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Birla-Lodha dispute: Calcutta HC shuts out Harsh Vardhan Lodha from Rs 25,000-crore MP Birla Group – Moneycontrol

The Calcutta High Court on September 18 issued directions restraining Harsh Vardhan Lodha from holding any position in the Rs 25,000 crore MP Birla Group, or its associated entities, and also from drawing any benefit from the assets of the estate.

The 16-year-old legal row between the MP Birla Group companies, represented by a faction led by MP Birla’s sister Laxmi Devi Newar’s scions Arvind along with his brother Ajay and the Lodhas, over controlling the Birla Estate had its genesis in the contested will of the late Priyamvada Devi Birla, the widow of MP Birla. This will was executed in July 1982 after the purported will allegedly transferred the shares of the MP Birla Group, collectively called the Birla Estate, in favour of the late Rajendra Singh Lodha.

The legal tussle began after the July 13, 1982 mutual wills gave away all the assets to charities, but another will dated April 18, 1999 granted them to Rajendra Lodha, now being pursued by his son Harsh Lodha, and other heirs of the senior Lodha.

A new twist emerged in the story in July 2019, when in a 2:1 order, the Calcutta HC-appointed three-member administrator committee (APL panel), headed by retired Bombay HC judge Mohit Shah, opposed the board’s decision of the three listed MP Birla Group companies to re-appoint Harsh Lodha as Non-Executive Chairman.

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This forced the Lodhas to challenge the APL order in the High Court saying the board decision should have been above that of the panel, which also should have decided unanimously and not by majority.

In its report submitted to the Calcutta HC, the administrator pendente lite (APL) panel, appointed in August 2012, also said it “does not support payment of commission on net profit to the non-executive chairman of group companies.”

Following this, the Lodhas moved the HC first on August 2, 2019, and then twice on August 5 and August 9 the same year, to cancel the annual general meetings (AGMs) of these companies scheduled for August 13 in Kolkata. But the HC gave the go-ahead for the AGMs but asked to withhold the results till the pendency of the case, which was then ordered in favour of the Lodhas.