CLB’s new chairman to join ahead of schedule

CLB’s new chairman to join ahead of schedule
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First Published: Wed, Nov 25 2009. 11 59 PM IST

Filling gaps: Corporate affairs minister Salman Khursheed says the Centre is also looking to fill the seven vacant positions on the board. PTI
Filling gaps: Corporate affairs minister Salman Khursheed says the Centre is also looking to fill the seven vacant positions on the board. PTI
Updated: Wed, Nov 25 2009. 11 59 PM IST
A day after the acting chairman was arrested for accepting a bribe, the ministry of corporate affairs brought forward the date when the new chairman is to join and is also looking to fill seven of the nine positions on the board that are vacant.
The Company Law Board, or CLB, will have a new chairman from 27 November, said Salman Khursheed, minister for corporate affairs. CLB is a quasi judicial body that looks into disputes, arising within and between companies, in the larger interest of shareholders. “Although CLB’s new chairman was to join from 1 December circumstances have led to his joining before that. He (Dilip Rao Saheb Deshmukh) will join the CLB day after tomorrow (27 November),” said Khursheed. Deshmukh is a retired judge from the Chhattisgarh high court.
Filling gaps: Corporate affairs minister Salman Khursheed says the Centre is also looking to fill the seven vacant positions on the board. PTI
Khursheed also said while the law will take its own course in deciding the fate of R. Vasudevan, member and acting chairman of CLB, the ministry does not think there is need for it to revisit cases handled by Vasudevan in the past, including that of the fraud at Satyam Computer Services Ltd. “Various cases including that of Satyam has been handled by a group of people, including the SFIO (Serious Fraud Investigation Office) and not just Vasudevan, so I believe that cases have been handled with efficiency,” said Khursheed.
On 7 January, Satyam’s founder confessed to having fudged the company’s books, over the years, to the tune of at least Rs7,136 crore. On Tuesday, the Central Bureau of Investigation disclosed that the amount involved was actually higher.
CBI on Tuesday arrested Vasudevan for allegedly accepting Rs7 lakh in bribe from a Kolkata-based company secretary in a case between shareholders of Amar Ujala (it still isn’t clear to whom the company secretary, Manoj Banthia, reported). Since then Vasudevan and Banthia have been remanded to police custody. Besides Vasudevan and Bhanthia, CBI also registered a case against advocate Ankur Chawla and a few others for criminal conspiracy and various sections of the Prevention of Corruption Act, the federal investigation agency said on Tuesday.
Vasudevan, who was director, investigation and inspection, ministry of corporate affairs, or MCA, before joining CLB three months ago, was in charge of several high-profile cases, including Satyam and that of Sesa Goa, where he has been looking into allegations of financial mismanagement. Now, the SFIO has initiated an inquiry into the mining company, which was acquired by Vedanta Plc in 2007.
The arrest, Khursheed said, “consolidates credibility that there is nobody above the law...if you work on the wrong side of the law you will definitely have to bear the brunt...”
According to an MCA official who did not want to be identified, there are over 2,800 cases pending before the CLB. “Of these over 700 are serious cases relating to mismanagement in companies, added the official.
S. Balasubramaniam, the former chairperson of CLB, retired in October and Vasudevan was presiding over the body in the interim. For sometime now, CLB has been looking at filling vacant positions. While the provision is to have nine members (including a chairperson), currently there are just two members, besides Vasudevan.
“The ministry is filling up the posts soon. In three-to-four weeks CLB is likely to have seven members,” said Balasubramanian. CLB is part of MCA.
Although CLB is a quasi-judicial body, the members and chairman need not be from a judicial background. Balasubramanian, for instance, is from the Indian Postal Service.
A senior advocate said that the position of a CLB member is a very responsible one and it is unfortunate that something like this kind has happened.
Jayant Bhushan, senior counsel at the Delhi high court said: “It is a major offence and the (acting) chairman can be prosecuted on various charges like criminal offence and also under Prevention of Corruption Act.”
Manish Ranjan of Mint and PTI contributed to this story.
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First Published: Wed, Nov 25 2009. 11 59 PM IST