Preity Zinta moves court against co-directors Mohit Burman, Ness Wadia over IPL team dispute

Preity Zinta, film actress and one of the directors of KPH Dream Cricket Private Limited, has once again approached the Chandigarh court against co-directors Mohit Burman and Ness Wadia. In the suit filed before the court, she prayed to declare Extraordinary General Meeting (EGM) of the company, which took place on April 21, as illegal and invalid. She contended that the meeting was conducted by Mohit Burman with the active support of Ness Wadia in blatant contravention of, violation of, and total disregard for the provisions of the Companies Act, 2013, and Secretarial Standard on General Meetings.

She has also prayed to restrain the company, Mohit Burman, and Ness Wadia from giving effect to any resolution that may have been passed at the meeting and to restrain Muneesh Khanna from acting or holding himself out as a director of the company. Additionally, she has prayed for restraining the company and other directors from convening any further board meetings or general meetings and/or conducting any business relating to the affairs of the company without her presence and that of Karan Paul, and in the presence of Muneesh Khanna, during the pendency of the suit.

Zinta holds a 23 per cent shareholding in KPH Dream Cricket Private Limited, a private limited company incorporated under the Companies Act, 1956. The company, which owns the Punjab Kings cricket team, holds a franchise of the IPL.

In the suit, she stated that despite her objections raised via email on April 10, Burman proceeded to unlawfully convene of unlawfully convening EGM at the registered office of the company. She attended the meeting along with other directors.

At the outset of EGM, it was pointed out that no chairperson had been appointed to conduct the meeting.

Accordingly, she and another director, Karan Paul, drew the attention of Burman and Wadia to Principle 5.1 of Secretarial Standard on General Meetings, which stipulates that in the event no director has been designated as the chairperson of the Board, the directors present at the meeting shall elect one of themselves to be chairperson of the meeting. Both she and Paul suggested the appointment of Paul or, alternatively, herself as the chairperson of EGM. Their objection to the appointment of Ness Wadia as chairperson of EGM resulted in equality of votes amongst the four directors of the company attending EGM.

However, instead of declaring EGM closed without transacting any business, Burman and Wadia, in total disregard of the objections raised by the applicant and Paul, proceeded with EGM and purportedly appointed Khanna as an additional non-executive director of the company, acting illegally, unlawfully, and in contravention of the provisions of the Companies Act, Secretarial Standard on General Meetings, and the Articles.

She argued that the defendants’ illegal and unlawful conduct of EGM, in contravention of the Companies Act and Secretarial Standard on General Meetings, by usurping the powers of the chairperson and purportedly appointing Khanna as an additional non-executive director, constitutes a violation of the company’s Articles, which are binding on all directors.

The court has issued notices to the defendants for filing replies in response to the suit. Zinta had earlier moved moved the court to restrain Mohit Burman from selling, disposing of, creating any third-party rights upon his 11.5 per cent shareholding in the company.