The National Company Law Appellate Tribunal (NCLAT) has directed Vadilal Enterprises and Vadilal International to maintain the current structure of their boards until further notice, amid an ongoing family dispute over control of the companies. The interim order, issued by a two-member NCLAT bench, aims to prevent any changes ahead of the final hearing scheduled for September 26, 2024.
The family feud involves members of the Vadilal Gandhi family—Virendra Ramchandra Gandhi (VRG), Rajesh Ramchandra Gandhi (RRG), and Devanshu Laxmanbhai Gandhi (DLG). The NCLAT noted that any alterations to the board, such as the removal of a director or appointment of a new one, could complicate the matter further.
The tribunal is reviewing an appeal filed by Rajesh R. Gandhi, who challenged a July 2024 ruling by the Ahmedabad bench of the National Company Law Tribunal (NCLT). The NCLT had declared a board resolution authorizing the retirement of Virendra R. Gandhi from Vadilal Enterprises and Vadilal International as “null and void” and directed the division of family businesses among the three factions of the Gandhi family.
Rajesh R. Gandhi’s legal counsel, Abhishek Manu Singhvi, argued that under a prior agreement from October 2020, Gandhi was to remain on the board as Managing Director until 2025, and efforts to remove him were in violation of this agreement. Singhvi raised concerns over a recent board meeting where an agenda was circulated for appointing Virendra Gandhi as Managing Director, a move that could alter the basis of the appeal.
The NCLAT emphasized that its August 6, 2024, order to maintain the status quo should be followed until the final hearing later this week.