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Apex court keeps Lodha on hook

THE SUPREME Court on Friday upheld the criminal case against R.S. Lodha and his three associates, Shivnath Prasad, V. Gourishankar and Sushil Kumar Daga. Lodha and his associates have been charged with forgery, cheating, conspiracy, criminal breach of trust and destruction of evidence to grab the Rs 2,400-crore estate of M.P. Birla Trusts by a will purportedly made by Priyamvada Birla in 1999. The offences are punishable by seven years in jail.

india Updated: Feb 04, 2006 01:57 IST

THE SUPREME Court on Friday upheld the criminal case against R.S. Lodha and his three associates, Shivnath Prasad, V. Gourishankar and Sushil Kumar Daga.

Lodha and his associates have been charged with forgery, cheating, conspiracy, criminal breach of trust and destruction of evidence to grab the Rs 2,400-crore estate of M.P. Birla Trusts by a will purportedly made by Priyamvada Birla in 1999. The offences are punishable by seven years in jail.

Justices B.P. Singh and S.H. Kapadia shot down two SLPs filed by Prasad and Gourishankar for quashing the proceedings and said: "Questions of Trusts need to be fully inquired into on evidence by the trial court. Only a few witnesses have been examined. Therefore, it would not be possible to discharge the accused on the ground the dispute was of civil nature."

The judges upheld the judgment of the Calcutta High Court, which had said: "The statement of the witnesses and evidence annexed to complaint filed by R.P. Pansari prima facie constitutes offences. The complaint cannot be said to have been filed malafide, maliciously or to wreak vengeance on the accused out of personal grudge. Therefore, continuation of criminal proceedings will not amount to abuse of process of law." Lodha and his associates will have to appear personally before the Alipore chief judicial magistrate on March 3 and apply for bail.

"I feel vindicated that the apex court has upheld my complaint. I am sure that truth will prevail and Lodha and his associates would be convicted," Pansari told reporters in Kolkata.

Terming Lodha's conduct as a black spot on the auditors' profession, Birlas' solicitor N.G. Khaitan said: "Morality demands that Lodha and his associates should quit from all the companies and charitable institutions of the M.P. Birla group until they are acquitted by the court."

Accusing Lodha of playing hide-and-seek in court, Khaitan said: "Lodha, the main accused, claims to be a confidant of Priyamvada Birla but did not come before the court. He sought quashing of proceeding against him through his associates."

Acting on a complaint lodged by Pansari, the honorary secretary of M.P. Birla Trusts, on October 5, 2004, the Alipore CJM had issued summons to Lodha and three associates asking them to appear personally to answer the charges.

Prasad moved the High Court, which refused to quash the proceedings on July 1 last year. Prasad then appealed to the apex court. Gourishankar followed him.

Countering the SLPs, Birlas' advocates Ram Jethmalani and Y.J. Dastoor told the SC that in 1988, M.P. and Priyamvada Birla had made five "irrevocable" public charitable trusts and three public charities and vested their entire estate to them. Lodha, Prasad and Gourishankar were also the trustees of these trusts and charities.

"But Lodha revoked such trusts on April 15, 1999, and lied to Priyamvada that he was preparing a document for giving away her properties to public charities, but fraudulently prepared her purported will after three days to transfer the trusts properties in his favour. The only evidence of revocation is a letter written to Income Tax authority on June 27, 2000," Jethmalani had said.

But by suppressing facts of these trusts and charities, Lodha filed a petition in the Calcutta High Court for probate of 'forged' 1999 will for delivery of public trusts properties in his favour, Jethmalani had said.

Countering Lodha's plea, Jethmalani had said: "When Lodha himself told the court that he was a trustee of M.P. Birla group trusts but such trusts were void, he should be sent to jail without any trial. Such claim itself amounts to breach of trust. "

Attacking Lodha's conduct, Jethmalani had said: "It is a case of grossest criminal breach of trust by an auditor, Lodha, by misusing his fiduciary relationship with his client, Priyamvada. Lodha and his associates are the persons who should be locked up in jail. The complaint has been filed to protect the property given to the public trusts."

Since Prasad, Gourishankar and Daga supported the acts of Lodha, they were equally guilty of criminal breach of trust, Jethmalani had said.

If this matter is placed before the jury, Lodha will be convicted within ten minutes, he had concluded.

Jethmalani was assisted by Mahesh Jethmalani, Gauri Rasgotra and Shyam Sarkar.

First Published: Feb 04, 2006 01:57 IST