Alhaj Textile writ: Stay order against BSEC decision vacated

Last week's stay order against the securities regulator's 5 June letter that reconstructed the board of Alhaj Textile Mills was declared vacated by the appellate division on Wednesday. 

The appellate division, however, instructed to remove the independent director whose name appeared on any charge sheet, according to Barristers A M Masum and Sayed Mahsib Hossain, the lawyers for the Bangladesh Securities and Exchange Commission (BSEC).

"The vacated stay order means the regulator's decision remains upheld," Sayed Mahsib Hossain told TBS.

After getting the certified copy of the vacant order that came after the leave to appeal for a civil miscellaneous petition by the BSEC, the regulator's lawyers would go for a civil petition, said Hossain.

Last week, Alhaj Textile Mills and its managing director filed a writ petition against the securities regulator's decision of appointing four independent directors at the company, and also secured a stay order for six months.

The company and its incumbent Managing Director Mohammed Bakhtiar Rahman, in a joint petition, also pleaded for a rule regarding the legality of the appointment of the independent directors.

Following internal conflict, grouping, and litigation that halted the company's banking transactions, the BSEC on 5 June reconstructed the board of Alhaj Textile by removing three of the five independent directors it appointed earlier. Alongside, the BSEC had appointed two new independent directors.

Later, one of the two new independent directors resigned. Also, the name of one of the continuing independent directors emerged in the Anti Corruption Commission's charge sheet in the BASIC Bank scam case.

However, Alhaj Textile has been in a deadlock due to litigation with its lender, while it was also running without having 30% shareholding by sponsor-directors.

The BSEC stepped in during the pandemic and assigned the reconstructed board to solve all the problems.