters, Justice C.V. Nagarjuna Reddy observed that “With the demise of its mentor, the closely-held family company, namely, Biological E. Limited has plunged into the vortex of legal litigation. Pitted against each other are the mother on the one side and the three daughters on the other side.”

The judge said “with the war beginning and the battle lines drawn, the mother and daughters sentiment has vanished. With the one up-man-ship getting better of the family relationship and vanity having the last laugh over mutual affections, the successors in interest of the departed soul, have arraigned themselves before the law Courts.” After hearing the pleas, the judge felt that instead of appointing an outsider as the administrator, keeping in view the interests of the company, it was better to constitute an adhoc board with the mother and her three daughters.

The judge ruled that the Ms Renuka shall discharge the functions of the managing director of the company and her three daughters will remain as directors’ of the board and the adhoc board is responsible for the day-to-day functioning of the company and shall carry out the statutory obligations under the Act.

The judge said all the decisions shall be taken by the board based on unanimity and consensus. If consensus on any aspect relating to the day to day affairs of the company is eluded among the board members, the MD shall approach the Company Law Board for appropriate directions.

The judge ruled that the Board shall not transfer or deal with 81 per cent shares held by late Vijay Kumar Datla in any manner till the dispute on the issue of succession is adjudicated and the board shall not take any major policy decisions unless there is unanimity among all its members and without the prior approval of the Company Law Board.