The Supreme Court on Monday refused to interfere with the Calcutta High Court order dismissing contempt petitions filed against Harsh Vardhan Lodha for continuing as a director and chairman in companies of the M P Birla Group. A bench of Justices D Y Chandrachud and Hrishikesh Roy said it was not inclined to interfere with the high court order of April 22, as appeals are still pending there.
The apex court directed the high court to make an endeavour to dispose of the bunch of pending appeals as expeditiously as possible and in any event on or before March 31, 2022. The group companies headed by Lodha are Birla Corporation, Universal Cables, Vindhya Telelinks and Birla Cable.
Appearing for the Birlas and petitioner Arvind Kumar Newar, a battery of senior lawyers Kapil Sibal, P Chidambaram, K V Vishwanathan and Janak Dwarkadas, said the high court is completely wrong in dismissing the contempt petitions. The High court said that he has to comply with its order but he has not complied with directions. I am not interested in contempt or sending him to jail but I want him to be removed, Sibal said.
Senior advocate Shyam Divan and advocate Sumeer Sodhi, appearing for Vindhya Telelinks Ltd, said a direction be issued that all the pending appeals before the High Court are heard in four weeks. Divan said that there were several contempt petitions filed and opposite party have selectively chosen one contempt petition and they have been repeatedly writing letters to the company.
He said that they have no registered share in the company and since the last two years the actions of the two of the three administrators have constantly been to interfere with the affairs of the companies under the guise of an unwarranted/ illegal control by the Committee, not only over the Estate but also over third-party trusts, societies and publicly-held companies which are part of the MP Birla Group. Senior Advocate Darius Khambata, appearing for Lodha, said the the High Court’s single-judge verdict on September 18 last year had refused to interfere with the resolutions passed at the annual general meetings of the four manufacturing companies, where his client was reappointed as director by an overwhelming majority of at least 97.98 per cent of votes cast in his favour.
The Birlas and the Lodha family are embroiled in a litany of court proceedings over the M P Birla Group’s assets. On April 22, the High Court had dismissed several contempt petitions filed against Lodha for continuing as a director and the chairman in companies of the M P Birla Group. The High Court had also dismissed contempt proceedings against other directors of the companies in view of findings of the court that Lodha has not committed contempt by attending board meetings as director/chairman of the company.
It had observed that Lodha’s participation in the board meetings “cannot be termed as contumacious violation of the order of this court as willful disobedience has not been proved beyond reasonable doubt.” “There is a possibility that he could continue to hold office on the strength of the votes of public shareholders in exclusion to the votes of the APL (Administrators Pendente Lite) Committee and the promoter and promoter groups and PACs (persons acting in concert),” the court had said. An APL is appointed by a court to begin probate proceedings during a lawsuit that challenges the will. The contempt petitions before the High Court were filed by the Birlas alleging willful violation of an order passed on October 1 last year.
In that order, the High Court had declined to pass an interim stay on a single bench judgment over administering the Priyamvada Devi Birla Estate by a court-appointed committee, while clarifying parts of the order under challenge. The high court is hearing a probate application by Harsh Vardhan, whose late father R S Lodha had claimed that Priyamvada Devi Birla bequeathed her estate, comprising the M P Birla Group, to him through a will.
The Birlas, one of the oldest industrial groups in the country, have challenged the probate application by the Lodha family and they have been involved in a legal battle over the control of the M P Birla Group since the death of Priyamvada Devi Birla in 2004. Priyamvada Devi Birla’s husband M P Birla died in 1990.
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