US EDITION
COLUMNISTS
DIARY
SPECIALS
INTERVIEWS
CAPITAL BUZZ
REDIFF POLL
DEAR REDIFF
THE STATES
YEH HAI INDIA!
ELECTIONS
ARCHIVES

Search Rediff

AP CM, family get high court notices

Shireen in Hyderabad

The Andhra Pradesh high court has issued notices to Chief Minister Nara Chandrababu Naidu, his wife Nara Bhuvaneswari, his son Nara Lokesh and others on a petition which said their Heritage Foods (India) Limited should be wound up as it violated the Companies Act.

The notices before admission were issued by Justice Krishna Sharan Srivastav on Monday on a petition filed by Rajya Sabha member and film star M Mohan Babu, one of the promoters of Heritage Foods.

The petitioner also sought interim directions to restrain N Bhuvaneswari and Dr Nagaraja Naidu from functioning as whole-time directors of the company.

Mohan Babu, formerly with the Telugu Desam Party, fell out with Chandrababu Naidu two years ago and is now an unattached member of the Rajya Sabha. He had campaigned for the Bharatiya Janata Party in the 1998 Lok Sabha elections.

In the petition, Mohan Babu claimed that he was the principal promoter of the company and contributed nearly 30 per cent to the initial share capital. He contended that Chandrababu Naidu had gained control over the company by unilaterally issuing additional shares to his family members.

Efforts were made by the chief minister to convert the company into a proprietary concern of his family. He further alleged that he was removed as director by the company through misuse of a blank paper signed by him and given to Chandrababu Naidu in good faith. The blank paper was converted into a resignation letter.

However, he had never quit as a director of the company. Mohan Babu claimed that Chandrababu Naidu got Bhuvaneswari appointed as executive director of the company on a salary of Rs 40,000 per month besides a commission of one per cent on the net profits. He said that she was also provided with other perks to the tune of Rs 240,000 per annum without the board of directors' nod.

The petitioner also sought an interim direction for the appointment of an administrator to Heritage Foods. The judge directed that the matter be listed on August 31, 1999.

Tell us what you think of this report