Shareholders of Kirloskar Brothers Ltd have rejected a forensic audit of the company’s operations by an outside agency, according to a regulatory filing on Monday.
On December 8, at the request of Kirloskar Industries Ltd (KIL), at the request of Atul Kirloskar and Rahul Kirloskar, who together own a 24.92% stake in Kirloskar Brothers Ltd (KBL), the company’s extraordinary shareholders’ meeting was held. convened. Killoskar Brothers.
The ordinary resolution was rejected by 63.99% against and 36.01% in favor.
The resolution calls for the appointment of an independent forensic auditor to conduct a forensic audit, which must examine and verify the legal and professional consultancy fees KBL has incurred in the past six years, as well as the company’s operations. was.
It also sought an investigation to review all company records, books of accounts, minutes and other documents, as well as to investigate the actions of the board of directors, including independent directors.
KBL’s Board of Directors has advised shareholders to initiate legal proceedings to protect the interests of the company. He advised that the resolution should be rejected.
The Kirloskar brothers, with KBL Chairman and Managing Director Sanjay Kirloskar on one side and Atul and Rahul on the other, have been feuding since 2016 over a family settlement deed to the assets of the Kirloskar Group, which has a history of more than 130 years. increase. .
Rahul Kirloskar is Chairman of Kirloskar Pneumatic Co Ltd and Atul Kirloskar is Chairman of Kirloskar Oil Engines Ltd.
In October, Kirloskar Industries Ltd (KIL), along with Atul and Rahul Kirloskar, called for an extraordinary shareholders’ meeting of KBL and called for an external forensic audit of KBL’s operations.
They allege that KBL, a listed company, has spent a huge amount of money totaling around Rs 274 crore on illegal expert fees and consulting fees since the dispute broke out in 2016. He demanded that reasons and grounds must be justified.
After being cleared of insider trading charges by the Securities Appeals Court (SAT), Rahul and Atul raised questions about KBL’s corporate governance. In 2010, when he sold his shares in KBL to KIL, they were accused of insider trading.
They had accused KBL of “misusing the resources of listed company shareholders and abusing the regulatory machinery” in a personal dispute with Chairman and Managing Director Sanjay Kirloskar.
KIL has requested in its audit that it should investigate the conduct of the KBL board, particularly the independent directors, as to whether they “verified the allegations made by Sanjay Kirloskar in relation to the Family Settlement Deed (DFS).” I was. They are not misled by the latter claim.
In its rebuttal, KBL said its legal fees over the past seven years amounted to around Rs. It is an expert’s fee paid to a consultant.”