Bombay High Court rejects plea by DishTV promoter seeking interim relief against Yes Bank in dispute over shares

The Bombay High Court on Friday rejected the plea filed by promoter of DishTV India Pvt. Ltd., seeking to restrain Yes Bank, a shareholder of DishTV from exercising its right over shares held by the bank..Single-judge Justice AK Menon on Friday rejected the interim application for urgent relief filed by World Crest Advisors LLP, the promoter, in its suit against DishTV and Yes Bank..World Crest had approched 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.It even claimed to be the largest shareholder of DishTV based on a fraudulent transaction, World Crest’s application pointed out..Meanwhile, DishTV announced in May this year that it was holding an extra-ordinary general meeting (EGM) on June 24 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 urgent reliefs apprehending that the bank will seek to vote on the suit shares over which only the former had entitlement rights.World Crest sought 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 today..Justice Menon rejected the interim application filed in World Crest’s suit. The claim in the suit was that it was World Crest who had provided security for the financial facilities which were extended from the bank to the companies.The allegation was that Catalyst acted in collusion with the bank and transferred the shares to itself and thereafter to the bank.The contention was that since the shares are pledged to them, they could continue to hold the shares, till the loan amount was repaid as per the Indian Contract Act.The suit is still pending and will be heard in due course..[Read order]