Friday, November 25 2005 15:06 Hrs (IST) - World Time -

Mumbai: The Bombay High court today (Nov 25,2005) put on hold the demerger scheme of Reliance Industries Ltd (RIL), seeking approval for changes in the shareholding pattern as settlement between Ambani siblings Mukesh and Anil, after a shareholder objected to the proposal saying it was lacking in some aspects.

Hearing the objection raised by Ahmedabad-based chartered accountant, Kalpesh Bharatkumar Mankad, Justice Nishita Mhatre asked him to file a detailed reply in an affidavit and adjourned the matter till December two.

The share-holder pointed out to the court that he had raised the objections in the Extraordinary General meeting (EGM) of the company on October 21, but was not convinced with the company's reply to him.

However, the court asked Mankad to file affidavit on his objections by November 28.

Raising the objection, Mankad said the scheme of arrangement proposed by the company lacked many aspects.

Since, the company has failed to provide copy of the scheme of demerger before 21 days of the EGM to every share holder, he said the meeting held on October 21 be annulled and a fresh meeting of the shareholders be called with modified scheme and after giving at least 30 days notice.

Mankad also said that the proposed demerger scheme be held in abeyance until the action taken report of corporate governance issues raised by RIL's Ex-VC and MD Anil Ambani is put before the high court and scrutinized by Sebi and Department of Company Affairs (DCA).

Mankad contended that the scheme of arrangement proposed to RIL shareholders was completely devoid of requisite details, which are considered essential to afford the shareholders fair chance to arrive at the assessment of their present and future holding in the demerged company and demerged undertaking.

He also said that even though huge assets worth Rs 19119.54 crore were being demerged, the description given in the schedules does not specify the specific assets and liabilities to be transferred and hence the proposal was incomplete and vague.

It also gives unfair advantage in the hands of the management to make adjustments and tamper the list according to their wish, the shareholder said adding the company may be directed to come out with new scheme giving full disclosures and also the required material facts of the properties with their valuation.