In what could be a big step forward for Shagun Gogia and her mother Madhu Kapur, the Bombay high court has directed Yes Bank Ltd to consider the nomination of Shagun, daughter of late Ashok Kapur, founder-director of the bank who died in the terror attack on Trident Hotel in 2008.

Shagun Kapur Gogia and her mother, Madhu, are locked in a legal dispute with the bank’s present chief operating officer and managing director, Rana Kapoor, over what they claim are their legal rights. Madhu’s sister is married to Rana Kapoor.

While delivering his order on Monday, Justice SJ Kanthawala also asked the bank advance its meeting to consider Shagun’s nomination from July 24 to June 27.

Meanwhile, in media release issued late Monday afternoon, Yes Bank said: “YES BANK’s Chairman Mr MR Srinivasan and MD & CEO Mr Rana Kapoor, had by YES Bank's letter dated 6th June, 2013 addressed to Mrs Madhu Kapur (prior to the AGM on 8th June, 2013, and before any litigation being filed in the Honourable Bombay High Court by Mrs. Madhu Kapur) had offered to discuss the name of Mrs. Madhu Kapur’s nominee at its scheduled Board Meeting to be held on 24th July, 2013.

“The Honourable Bombay High Court by its Order dated 10th June, 2013 has in response conveyed that the scheduled Board meeting should be conducted by 27th June, 2013.  This is in line with YES Bank’s proposal as per its letter dated June 6, 2013.”

Madhu Kapoor had last week filed a suit claiming that the Rana Kapoor group in the bank was seeking to keep out her family– that is, herself and her two children – from running the bank’s business after her husband’s death. The immediate provocation came last month when the family received the notice for business of the bank’s annual general meeting to consider nominations of three of its directors.

Madhu Kapur claimed that her group was not consulted before the nomination and that it was a gross violation of the shareholding agreements and Articles of Association of the company.

The three directors were appointed by majority vote on Saturday. They are Diwan Arun Nanda of Rediffusion, ex-HSBC banker Ravish Chopra and MR Srinivasan.

While the Ashok Kapur group owns about 12 percent of equity stake in the bank, Rana Kapoor’s group owns 13.7 percent.

Shagun had been rejected by a Yes Bank committee in 2009 on the grounds that she may not qualify for the Reserve Bank of India’s requirements for a director. Shagun has two graduation degrees, one each in Economics and Biology, and an MBA from Tufts University in the US.

Appearing for Madhu Kapur, senior counsel JJ Bhatt argued that the three directors had already been appointed on Saturday. He said the Ashok Kapoor group had not even insisted on Shagun being made director but only that they be included in the consultation.

Madhu Kapur had also written to Rana Kapoor as late as on June 4 this year about this, when she told him that she felt “sidelined”, Bhatt argued. Despite this, he chose to ignore their attempts to resolve the differences and the business of the meeting remained unchanged.

Justice Kanthawala then asked Bhatt whether Shagun was still interested in being director. Bhatt replied in the affirmative. He also said that, in fact, Rana Kapoor should support her nomination. To that, Rana Kapoor’s cousel, Virendra Tulzapurkar, said he could not commit to that on behalf of his client.

The judge thought the dispute could be solved without letting it get more contentious or ugly. He ordered the bank to hold the meeting on June 27 and said that all appointments of directors will be subject to the final orders of the court.

In a media statement, the bank also said: “Three resolutions pertaining to the appointment of Mr Diwan Arun Nanda; Mr Ravish Chopra and Mr MR Srinivasan, whose appointments was earlier approved by the Board of Directors, were put to poll upon the request of a shareholder. The said request was accepted and the said three resolutions were put to poll. Overall 57% of the total shareholder ownership votes were polled and the General Body of the shareholders passed all three resolutions with an overwhelming majority of about 80%, and elected all the three aforesaid Directors.”