Lodha Vs Birla gets sticky

Privately, at least, many in the Birla family admit they are now entangled in a legal quagmire.The criminal case filed by the Birlas against...

Privately, at least, many in the Birla family admit they are now entangled in a legal quagmire.

The criminal case filed by the Birlas against R.S. Lodha is coming up for hearing on March 18, and if lawyers are to be believed, Friday’s judgement by Justice Kalyan Jyoti Sengupta will play an important role. The Birlas had filed the criminal case, alleging that Lodha along with his associates — Shivnath Prasad, V. Gauri Shankar and S.K. Daga — had resorted to cheating and criminal conspiracy. It was alleged that Lodha had committed a fraud on Priyamvada Birla, who by her purported 1999 will had bequeathed the entire assets to him.

But with Justice Sengupta retaining Lodha’s interest, the other cases have taken a curious turn.

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Justice P.N. Sinha — who is hearing the criminal case — had earlier restrained Calcutta city civil court from passing any order as he was seized of the matter. Says Debanjan Mandal, partner of Fox & Mandal and solicitor of Lodha: ‘‘It is a big victory for us. It’s absurd on the part of Birlas to claim victory when the Judge has thrown out caveatable interest of three Birlas and retaining Lodha’s interest for 1982 will as well.’’

N.G. Khaitan, solicitors for the Birlas say the future course of action will now be to file a caveat on behalf of G.P. Birla, M.P. Birla sisters: Laxmi Devi and Radha Devi and two other executors of 1982 wills: K.N. Tapuria and P.K. Khaitan. ‘‘Let me clarify this is not a victory for Lodha as made out by the media,’’ says Khaitan. ‘‘We have rights to file caveats for both the joint M.P. Birla’s 1982 Priyamvada’s 1999 will,’’ he said.

The fact remains that the mood in the Birla camp is turning from anger to nervous dispair. Admitting that R.S. Lodha is already in ‘full control’ of key MP Birla firms, Birla sources say they have no other option but to wait for the lengthy court battles to get over and at the same time expedite Pilani Investments’ consolidation.

Though the Birlas are publicly showing a united front, the Calcutta High Court judgement has made it clear that the Birla clan can never be called a Hindu Undivided Family — a loophole Lodha has taken full advantage of.

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The move by B.K. Birla and Kumar Mangalam Birla family to consolidate the holding firm Pilani Investments under either B.K.-K.M. or G.P.-C.K. Birla (Hindustan Motors) is a case in point. But now, the prospects of Lodha controlling 25 per cent of Pilani Investments is already giving sleepless nights to the Birlas — especially to patriarch B.K. Birla. ‘‘We are hopeful of concluding the consolidation in the next one to two years,’’ a family member said. Time is of essence.