“TCI has received advice that the conduct of CIL and its management over the past months constitutes serious breaches of key provisions of Indian corporate law, namely, breach of fiduciary duties and CIL’s affairs being run in a manner that is both prejudicial to the public interest and oppressive to shareholders,” the fund said in a statement.
TCI has been unhappy with the corporate governance standards at Coal India. TCI is a minority shareholder in Coal India and believed that the company has violated corporate governance standards by selling Coal at rates that were much lower than the market rates.
The government has of course emphasised the need for public interest over profitability. The share of Coal India were trading lower by 2% at rs 336 at 11.30 am IST.