Financial Daily from THE HINDU group of publications
Saturday, Feb 04, 2006
Financial Daily from THE HINDU group of publications Saturday, Feb 04, 2006 |
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Courts/Legal Issues Corporate - Corporate Disputes SC verdict: Birlas seek Lodha's resignation from group posts Our Bureau
Mr R.S. Lodha - Parth Sanyal
Kolkata , Feb. 3 THE legal team of the Birlas on Friday sought the resignation of Mr Rajendra Singh Lodha from the post of Chairman of Birla Corporation Ltd and other organisations of the MP Birla Group. Addressing a press conference, Mr N.G. Khaitan of the Kolkata-based legal firm Khaitan & Co said that their stand had been vindicated by the Supreme Court judgment passed on Friday. The apex court upheld the Calcutta High Court order and stated that the criminal case against Mr Lodha cannot be quashed or stayed. So, criminal proceedings against him would soon restart at the Chief Metropolitan Magistrate's (CMM) court in Kolkata. In his reaction, Mr Debanjan Mandal of the legal firm, Fox and Mandal (solicitors of Mr Lodha), explained that the Supreme Court has only directed the trial court (CMM) to probe into the allegations before proceeding further. "The Supreme Court has not voiced any opinion on the merit of the case. The onus now falls squarely on the opposite side to demonstrate before the Magistrate that there was indeed, prima-facie an offence disclosed which would require further trial and evidence by both sides," he said. While demanding Mr Lodha's resignation, Mr Khaitan said that he should "resign forthwith" not only from the directorship of the MP Birla Group companies but also from its charitable institutions. "Mr Lodha would now be facing a criminal trial. On moral grounds, he should resign from all the posts. He should not meddle with the MP Group companies and the trusts. This is the biggest charitable trust of India whose worth two years ago was Rs 2,400 crore. Now, it would be more than Rs 5,000 crore," he said. Reacting to Mr Khaitan's demand, Mr Mandal only said that "it is totally out of context" and his client would continue to function as he has been doing till now. The Birlas had argued that Mr & Mrs M.P. Birla had passed on their holding in their companies to five charitable trusts and three charitable institutions in their mutual wills of 1981 and 1982. These five trusts are MP Birla Trusts, Priyamvada Birla Trust, Priyamvada Birla Fund, Priyamvada Birla Kosh and Piryamvada Birla Niddhi. The charitable institutions are MP Birla Foundation, Hindustan Medical Institution and Eastern India Educational Institution.
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