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Kundan Minerals and Metals Limited, the Successful Resolution Applicant for Eastern Sugar & Industries Limited, has moved to rectify an inadvertent error in the approved resolution plan that has led to a reduction of public shareholding to 2.28%. This contravenes Rule 19A(5) of the Securities Contracts (Regulation) Rules, which mandates that public shareholding must not fall below 5%. The Applicant asserts that this issue must be addressed to maintain listing privileges and facilitate future fundraising efforts.
In response, the National Stock Exchange of India has raised concerns regarding compliance. However, the court recognized that the application seeks to amend the plan to ensure compliance with statutory requirements rather than alter its core components. Citing prior precedents, the court allowed this amendment, underscoring that the integrity of the resolution plan must be preserved while conforming to legal obligations. The outcome is a positive step for Kundan Minerals as it aims to stabilize Eastern Sugar's operations while adhering to regulatory standards. Shareholders should follow this development closely, given its implications for corporate governance and market positioning.