Court lifts freeze on Bajaj board meetings

The Bombay high court has lifted the Company Law Board's indefinite stay on all board meetings of Bajaj group holding companies.  
 
Thursday's high court order would pave the way for the Bajaj group holding companies Bajaj Sevashram and Jamnalal Sons to convene board meetings soon after the next Company Law Board hearing scheduled for May-end is over, sources said. 
 
The Bajaj family, which had begun discussions on a split in 2002, had run into additional problems over group ownership that ranged Shishir Bajaj and his son Kushagra against Shishir's brother and group patriarch Rahul Bajaj and his cousins Shekhar, Madhur and Neeraj (see chart). 
 
The board meetings of Bajaj Sevashram and Jamnalal Sons are expected to discuss board representation of the Rahul Bajaj faction in both companies that control shares in all Bajaj group companies. 
 
"The holding companies realised that the Company Law Board stay on board meetings had wider ramifications. The Company Law Board stayed the board meetings indefinitely so the holding companies approached the Bombay High Court to vacate the stay," sources said. 
 
Significantly, Shishir Bajaj agreed in the high court to convene a board meeting, thus indicating that both sides are willing to find a solution to the ownership issues. 
 
On March 13, the Company Law Board had stayed the board meetings of Bajaj Sevashram and Jamnalal Sons, which hold all the assets of the Bajaj group following a plea from the Shishir faction. However, the Company Law Board's blanket ban brought the operations of both holding companies to a standstill. 
 
The Shishir camp had, in fact, sought a ban on the induction of two representatives of the Rahul Bajaj faction in the five-member board of Bajaj Sevashram and one in the four-member

Jamnalal Sons board. 
 
The board composition of these two investment companies is important because the Bajaj family members had earlier agreed to split their group but the split process has not yet been implemented. 
 
A Bajaj family source said on Friday, the family ownership issues would not be decided by the courts anyway. "We are not in any hurry but the earlier this issue gets out of our way, the better for all the parties concerned," sources said.  
 
Family Matters
  
* 2002: Discussions begin on splitting the Bajaj group 
 
* March 2003: Shishir Bajaj group files petition with CLB which asks the family to resolve the issue, orders status quo  

* June 2003: S Gurumurthy and D S Mehta chalk out the split formula; memorandum signed  
 
* Sept 2006: Rahul Bajaj's lawyers claim that an oral pact was reached that deviated from the original agreement; Shishir Bajaj denies it  
 
* March 6, 2007: Jamnalal Bajaj Sons proposes induction of Sanjiv Bajaj as an additional director; calls board meeting on March 14  
 
* March 7, 2007: Bajaj Sevashram proposes induction of Sanjiv and Niraj as additional directors; calls board meeting on March 13  
 
* March 12, 2007: CLB stays board meetings  
 
* March 12, 2007: High court lifts CLB stay