9:26 pm - Friday November 6, 2015

Bombay HC grants partial relief to Vijaypat Singhania

22 Viewed Alka Anand Singh Comments Off on Bombay HC grants partial relief to Vijaypat Singhania
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Mumbai: The Bombay high court on Friday said Vijaypat Singhania, chairman emeritus of Raymond Group, can transfer his shareholding in Raymond Ltd to his son Gautam Hari Singhania. Vijaypat’s 37% stake in the group company is worth more than Rs.1,000 crore.

The court, however, said claims made by some of Vijaypat’s grandchildren on his wealth will continue to be heard.

While this is a relief for Vijaypat, it does not put an end to the family dispute.

The order follows the line that Justice G.H. Patel took at a 29 July hearing, when he warned Madhupati Singhania, Vijaypat’s elder son, against firing from his children’s shoulders. The children, though, can appeal to another bench of the high court.

The dispute centres around a family agreement of 1998. In December 1998, Madhupati Singhania (56), severed ties with the family, left his ancestral home in Mumbai and moved to Singapore along with his wife Anuradha and four children—Ananya (29), Rasaalika (26), Tarini (20) and Raivathari (18).

Before he did this, Madhupati entered into a family agreement, under which he relinquished his rights, as well as those of his children, to the family property. Soon after his exit in July 1999, Gautam Hari, 49, Vijaypat’s younger son, was elevated to the position of managing director of Raymond.

Now Madhupati’s children are claiming their share of the property.

On 9 February this year, Vijaypat announced that he would gift his 37.17% stake in flagship company Raymond Ltd, worth almost Rs.1,041 crore, to his son Gautam Hari. In a statement issued to the exchanges, a rationale was offered—that this would help in maintaining the continuity of management and align the ownership interest.

So Vijaypat gifted 24,290 shares in JK Investors (Bombay) Ltd and 9,996 shares in Smart Investments Pvt. Ltd—which collectively hold a 37.17% stake in Raymond—to his son.

Around the same time, Madhupati’s children filed a case against their grandfather.

In the suit, the four questioned the 1998 family agreement, which they claimed ignored their rights as minors. In the petition filed before the Bombay high court, the children claimed a right to the Raymond brand, ancestral properties, real estate and other movable and immovable assets of the group.

The children stated that their parents had no right to enter into any agreement on their behalf and relinquish their claims.

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