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The Centre and the Reserve Bank of India are free to proceed with the merger of Lakshmi Vilas Bank with DBS Bank India, said Madras High Court while refusing to stay the merger.
A division bench consisting of Justice Vineet Kothari and Justice MS Ramesh declined to give a blanket interim order against the merger as the scheme has already come into operation.
The bench also adjourned the plea filed by AUM Capital Market Pvt Ltd challenging the merger to January 21. It asked both the RBI and DBS Bank to file counters. It also directed DBS Bank to give an undertaking that it would compensate LVB’s shareholders in case the writ petition filed against the amalgamation scheme is decided against it.
The petitioner alleged that the merger scheme violated the Banking Regulation Act that requires the RBI to take into consideration the bank’s stakeholders before going ahead with the merger.
It may be recalled that on Thursday, the Bombay High Court refused to stay on the final scheme of the merger.
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