The board of directors of Bilt will discuss the Bajoria affair threadbare on Monday and may pass a resolution for blocking Mr Bajoria's entry into the board, sources said. The company will also announce its first quarter financial results on Monday.

The sources said Bilt is taking legal opinion on the acquisition of stake by Mr Bajoria. Bilt is studying the case filed by Bombay Dyeing before the Company Law Board (CLB) against Mr Bajoria. CLB has frozen voting rights on shares held by Mr Bajoria in Bombay Dyeing.

A Bilt spokesperson, when contacted, said the company had not yet filed any legal case against Mr Bajoria in CLB or any other court. However, he declined to comment on the future strategy.

Financial institutions and the Saudi Arabia-based Al Murjan group will play a significant role in shaping Bilt board's strategy as they hold 32 per cent and 17 per cent stake in the company. The Thapars control 32 per cent shareholding in the company. The Sources added that FIs were first informed about Mr Bajoria's interest in Bilt in April this year, immediately after Mr Bajoria informed the company that he had acquired 10 per cent stake.

Bilt, surprisingly, did not inform the the Securities and Exchange Board of India (Sebi) at that time. A Bilt spokesperson, when asked to comment on why the company did not intimate stock exchanges or Sebi earlier, said the company did not take Mr Bajoria's letter seriously as it was not in conformity with the prescribed format under the takeover code. Bilt has, however, now taken up the matter with Sebi.

Bilt claims that as per its shareholders' records, Mr Bajoria owns only 3 per cent stake in the company but admitted that he may be indirectly controlling another 3 per cent stake through associate companies and friends. Mr Bajoria may have held 10 per cent stake in Bilt prior to the merger with AP Rayon. Bilt's equity base increased to Rs 72 crore from Rs 60 crore after the merger.

The company's managing director Gautam Thapar and his uncle and chairman LM Thapar have so far maintained that they are not worried over Mr Bajoria acquiring a six per cent stake in the company. Bilt believes that Mr Bajoria has acquired the stake in gross violation of Sebi's takeover code.However, sources close to the Thapars said this does not mean that the management is complacent over the whole affair.

Bilt's share price shot up on Friday even as the rest of the shares fell across the board. If the share price continues to rise with high volumes of trading, it may worry the management as it would confirm that large number of shares are being cornered by some interested parties.

The share hit a 16 per cent circuit breaker on Friday to close at Rs 68 on the Bombay Stock Exchange (BSE). The volumes were also unusually higher as over 2.50 lakh shares were traded on the BSE.

Market sources said that such a large volume on Friday, the last day of the trading cycle, when compared to daily volumes of 30,000 to 50,000 shares on the first four days of the week, indicates that there was genuine buying in the scrip. It means that the buyers will take delivery of the shares and it was not squaring-off of positions taken during the first four days of the week.