Bombay High Court allows Yes Bank to attend DishTV EGM

A division bench of Bombay High Court on Thursday held that Yes Bank, a shareholder of the DishTV company can attend the meeting Extra-ordinary General Meeting of DishTV scheduled to be held on June 24. .A bench of Justices GS Patel and Madhav Jamdar upheld the order of the single-judge who had refused to restrain the bank from attending the EGM.The Court was hearing a plea by the promoter of DishTV, World Crest Advisors LLP.“In our view, on the equitable considerations, apart from the lakh of a prima facie case, and on the questions of balance of convenience and irretrievable prejudice, World Crest has made out no case whatsoever. We find it impossible to fault the decision of the learned Single Judge. He correctly refused to exercise the discretion vested in him. So do we”, the order reads..World Crest had approached High Court seeking an order declaring them as owners of the 440 million shares of DishTV.A converse claim by Yes Bank was that those shares had been pledged in favour of Catalyst Trusteeship, a security trustee, by five other companies to secure the term loans granted by the bank to them.Yes Bank publicly claimed to be the beneficial owner of the shares and sought to exercise all rights in respect of the shares.However, World Crest alleged that Yes Banks's claim of being the largest shareholder of DishTV was based on a fraudulent transaction..Meanwhile, DishTV announced in May this year that it was holding an EGM for ratifying and passing a resolution for re-appointment of the managing director, the whole time director and a non-executive independent director of DishTV.World Crest moved the High Court for an order restraining Catalyst and the bank from exercising voting rights in respect of the shares under challenge in the suit at the upcoming EGM, which was rejected by the High Court last week.The single-judge had held that since World Crest had withdrawn an earlier interim application, it could not seek the same reliefs again. .In its appeal before the division bench, World Crest pointed out that this observation by the judge was erroneous as the application had been disposed off as infructuous, because the cause of action had changed. The new cause of action was brought on record by a subsequent application which came to be rejected by the single-judge. World Crest prayed that the single judge order was contrary to the principles laid out by the Supreme Court in the PTC India case, which enunciated the pledgee's rights.Yes Bank on the other hand argued that the Bank held the shares with it, by virtue of a loan taken by certain other promoters, for which Catalyst was a security trustee. Because the loan could not be repaid, the shares came to be transferred with the bank, it was contended. .[Read order]