NCLT directs Singh brothers to maintain status quo in RHC Holding

The National Company Law Tribunal (NCLT) today directed founders of Fortis Healthcare, Malvinder and Shivinder Singh to “maintain status-quo” with respect to the stakes and management of RHC Holding.

“Without prejudice to the rights of the Respondents..status quo be maintained with respect to the Board of Directors and shareholding.”, the Tribunal ordered.

RHC Holding, which is the holding company of Fortis Healthcare, is jointly owned by the two brothers.

A two-member Bench of NCLT headed by MM Kumar passed the interim order while hearing a petition filed by the younger brother Shivinder Singh against elder brother Malvinder Singh, former Managing Director of Religare Sunil Godhwani and others under Section 241, 242, 244 of the Companies Act, 2013.

Shivinder has moved the Tribunal against “various acts of oppression and mismanagement” perpetrated by Malvidner Singh, which ultimately resulted in depletion of Petitioner’s wealth along with an “unwarranted loss of reputation & credibility”.

He has not only sought for a direction reconstituting the Board of Directors of RHC Holding in exclusion of Malvinder or his representative but also wants the elder brother and Godhwani to restitute and restore the wealth of RHC Holding “which got eroded due to their unlawful actions“.

Meanwhile, the Bench also allowed Shivinder and other petitioners i.e. his wife Aditi Singh and Shivi Holdings to examine the records of RHC Holding, either himself or through an authorized Chartered Accountant or Company Secretary.

“Parties may be permitted to take photocopies (of the document) in accordance with law”, the Tribunal further said.

While issuing notice to all the Respondents in the suit, including Malvinder, Godhwani, RHC Holdings, Religare Enterprises and Fortis Healthcare, the Tribunal directed them to file their reply within 10 days.

Filed through Advocate Ranjana Roy Gawai, the Petition claims that Malvinder and Godhwani acted against the interest of creditors and shareholders of Shivinder owned-Shivi Holdings by putting it in an “unsustainable debt trap”.

It is also claimed that due to actions of Malvinder and “the consequent undermining of reputation” of Shivinder and RHC Holding, the latter was “unable to achieve any meaningful progress with the investors for sale of stake of RHC in Fortis Healthcare Limited or Religare Enterprises Limited by end of the year 2017”.

Interestingly, the Petitioner also seems to have passed the buck with respect to the Ranbaxy-Daiichi Sankyo fiasco to Malvinder and Godhwani, stating that the deal was carried out by the two in 2008.

Shivinder Singh was represented by Senior Advocate UK Chaudhary.

Advocate Jayant Mehta appeared for Malvinder Singh.

The matter would be next heard on October 9.