SC refuses to stay HC move to appoint administrators for Lilavati trust

The top court, however, clarified that the high court’s observations in its May 7 order were “only prima facie” in nature and that “all the issues are left open” for further adjudication

Mumbai: The Supreme Court earlier this week refused to interfere with a Bombay High Court order proposing the appointment of a committee of administrators to oversee the trust that runs the Lilavati Hospital and Research Centre in Bandra.

The Supreme Court earlier this week refused to interfere with a Bombay High Court order proposing the appointment of a committee of administrators to oversee the trust that runs the Lilavati Hospital and Research Centre in Bandra. (HT Photo)

The top court, however, clarified that the high court’s observations in its May 7 order were “only prima facie” in nature and that “all the issues are left open” for further adjudication.

Earlier this month, a division bench of chief justice Shree Chandrashekhar and justice Ravindra Ghuge had proposed appointing administrators to supervise the functioning of the Lilavati Kirtilal Mehta Medical Trust (LKMMT), observing that its operations had been hampered by a prolonged legal battle between rival factions of the Mehta family, which controls the trust.

Permanent trustees Charu Mehta, Prashant Mehta and Rajiv Mehta then filed a special leave petition (SLP) in the Supreme Court against the high court’s order.

Arguing for the permanent trustees, senior counsel Kapil Sibal told the top court that some of the facts recorded by the high court in its order were not correct. Senior counsels Mukul Rohatgi and Abhishek Manu Singhvi, appearing for the respondents in the SLP, however, said that “by taking note of the prolonged litigation and the dispute between the parties, the high court has rightly undertaken the exercise [of proposing to appoint administrators]”.

While disposing of the SLP on May 18, a Supreme Court bench of justices MM Sundresh and N Kotiswar Singh said that all issues in the case remained open, including the high court’s observations in two paragraphs of its May 7 order. In those paragraphs, the high court had recorded submissions of the income tax department, which claimed to have found “large-scale irregularities” during searches conducted in connection with the matter.

The high court had also observed that the trustees and former trustees had levelled “serious allegations” of “large-scale misappropriation of funds” against each other, leading to the registration of criminal cases. The apex court clarified that the high court’s decision had not attained finality. The high court is expected to hear the matter further on June 12.

The trust, founded in 1978 by the late global diamantaire Kirtilal Mehta, has been mired in disputes that began in 2004 between his sons, Kishor and Vijay Mehta. Following their deaths, the litigation continued between their descendants, who continue to fight each other in various courts.

In the matters pending before the high court, as many as 13 judges had recused themselves from hearing the matter, before it was eventually heard by a bench of chief justice Chandrashekhar and justice Ghuge. The bench noted that the rival parties were engaged in bitter litigation “in at least 31 matters”.