Chhabria's credibility in India has been put to test with various charges levelled against him and his group company, Shaw Wallace. The allegations range from concealment of income by the Income Tax authorities to foreign exchange violation by the Enforcement Directorate.
The company's unions have also alleged siphoning off of funds and other major financial irregularities. These are being investigated into by the Department of Company Affairs and the Company Law Board.
This week is, therefore, a crucial one for Chhabria and his Indian operations. The allegations of gross misappropriation of funds by the Chhabria-controlled management of Shaw Wallace will come up for a second hearing before the Company Law Board on September 24.
The day will also witness another hearing by the Appellate Authority on Industrial & Financial Reconstruction (AAFIR) on the question of group company, Genelec India's merger with Shaw Wallace.
The merger plan of two companies has been put on hold following a petition by GEC to the AAIFR against the equity-swap ratio. GEC feels that the exchange ratio of 1:10 will put the company, which still holds an eight per cent-stake in Genelec, at a loss.
Chhabria also has to address another crisis that the group's liquor major is facing at present - the flight of top professionals from Shaw Wallace's ranks. Key executives, who have already left or have put in their papers, include P Swaminathan, vice president (consumer products division), Sujit Sen, vice president (HRD & IR), Dipak Mitra, vice president (legal), and I Sadasivan, vice president (finance). To add to this, Hong Kong Bank has severed links with its consortium of banks.
Top officials from Manu Chhabria companies were unable to provide a definite answer onwhether the Jumbo group chairman will come to India next week. Meanwhile, attempts to get in touch with Shaw Wallace managing director Ravi Jain and two other executive directors in Mumbai, Calcutta and Delhi failed. We do not have any immediate information on the matter, Dunlop sources said.
Officials of the law enforcement agencies, when asked whether they will interrogate Chhabria if he comes to India, said, It is a million dollar question, we are keeping our fingers crossed.
If, however, Chhabria fails to turn up for Dunlop's annual general meeting, the event will have to be entirely handled by the tyre major's managing director Murli Dhar Shukla. Dunlop, over the last year, despite a 39-day closure at its main factory at Sahaganj, has turned out to be the only stable performer in the Chhabria group of companies.
In spite of a severe cash crunch, and bankers turning down an appeal for increasing the working capital limit, the tyre major has trebled its net profit to Rs 39 crore. /BODY>
