New Delhi: The Chennai bench of the the Company Law Board (CLB) reinstated N. Murali as managing director of Kasturi and Sons Ltd, but declined to interfere with new appointments made, including one as managing director, or implement a retirement age for family members on the company’s board, and instead asked the board itself to meet and discuss these issues.
CLB’s ruling was in response to a plea by Murali, 64, and his younger brother N. Ravi, 62, and targeted at their third brother N. Ram, 65, the editor-in-chief of The Hindu, The Hindu Business Line, and magazines Frontline and Sportstar.
Murali was stripped of his powers on 20 March by the board of Kasturi and Sons led by Ram. “I feel vindicated, but it is not a matter for celebration because in the first place such a fight should never have happened,” said Murali.
Ram declined to comment on the specifics of the CLB order.
The order is just another chapter in an ongoing family dispute in the fourth generation of the Kasturi family that controls Kasturi and Sons, one of India’s oldest and most respected media companies.
The 30-page order by judge Lizamma Augustine did not grant Murali and Ravi’s main plea of implementing a proposed permanent editorial policy that includes retirement rules for family members and editorial succession.
Murali had informally proposed a retirement age of 65 at a board meeting in September 2009 and claims that N. Ram had agreed to it. This meant that Ram would have retired on 4 May 2010, making way for N. Ravi and later Malini Parthasarathy, his cousin, to take the top editorial post at the national daily.
Ravi currently holds the title of editor and Parthasarathy is the executive editor of the paper. CLB’s order states that the retirement policy “can at best be termed only as an informal understanding among the members of the family” and therefore it was not legally enforceable.
The CLB also declined to implement a permanent corporate governance policy, which included the codification of editorial values. This was a draft proposal made by Murali and Ravi in February this year, which Ram and others declined to accept along with the retirement proposal. The CLB also held that K. Balaji, who was appointed in place of Murali, will continue as a managing director.
Balaji declined to comment and said that Ram would respond on his behalf.
Ram said the group would pull through the tussle that has plagued the company for over a year with most of the drama having unfolded in the press. “We have strength in our 132-year-old newspaper and in our public limited company to deal with opportunities and problems as and when they arise. We respect all courts, including the Company Law Board,” he said over the phone from Chennai.
“The institution is bigger than all the family members put together. It is akin to a public trust,” said Murali.
Ram clarified that Balaji would continue to perform his duties as managing director. The CLB order also notes that there was an understanding between the board members that Murali would retire from the day-to-day affairs of the company in August 2011, when he turns 65.
The 12-member board of Kasturi and Sons meets on a monthly basis, usually between the 20th and the 23rd. December’s meeting was on Monday.
Ram has chaired all board meetings since the demise of the company’s former chairman S. Rangarajan in February 2007.
Mint competes with The Hindu Business Line.