HC stays order on caretakers

The Calcutta High Court on Thursday set aside a trial court order appointing four administrators to Priyamvada Birla’s Rs 5,000-crore estate, which includes the flagship Birla Corporation and several other companies of the M.P. Birla group. A division bench comprising Justice P.C. Ghose and Justice T.K. Dutta, while setting aside the order of Justice K.J. Sengupta appointing the four administrators to the estate, directed Mr R.S. Lodha, Priyamvada’s chartered accountant, not to sell any part of it or spend any amount from it except for its maintenance.

Disposing of the appeal filed by Mr Lodha against the May 19, 2006 order of Justice Sengupta, the division bench directed that Mr Lodha would have to maintain separate accounts for the business earnings and dealings of the estate. The estate has been the focus of a bitter legal battle between the Birlas and Mr Lodha since June 2004 immediately after the death of Priyamvada, M.P. Birla’s widow.
Mr Lodha had claimed that the entire assets of the Birla group had been willed away to him by Priyamvada through a purported will made in 1999. The Birlas, however, challenged Mr Lodha’s claim in the court contending that the M.P. Birla group estate was meant for charity.

In another development, the Supreme Court on Thursday reserved judgment in the cross-appeals filed by the Birlas and Mr Lodha challenging each other’s right to object to Priyamvada Birla’s purported 1999 Will and late M.P. Birla’s 1982 Will, respectively.
Under the 1999 Will, Priyamvada had bequeathed her Rs 5,000 crores estate to Mr Lodha. A bench headed by Justice S.B. Sinha, which heard the matter since Tuesday, reserved its verdict. The three Birla family members — mr K.K. Birla, Mr B.K. Birla and Mr Yashovardhan Birla — had sought caveatable interest in Mr Lodha’s probate petition for M.P. Birla group’s assets.