The Curious Case Of Tree House’s Stock Exchange Filings
Fresh trouble for Tree House after Zee Learn merger called off.
A week after its proposed merger with Zee Learn was called off, Tree House Education and Accessories Ltd. has allegedly encountered a curious case of “frivolous” and fraudulent exchange filings. Rajesh Bhatia, founder of the Tree House Group, filed a police complaint at the Khar Police Station in Mumbai regarding the matter, the company said in a fresh stock exchange filing on Wednesday.
Here’s how events unfolded.
On December 3, the company had filed the 'outcome of board meeting' on both stock exchanges stating that Bhatia's designation had been changed from managing director to whole time director of the company.
This is to inform you that the meeting of the board of directors of the company held on Friday, December 2, 2016, the board has considered and approved the change in designation of Mr Rajesh Bhatia from managing director to whole time director of the company with effect from December 2, 2016, subject to the approval of the members of the company.Tree House’s Stock Exchange Filing on December 3
The same exchange filing also announced the appointment of G Raj Kumar as an additional independent director of the company.
Subsequently, on December 21, the company filed another statement saying that the outcome of the board meeting was coerced and no such meeting had taken place.
The company would like to place on record that there was no board meeting held on December 2, 2016. Further, the signature of the company secretary of our company on the outcome of the said so called board meeting were obtained by coercion. It is worthwhile to mention that he was not even in town on the said date. Mr Rajesh Bhatia, managing director of the company has filled complaint on above matter as on December 12,2016 at Khar Police Station.Tree House’s Stock Exchange Filing on December 21
Raj Kumar resigned from his position as additional independent director on December 15 but the resignation has no real impact as the appointment itself was null and void, the company said in the same filing.
In his police complaint, Bhatia confirmed that no board meeting was conducted on December 2 and that the management was shocked by the "frivolous nature of fraud".
Neither any notice, agenda for the board meeting was circulated to the directors, nor was there a board meeting conducted on December 2, 2016. The company secretary was forced to sign the outcome of the meeting (for a meeting which was never conducted) and file the outcome of board meeting. Further, it is respectfully submitted that the sudden filing on the portal of the outcome of the meeting was brought to the notice of the Managing Director by the end of the day. The management was shocked about the frivolous nature of fraud and it was in the stage of deciding about how to proceed, investigate and respond to unforeseen catastrophes at large.
Bhatia also said that the delay in clarification regarding the matter was unintentional and that the company has filed a petition with the Bombay High Court.
On December 19, Essel Group’s education arm Zee Learn had called off its proposed merger with Tree House citing bad press and had also threatened to take legal recourse to seek damages from the failed deal.
A few days later, Tree House Education and Accessories threatened to take legal action against Essel Group's education unit, saying that Essel Group has “played a fraud upon the company and its promoters”.