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Delhi High Court directs Micromax, Sanjay Kapoor to settle dispute via mediation

The court approved the appointment of Sudhanshu Batra as mediator to help resolve the issue that arose upon the termination of Kapoor’s services from India’s second-largest handset maker.

, ET Bureau|
Jan 08, 2016, 08.20 AM IST
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The court approved the appointment of Sudhanshu Batra as mediator to help resolve the issue that arose upon the termination of Kapoor’s services from India’s second-largest handset maker.
The court approved the appointment of Sudhanshu Batra as mediator to help resolve the issue that arose upon the termination of Kapoor’s services from India’s second-largest handset maker.
NEW DELHI: The Delhi High Court has asked Micromax Informatics and its former chairman Sanjay Kapoor to settle a dispute over alleged denial of stock options through mediation and gave them a month to reach an agreement.

The court approved the appointment of senior lawyer Sudhanshu Batra as mediator to help resolve the issue that arose upon the termination of Kapoor’s services from India’s second-largest handset maker.

Micromax and Kapoor, a former CEO of Airtel, will begin talks on January 14 and are slated to appear in court on February 16 with a solution in place, according to people privy to the development.

“Both parties jointly requested the court to appoint a mediator since there is a possibility that the matter can be resolved,” a legal representative of one of the sides said, requesting anonymity. “The court has therefore allowed this request.”

Kapoor declined to comment on the matter. Micromax confirmed that Delhi High Court judge Najmi Waziri had directed the parties on Thursday to resolve the dispute through mediation.

“The Honourable High Court of Delhi has been pleased to appoint a mediator to enable the parties to explore a possibility of an amicable resolution of the matter,” Micromax said in a statement.

If the talks, which will be confidential in nature, don’t result in a solution before the February 16 deadline, the parties may seek the appointment of an arbitrator, sources say.

Micromax, which trails Samsung Electronics in India’s smartphone market, announced Kapoor’s exit mid-last year. It later emerged that the former chairman was asked to leave after allegations that he misappropriated fuel expenses.

The Micromax board acknowledged Kapoor’s resignation at a meeting on August 1 and employee stock options issued to him were revoked the same day. When Kapoor joined Micromax in June 2014, he had been promised over 1% of the company’s shares in stock options.

In his two-page resignation letter to the Registrar of Companies, reported by ET on October 9, Kapoor denied the allegations made by the company and said his termination – through a July 10 letter from the company – was uncalled for and arbitrary.

“I have lost faith and confidence in the board...Needless to say that I would initiate legal action against the company,” Kapoor added.

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