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Thursday, August 22, 2013

Bombay High Court to decide on jurisdiction of YES Bank case

The Bombay High Court will continue its hearing on Thursday to decide if it has the jurisdiction to hear the suit filed by Madhu Kapur against YES Bank.

YES Bank, in its argument on Wednesday, said the court must first determine if it has the jurisdiction in the matter before it hears the case. The private sector lender has argued that appointment of directors by the bank’s board cannot be questioned in a court of law.

It further said the appointment of directors was “duly” held as mandated by the Banking Regulations Act.

Also, the YES Bank counsel argued that the court cannot have part jurisdiction in some matters pertaining to the case.

“The suit will have to be addressed by the court in its entirety,” the senior counsel arguing on behalf of YES Bank said.

The Madhu Kapur camp has so far maintained that the appointment of six directors on the YES Bank board was not “duly” held as per the Banking Regulations Act. Madhu Kapur, widow of the bank’s co-promoter Ashok Kapur, holds 11.71 per cent stake in the bank.

Shares of the Mumbai-based bank have fallen by almost 50 per cent since the beginning of the legal battle between the families of the two promoters since June. However, analysts tracking YES Bank have said that not all of the fall can be attributed to the legal battle.

Source: thehindubusinessline


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