CAN AN INDEPENDENT DIRECTOR BE SUED BY A LISTED COMPANY FOR CONFIDENTIALITY BREACH AND UNDISCLOSED CONFLICT OF INTEREST ?

 CAN AN INDEPENDENT DIRECTOR BE SUED BY A LISTED COMPANY FOR CONFIDENTIALITY BREACH AND UNDISCLOSED CONFLICT OF INTEREST ?

ALLEGATION BY AMPVOLTS LIMITED AGAINST INDEPENDENT DIRECTOR JAYDEEP MEHTA

Mr.Jaydeep Mehta was an independent director in the AMPVOLTS Limited, a listed company.

Jaydeep Mehta has resigned as an independent director of AmpVolts Limited, effective October 20, 2025.

The company cites a confidentiality breach and undisclosed conflict of interest, while Mehta's resignation letter points to governance concerns and the board's inaction on alleged financial irregularities.

The company is considering legal action, while Mehta has also ceased to be a member of the Nomination and Remuneration Committee.

ALLEGATION THROUGH EMAIL BY INDEPENDENT DIRECTOR

On 22 August 2025, while still holding office as an Independent Director, Mr. Mehta addressed a formal email to the Board with the subject “Closure of the Preliminary Reviews against the Claims Made after Providing Self-Proclaimed Extended Timelines.”

FINANCIAL AUDIT BY THE REQUEST OF INDIVIDUAL SHAREHOLDERS

In that email, he referred to the allegations of one of the shareholders, Mr. Anant Shah and his spouse, Mrs. Manisha Shah, and recommended that the Board constitute a special committee of independent directors and initiate a financial audit.

EXTERNAL PARTIES

Email was copy-marked by Independent Director, Mr. Mehta to multiple external parties—none of whom had any official capacity in Ampvolts Limited.

The same email had not even been copied to one of the serving independent directors, Mrs. Tejas Shah.

INDEPENDENT AUDIT

An independent audit as per the scope defined by them had already been completed on 16 July 2025 by an external audit firm selected by Mr. Mehta himself and that no irregularities were found. The reply explicitly asked Mr. Mehta to explain the relevance and authority of sharing confidential company information with outsiders who had no locus standi in the Company’s affairs. This raises further questions on the role and conduct of the independent director.

RESIGNATION ON HOLD

Management held a meeting with Mr. Mehta in person on 23 September 2025. Convinced with the proper and sufficient explanations against the allegations of the shareholder couple, Mr. Mehta, in his email on the same date, kept his resignation on hold and requested the management to appoint an independent secretarial auditor.

A SPECIAL SECRETARIAL AUDIT

The Company management gave consent to Mr. Mehta to appoint an independent secretarial auditor and provide them with the scope of work. The management also informed the other independent directors regarding the decision to conduct a secretarial audit. However, Mr. Mehta did not wait for the report but chose to resign, defying his own statement.

DIRECT OR INDIRECT INTEREST CONFLICTS WITH THE COMPANY'S INTEREST.

Mr. Mehta’s firm, LexStreet Advisors LLP, a law firm, is also representing certain shareholders of the Company who are simultaneously involved in adversarial actions and allegations against the Company management. This material association was never disclosed in any declarations or in any subsequent communication to the Company, thereby constituting a clear violation of Section 166(4) of the Companies Act.

ADVISING AND REPRESENTING ADVERSARIAL SHAREHOLDERS

As an Independent Director, the Company expected transparency and an unbiased approach from Mr. Mehta. However, the above chronology of events raises serious questions and reveals a consistent pattern of misuse of confidential information and conduct inconsistent with the statutory expectations from an Independent Director. Mr. Mehta’s continued partnership in a firm that was advising and representing adversarial shareholders constitutes a direct violation of Sections 149(6), 149(7), and 166(4) of the Companies Act, 2013.

SEBI (LODR) AND PIT REGULATIONS

By disseminating confidential communications to outside parties, he has also breached Section 166(3) of the Act and the SEBI (LODR) and PIT Regulations, raising a strong presumption of sharing unpublished, price-sensitive information.

CONFLICT OF INTEREST AND BREACH OF FIDUCIARY RESPONSIBILITY COMMITTED BY MR. JAYDEEP MEHTA

The Company reserves its right to initiate necessary legal proceedings including intimation to statutory/regulatory authorities about the conflict of interest and breach of fiduciary responsibility committed by Mr. Jaydeep Mehta during his tenure as Independent Director, in connivance with Mr. Anant Shah.

Will Mr Jaydeep Mehta answer all these allegations made against him?

What is the retaliatory action he wish to initiate against AMPVOLTS Limited?

R V SECKAR, FCS,LLB 79047 19295