The Calcutta High Court today directed administrators of the estate of late Priyamvada Birla to protect her assets.
A division bench of Chief Justice J N Patel and judge Soumitra Pal, deciding on the rights and powers of the committee of administrators, directed that they would be entitled to all rights as shareholders in respect of shares that formed part of her estate. “The court held that the administrators of the estate of Priyamvada Birla are entitled to all rights as shareholder in respect of the shares which formed part of her estate. It may be noted that Birla had very nominal shareholding in the operating companies of the M P Birla group, namely Birla Corporation, Universal Cables, Vindhya Telelinks, Birla Ericsson Optical and others,” Debanjan Mandal, partner of Fox & Mandal, Lodhas’ solicitor firm, said.
Late Priyamvada Birla held 1,260 shares in Birla Corporation Ltd, 500 shares in Vindhya Telelinks, 42,003 shares in Universal Cables and 72,241 shares in Birla Ericsson Optical.
She, however, had a majority in two investment companies, East India Investment Company and Gwalior Webbing Company, which in turn, has shares in the listed companies.
For instance, in Birla Corporation, Gwalior has 2.31 per cent, while East India has 3,183 shares. In Universal Cables, Gwalior has 7.30 per cent and East India 0.91 per cent. In Vidhya Telelinks, Gwalior’s holding stands at 0.07 per cent and East India has 100 shares. In Birla Ericsson Optical, East India’s holding is 1.67 per cent and Gwalior Webbing has 100 shares. There is also considerable crossholding between the listed companies. “With today’s order, the administrators have gained control of the M P Birla group. This is what we wanted,” the Birla side said.
The court has directed that the administrators, however, cannot distribute any asset of the estate over which the Birlas and the Lodhas are fighting a bitter legal battle since 2004, following the death of Priyamvada Birla.
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A division of the Calcutta High Court had earlier this year, constituted a committee of administrator pendente lites (APLs) for administrator of the estate of late Priyamvada Birla. The court today directed the administrators to administer the estate for its protection and preservation in their best discretion and wisdom.
The bench has granted a four-week stay on operation of the order on a plea by the counsels of the Lodhas.
On August 27, 2010, a single bench of the Calcutta High Court had appointed a set of three administrators giving them various powers to administer the estate of the deceased. The order was challenged by the Lodhas before the division bench of the Calcutta HC and by order dated February 23, 2012, a new committee was appointed. By today’s judgement, the rights and powers of the committee has been decided.