Lodha breach of trust case to continue: SC

The Supreme Court today allowed the trial of RS Lodha and his three associates to continue in a Kolkata court for breach of trust, forgery and cheating in connection with the will of Priyamvada Birla. The criminal complaint was filed by an employee of the Birla group.

"It is premature to discharge the accused persons by holding that there was no evidence against them," a Bench consisting of Justice BP Singh and Justice SH Kapadia stated.

When the trial started, Lodha and his associates moved the Calcutta High Court to quash it. But the court dismissed their petition. Two of the accused, SN Prasad and V Gauri Shanker, then moved the Supreme Court in appeal. Lodha, who is the main beneficiary in the will, himself did not move any appeal. But today's judgment will cover his trial too.

The Supreme Court stated that the question of breach of trust would be determined on the basis of evidence produced before the criminal court. The prosecution cannot be denied the opportunity to prove its case through cogent evidence.

The court further clarified that it was not expressing any opinion on the merits of the case, which would be decided by the trial court.

The complaint was filed in Kolkata's Alipore court by Rajendra Prasad Pansari, an MP Birla group employee since 1977. He accused Lodha, a chartered accountant, and his associates, of having committed fraud by drafting the will in Lodha's favour.

After the death of Priyamvada Birla in July 2004, it was "found" by him that "Lodha had criminally conspired with other accused persons" and misappropriated property worth Rs 2,400 crore vested in five trusts meant for charitable purposes.

Reacting to the Supreme Court's verdict, BK Birla said, "I am happy with the judgment. I have full trust in the Indian legal system."

NG Khaitan, solicitor of the Birlas, said at a press conference in Kolkata that Lodha and his associates should resign from MP Birla group companies, as well as from charitable trusts and institutions run by the group, adds our Kolkata bureau.

Debanjan Mondal, solicitor of the Lodha camp, said, "The Supreme Court categorically stated that the court was not making any findings and that all contentions advanced by the parties would be left open to be urged before the appropriate forum. It is neither a setback for us, nor a victory for the opposition."

Khaitan said the Birlas would appeal to the Alipore court to speed up the criminal proceedings, and if possible, set up a fast-track court for it as well.

"MP Birla's properties are for charitable work and should be used only for charity. Property worth Rs 2,400 crore, vested in the five trusts and charitable institutions, has been valued at over Rs 5,000 crore," said Khaitan.

Asked who should run the MP Birla group, he said, "Our application for appointing an administrator to the company is already pending before the Calcutta High Court."