Supreme Court allows Yes Bank plea but refuses stay on HC proceedings

Mumbai: Yes Bank Ltd on Tuesday approached the Supreme Court challenging an order by a two-judge bench of the Bombay high court on the maintainability of a suit filed by Madhu Kapur, the widow of Yes Bank co-founder Ashok Kapur.

The Supreme Court admitted the bank’s plea and has scheduled a hearing in January 2015, Yes Bank said in an emailed statement on Tuesday.

But the court declined to stay the ongoing proceedings in the Bombay high court.

“Yes Bank had filed a statement before the court to demonstrate that the valuation of the shares held by the Late Mr. Ashok Kapur’s family has increased manifolds and the original investment of Rs.52 crores today has increased to Rs.2,450 crores. The Hon’ble Supreme Court has found merit in the contention of Yes Bank and has listed the matter in January, 2015 to examine it in further detail,” the bank said in an emailed statement.

Yes Bank was represented by senior counsels Kapil Sibal, Abhishek Singhvi and Soli Cooper in the apex court.

The next hearing of the case in the Bombay high court is on 23 July.

Madhu Kapur and her family took Rana Kapoor and Yes Bank to court in June 2013, demanding the right to nominate a director to the bank’s board, citing the articles of association of the bank.

Shagun Kapur Gogia, the daughter of Madhu Kapur, declined to comment on the development.

Yes Bank’s contention has been that since the directors of the bank were elected by shareholders and under section 10 A (6) of the Banking Regulation Act, the court had no jurisdiction to hear the plea —which was struck down first by a single judge and then by a two-judge bench.

On 9 May, the two-judge bench of the Bombay high court said that it had jurisdiction to hear the case.

Madhu Kapur holds an 11.91% stake in the bank, while Rana Kapoor, directly and through other family-owned ventures, holds a 13.64% stake, according to the shareholding pattern of the bank as of 31 March.

Shares of Yes Bank rose 1.57% to close at Rs.532.15 on Tuesday on BSE, while the exchange’s benchmark Sensex gained 0.89% to 25,228.65 points and the banking index, Bankex, gained 2.76% to close at 17,053.82 points.