CENTRAL GOVERNMENT Vs. RICHIMEN SILKS LTD

JUDGEMENT

(1.) THE Central Government has made a reference to the Company Law Board, under Section 408 of the Companies Act, 1956 ("the Act") for appointing majority of directors on the board of M/s. Richimen Silks Ltd. ("the company"), in order to safeguard the interests of the company, its shareholders and the public interest, on the following among other grounds:

(2.) The respondents in response to the prayer of the Central Government for appointing majority of directors on the board, submitted as under:

(3.) IN view of my foregoing conclusions and in exercise of the power under Section 408 of the Act and in public interest. I deem it fit that the Central Government must be authorised to appoint two directors on the board of directors of the company for a maximum period of two years from the day they assume charge, who will along with the existing directors take all corrective steps, thereby removing the prejudices suffered by the company and its shareholders.