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. 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. 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. |
I am about to get married. I earn Rs 40,000 per month and my would-be-wife earns Rs 30,000. While planning our finances together, what are the things we need to keep in mind? Both of us have commitments towards monthly investments in two mutual fund schemes each and two annual payments towards life insurance. As far as finance is concerned, the ultra important thing the two of you need to do together is to sit and draw up a monthly budget. This will offer you a clear picture of all your commitments. The next challenge is to see whether you are sticking to your budget. Monitor this for at least six months before taking the next step. I (55) had bought a shop in Kandivali, Mumbai, eight years back. I earn Rs 11,000 a month as rent. My son wants to study abroad and I will need Rs 30 lakh for the two-year course. My investment in PPF is Rs 15 lakh and in stocks is Rs 8-10 lakh. Should I liquidate my investments or sell the shop? First of all you have not mentioned the current market value of your shop. Secondly, you have not mentioned your current income and corresponding expenses. In absence of these two data, we have to make certain assumptions like you are not dependent on the rental earnings from the shop. Ideally you may check with few banks, how much loan, you may get against your future rent receivable. Also, you can take an education loan which your son may repay in future and get tax benefit. If there is still a gap, then only consider selling a part of your investments in stocks and redeeming a part of your PPF.
Right now your capacity to invest outside your business is limited to Rs 10,000. It is recommended that you invest this amount in a good balanced mutual fund for long-term via the systematic route or SIP. As your cash flow increases, you may have to invest a larger amount in future to make provisions for your child's education and to safeguard your family's future in a diversified equity based mutual fund. The writer is Director, Gliese Consultin Against public interestThe Government's directives to PSUs cast a financial burden on them. Public interest would be better served by proper disclosure. It is unfortunate that the Centre has rejected the Parliamentary Standing Committee on Finance's recommendation to incorporate a provision in the Companies Bill, mandating public sector undertakings (PSU) to disclose the impact that implementation of government directives have on their finances. There is no formal structure now for such disclosure. Hence, even if companies choose to report at all, they are usually tucked away in the 'notes to the accounts/significant accounting policies' sections, as opposed to the Board of Directors' report or some other prominent statements. Nor is there any prescribed format under which the financial implications specifically resulting from government directives are reported. The need for providing such information in the director's report — and including this as part of the Companies Bill now in Parliament — is something that even the Comptroller and Auditor General of India had earlier proposed. The Centre's reaction to these suggestions is strange: According to the Ministry of Corporate Affairs (MCA), a large number of disclosures are already provided for inclusion in directors' reports and, hence, no purpose is served by "adding further requirements for a particular class of companies in a general enactment on companies". But the fact is PSUs are not just any 'particular class of companies', just as the government is no ordinary promoter. When oil marketing PSUs are forced to sell diesel or kerosene at below their realisable market prices, or a Coal India is directed to ink fuel supply agreements with power plants on terms it would not ordinarily enter into, these companies are only doing the bidding of the government. While doing so, they forego revenues or even incur losses, thereby affecting the interests of minority shareholders. Even in the event of their not being listed, the public is entitled to know the financial burden that companies set up with taxpayers' money are having to bear on account of following official directives — for good or bad. Such information when presented in an upfront and transparent manner — without recourse to confusing terms such as 'under-recoveries' — may even lead the public to seriously weigh the trade-offs between persisting with populism and compromising the very existence of companies that they ultimately own. The Parliamentary panel has rightly argued that mandatory reporting of the financial impact of following state directives is a step towards ensuring greater functional autonomy and operational efficiency of PSUs. These eventually would lead to minimising government interference in their management. This position is in refreshing contrast to that of the MCA and the Department of Public Enterprises, which believes that any such disclosure requirements be 'administratively prescribed' rather than have statutory backing through legislative enactment. It only demonstrates the sheer reluctance among ministers and bureaucrats to let go of their powers to 'direct' PSUs — and not account for it either (This article was published on August 23, 2012) I don't dream, I just do it Rajashree Birla. - Bijoy Ghosh After absorbing the shock of her husband Aditya Birla's early death, Rajashree Birla took on the challenge of spearheading the Birla legacy of social initiatives. Rajashree Birla was 10 and Aditya Birla was 14 when they got engaged; she lived in Madurai then. When asked if she had met or seen him before, she smiles: "Not that I can remember!" But by the time she was about to marry him at 17, in 1965, "my fiancé was taking a lot of interest in my education. I was doing science at Fatima College in Madurai, and he said: 'What will you do with science?' So I switched over to arts." Rajashree, Chairperson of the Aditya Birla Centre for Community Initiatives and Rural Development, the Aditya Birla Group's apex CSR body, addressed a FICCI- FLO meeting on CSR in Chennai last week. Reminiscing on her early years, she said that though she got married halfway through her degree course, her late husband encouraged her to complete her graduation (English and Political Science) from Loreto College in Calcutta. "My son (Kumar Mangalam Birla) was born in 1967, so I couldn't write my B.A. exam, but the environment at home was so supportive that I later completed my studies and graduated." Her father was a Burmah Shell agent, and she recalls the days she spent in Chennai's Sowcarpet, where she lived with her uncles whenever she passed through the city. I ask her how the match was made and, more important, how did it feel for a girl hailing from a middle-class family to marry into an illustrious business family such as G.D. Birla's. Was it a cultural shock? "Well, the match was arranged by some common relatives and, no, there was no matching of horoscopes," she smiles, adding, "Cultural shock? Not really, because having moved and stayed with Gandhiji, our family... my parents-in-law and grandfather-in-law (G.D. Birla) had a very simple lifestyle. There was no glamour or fuss in our home," she adds. For many years into her marriage, Rajashree, who is today on the board of all the group companies, was busy bringing up her son and daughter and didn't have much interest in "the business side". A period of deep shock But in 1995 she faced "the most difficult part" of her life when she lost her husband, who was only 52 then. Recalling that period, she says, "He was quite ill for four months… so your mind is at least prepared. But when he fell ill, I thought… in Hinduism they say that a person is taken away by god only when he has completed all his work. But my husband had a lot of future plans, so I thought nothing can happen to him, because he has so much more to do." Her son, Kumar Mangalam, was just 27, "he had to take over the business." So, as a mother, how did she steer him through that difficult phase? "Well, I knew nothing about the business… but yes, I must have given him a lot of moral support in those days," she says, her eyes clouding. A short pause, then she adds: "But, luckily, he was trained for the role he had to play. He was a qualified chartered accountant and also an MBA from the London School of Business." I ask her to name the most endearing quality of Kumar Mangalam Birla. Rajashree is all smiles and says, "I feel he is really humble, if you want me to choose only one quality. But another important quality is that he is very, very balanced…" "He is very proud of Rajashreeji", chips in the group's corporate communications chief, who is present. "And I am very proud of him, actually much more proud of him," quips the mother! Pioneered by G.D. Birla We move over to the group's CSR activities, which Rajashree heads, and into which the group pumps in Rs 160 crore every year, with Rs 40 crore of it going to educational ventures. "Actually these development activities were started much earlier, by my grandfather-in-law, G.D. Birla. Education was his main passion and he had started BITS Pilani and many schools; and for starting a Montessori school, he invited Ms Montessori to Pilani, and got her to stay for a year and set it up." Today, of course, Rajashree oversees the group's social and welfare activities across 40 companies. She has received a Padma Bhushan for social work. This work is spread across 3,000 villages and touches seven million people. The Aditya Birla Group runs 18 hospitals and 42 schools, two of them modern international schools, for paying students. Of the 42,000 children studying in these schools, 18,000 receive free education. The schools are concentrated where the group's business ventures are located, and this includes countries like Thailand and Egypt. So how passionate is she about her role in the Aditya Birla Centre? "Very much… I think about it all the time. This is my main occupation. At the end of the day, it makes you feel good that you are doing something to help people… farmers, women's self-help groups," says Rajashree. She is particularly focused on schemes to help the girl child and train women in employment skills. "We conduct widow remarriage functions, and have already held two such events in Uttar Pradesh, each time for about 100 women. Some of these women are so young and have long years before them. Our people talk to the parents and parents-in-law and convince them, and also find matches for these women." Battling female foeticide She is also actively engaged with the NGO Population First, where the focus is to save the girl child and spread awareness against female foeticide. "Can you believe that female foeticide happens even in Mumbai? Even though it is much lower here compared to other regions, this is a shame. And it is not as though it doesn't happen in educated and rich families. We work towards eradicating this evil and give scholarships for girl children," she adds. She is proud of the 4,000 self-help groups "we have formed in areas where our rural development work is concentrated. For women it is a huge empowerment… it empowers whole families." She is on the board of the Habitat for Humanity's Asia-Pacific and Global committees, and will attend a conference in Manila this week. With help from M.S. Dhoni and some other cricketers, she recently helped raise £2 million for the organisation to build houses for the poor. Her group has contributed about Rs 10 crore to Habitat. Rajashree's reply takes me totally by surprise when asked about her dream for the future: "Actually, I don't dream; I don't have any dreams. I believe in doing things and just go with the flow…" At a glance Favourite city: London; we have an apartment there and I love the city. Interest in jewellery: Not particularly… except that it has to match with my clothes! Favourite food: I am very fond of sweets (giggles) and all kinds of food. I also like spicy chaat.. I like to experiment with different cuisines. I love Ethiopian food, they have a roti called anjira, which looks like a very big dosai and it is a little sour, being fermented. That is eaten with sabji very similar to ours. Reading: Recently I've been reading on Vedanta; Swami Parthasarathy has written on Vedanta and I find it very interesting. Is she very religious? Not at all; actually I am not a religious person, but I can say I am spiritual. I don't believe in rituals. As a child, when my mother couldn't do some pooja or rituals for some reason, I would take over, and I really enjoyed all this then. But now I am not interested. Fitness: I exercise for two hours everyday; we have a gym at home. I do the cross trainer, sometimes the treadmill and then a yoga teacher makes me do dynamic yoga… fast and more difficult postures. I've been on such a routine for 15 years! Tech tools: I like working on the iPad, where I mostly do my mails, and listening to music on my iPhone. Music: Mostly bhajans and old Hindi film songs. Kishore Kumar is my favourite. Hobbies: I love going for holidays with my friends; we are a group of women and every year we take a three-week holiday. We've been to China, Russia, Australia…We do lots of sightseeing, that is a priority, and of course shopping! Slowing economy and India's future: We have a leadership crisis and decisions are not being taken. So many scams are coming out and there seems to be a feeling of fear amidst politicians who are refraining from taking decisions. Millions of BPL Indians: I have a lot of hope in the UID scheme; the Government of India has so many schemes for the underprivileged but unfortunately a lot of money gets siphoned off. But with UID in place, the entire amount can go directly to the right beneficiary. Judicial accountability long overdue August 21, 2012: The Judicial Standards and Accountability Bill, 2012, already passed by the Lok Sabha on March 30, and now awaiting approval of the Rajya Sabha, has recently been pitchforked into prominence by the expression of certain reservations by the Chief Justice of the Supreme Court, S.H. Kapadia. His predecessors, J.S. Verma and V.N. Khare have also since spoken in his support. They have no objection to the inclusion of judicial standards in the Bill. Actually, the Supreme Court itself, when J.S. Verma was the Chief Justice, formulated, in 1997, a Restatement of the Values of Judicial Life which was formally ratified and adopted by the Supreme Court and the High Courts at the Chief Justices' Conference held as early as in 1999. All that the Bill does is to give statutory recognition to the charter already made binding on the judiciary by the Conference, and to provide for any deviation or violation to be treated as judicial misconduct for which the Judge concerned will become answerable. Originally, the Bill, in line with the recommendation of the Parliamentary Standing Committee on Law and Justice, had incorporated a clause to the effect that "No judge shall make unwarranted comments against the conduct of any constitutional or statutory institution or officials at the time of hearing matters in open courts during the course of hearing matters." WRONG SIGNALI, for one, am all for this stipulation. As I put it in my column published in this paper on May 11, 2011: "Judges in India are speaking too much, far, far too much, from the Bench during hearings, unburdening themselves far too long-windedly on the merits of the case while the hearing is proceeding or even at the admission stage…. as if they are handing down impromptu verdicts… liberally sprinkling their comments with harsh expressions detracting from the majesty of law…. This causes demoralisation among parties to cases, and raises doubts in the public mind about the cases getting a fair and impartial hearing." However, faced with the criticism that the clause was tantamount to "gagging" judges, the Government has since decided to drop it. I wish it hadn't. The fear voiced by the present and former Chief Justices of the Supreme Court relates to the provision which enables any individual to make a complaint against any Judge. No doubt a Scrutiny Committee will be set up to examine each complaint for its genuineness, but unfortunately a wrong signal has been sent by the reduction of punishment for frivolous and vexatious complaints from rigorous imprisonment of up to five years and fine of up to Rs 5 lakh (as in the original version) to simple imprisonment of one year and a fine of Rs 50,000 (as finally passed). Once the Scrutiny Committee finds a complaint acceptable on merits, it will be referred to an Investigation Committee for a regular inquiry and an Oversight Committee will, based on the findings, decide either to drop the case, or issue a warning to the Judge or advise him to voluntarily resign, or recommend to the President his removal from office in accordance with the Constitution. SERIOUS OMISSIONThe panel to scrutinise complaints will be constituted in the Supreme Court and every High Court, comprising a former Chief Justice and two sitting judges. The Oversight Committee will consist of a retired Chief Justice of India as the Chairperson, a judge of the Supreme Court, a Chief Justice of the High Court, the Attorney General for India, and an eminent person appointed by the President. The Investigation Committee will be set up by Oversight Committee if the Scrutiny Panel recommends an inquiry into a complaint. Absence of any provision laying down the composition of the Investigation Committee and qualifications of its members is a serious omission which needs to be rectified. The issue of judicial accountability and maintenance of judicial standards is of such vital importance that it is imperative for the Government and the Judiciary to see eye to eye in all respects concerning the Bill, if its implementation is to be smooth and harmonious. Minister of Law Salman Khurshid, and Chief Justice of the Supreme Court S.H.Kapadia, who are both public-spirited persons with the nation's interest at heart, can even now have a fresh round of discussions in order to effect improvements to mutual satisfaction.
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