Monday, August 10, 2015

Senior Congress leader Mallikarjuna Kharge under Lokayukta scanner for Disproportionate Wealth



Senior Congress leader Mallikarjuna Kharge is under Lokayukta scanner for allegedly possessing property worth Rs 50,000 crore in country’s many cities like Nagpur, Pune, Mumbai, Goa, Delhi, Mysore, Gulbarga and Chennai. Some of the properties are reportedly in the name of his sons, daughters, son in law and also wife.

B Rathnakar, Generary Secretary of Bengaluru based Samaj Parivarthan Samithi has leveled the allegation against Kharge that he has amassed wealth disproportionate to his known source of income and hence a complaint under Prevention of Corruption Act was filed against him.

Lokayukta’s Raichur wing, Bengaluru is conducting an inquiry into the matter. 

Lokayukta officials tell an online portal that they are looking into the complaint and are conducting a thorough probe of the allegations. The Lokayukta, however added that they are inquiring into the complaint and if the allegations have merit then an FIR would be filed and case registered.

The complaint has several allegations. It accuses of amassing wealth through misuse of his official position. It specifically states that he had made illegal appointments to 1,427 posts of assistant engineers and also junior engineers in a bid to fill the SC backlog vacancies. As the Revenue Minister of state from the year 1980, he has amassed a lot of wealth and while totaling the same it amounts to Rs 50,000 crore worth of property the complaint alleges.

A huge complex in Bannerghatta worth Rs 500 crore, a coffee plantation of 300 acres in Chikmagalur worth Rs 1,000 crore, a house worth Rs 50 crore, a Kengeri farmhouse of 40 acres, a building near the M S Ramaiah college in Bengaluru worth Rs 25 crore, a house in RT Nagar, 17 acre land on Bellary Road, a three-storey building in Indira Nagar, two houses in Sadashivanagar and other properties. Further, he is accused of heading several societies and got grants for them. “He had also lied on oath while filing his election affidavit”, the complaint also states.

Source: http://www.nagpurtoday.in/mallikarjuna-kharge-owns-rs-50000-cr-assets-across-cities-including-nagpur-alleges-plaint/12191422 

Tuesday, June 9, 2015

The murky details of the Essar diaries.... - MoneyLife

The Essar diaries, which are part of an affidavit filed by the Centre for Public Interest Litigation (CPIL) in the Supreme Court of India provides a rare peek into the way influence-peddling by crony capitalists actually works in India. The leak of internal emails by a whistleblower reveals that the top secret Union Budget details were available to Essar in 2012. And why not? The group has enormous funds earmarked to buy these favours. For instance, the emails reveal that Gulfstream jet was sent to Trinamool Congress leaders, including chief minister Mamata Banerjee and a few journalists, at the behest of president Pranab Mukherjee for his swearing-in ceremony.

They indicate that Essar was able to influence the pricing and tax policies of the petroleum & national gas ministry under Veerappa Moily. This is corroborated by a separate investigation and arrests in the ‘corporate espionage’ scandal about purchase of stolen classified documents from the petroleum ministry.

By now it is widely known that the Essar group runs a large public relations (PR) operation to keep key journalists-cum-fixers happy. It generously opened its purse strings to fund a global ‘think-fest’ by Tehelka allegedly as a quid-pro-quo for killing a story against it.

Yet, when successive Reserve Bank of India (RBI) governors express concern at the mountain of bad loans in the system, there is rarely any attempt to plug the brazen manipulation of the system for personal aggrandisement. At the height of Essar’s problems in 1999, the chairman of Bank of India (BOI) sanctioned a fat bailout to a group company on the eve of his retirement. Two months later, he joined the group as an advisor at a fee that was a multiple of his last salary. RBI chose to look the other way and asked no questions.

Soon, every other institution fell in line and wrote off several thousand crores of rupees worth of loans and overdue interest to several group companies.

Again, when Essar Steel defaulted on $250 million floating rate notes it had issued in 1994, it tried hard to force the government to bail it out as though it were a quasi-sovereign default. This was in 1999. Eventually, bondholders received only 24% of the face value of their investment.

One of Essar’s strategies to minimise the public impact of its financial problems is to de-list companies at a low buyback price when there is no more scope to raise funds. In 2010, Essar Energy Plc was listed on the London Stock Exchange at 420p a share.

In 2014, the group bought back the 22% public shareholding at 70p a share, unfazed by the angry backlash. It attempted to de-list Essar Oil and even sent notices to the Indian stock exchanges. Essar Shipping and Essar Ports had also informed stock exchanges that they had the required board approvals to de-list their shares. The group’s shareholders know that Essar Steel was controversially de-listed in 2007 at a low Rs48 per share. Today, when it owes Rs30,000 crore, lenders cannot even hope for an upside by converting loans to equity if commodity prices revive.

The Essar diaries, and leaks, pertain only to a small recent phase, but provide an insight into how this well-oiled system of influence has worked for the past 30 years.  Essar had struck gold with its investment in telecom and had a real chance of cleaning up its act. Instead, it only used it to start borrowing heavily again and run up even bigger debts from Indian banks and institutions.

In fact, telecom and the 2G scandal is the first time that group chairman Ravi Ruia and his nephew Anshuman Ruia are personally facing trial along with several top employees and their three telecom firms—Loop Telecom, Loop Mobile India and Essar Tele Holding. Ravi Ruia, now needs court permission to travel abroad and, on 24th May, an irritated judge asked him not to waste the court’s time with repeated and causal requests for permission.

At the end of April this year, a consortium of 24 banks has a massive exposure of Rs30,000 crore to Essar Steel alone. In May, HDFC Bank decided to take a hit and sold Rs550  crore of its outstanding debt to Edelweiss Asset Reconstruction at a 40% discount. This is a loss of Rs200 crore.

Bank of India’s auditors have asked it to classify its Rs500-crore exposure to Essar Steel as a bad loan. Among its major lenders, State Bank of India (SBI) has an exposure of Rs8,000 crore to Essar Steel and ICICI Bank has an exposure of another Rs6,000 crore.

 Essar Steel’s outstanding of Rs30,000 crore is after it was made to raise Rs4,850 crore through a sale of assets and the promoters were made to pump in Rs1,300 crore under pressure from lenders. It is interesting to note that the money that was allegedly brought in by the promoters is twice its meagre net profit of Rs648 crore in the past financial year.

When the group’s strategy itself is to live off public funding, its financial problems are not limited to Essar Steel. Essar Shipping is also making losses and has reported a consolidated net loss of Rs159.69 crore for the quarter ending 31 March 2015. Essar Ports is also out there seeking relaxed loan terms from its bankers on its existing Rs6,000 crore outstanding to banks and wants money for a fresh investment of Rs3,000 crore.

This does not include the undue benefits running into hundreds of crores of rupees that ‘friendly’ officials gave the group over the years. Here is only one instance. A 2013 report of the CAG (comptroller and auditor general of India) on public sector undertakings lists multiple counts on which Gujarat Petronet officials favoured the group and passed on undue benefits running into hundreds of crores of rupees collectively to Essar group companies—Essar Steel, Essar Power Gujarat Ltd. The amount was over Rs650 crore.

For over a year now, Care Ratings has had a ‘default’ rating on Essar Steel but do you hear the government ordering a forensic audit into how the funds were used or diverted? Any such order can only be an outcome of the Supreme Court litigation filed by CPIL. That Essar’s outstandings can wreck the profits of major banks ensures that they are again working at ‘restructuring’ its loans with tacit support from the government. This is a sordid story of crony capitalism, first leeching off public shareholders and then public sector banks.

The Modi government claims to be keeping businessmen at arm’s length. Prime minister Narendra Modi told a newspaper a few months ago that “my government will make policies, if you fit into it, come on board, or stay where you are. My job is not to spoon-feed anyone.” It is ironic that public sector banks, owned by the government, are continuing with impunity to work at bailing out businesses houses like Essar.

Author- Sucheta Dalal is the managing editor of Moneylife. She was awarded the Padma Shri in 2006 for her outstanding contribution to journalism.
Source- http://www.moneylife.in/article/what-the-essar-diaries-mean/42144.html

Thursday, June 4, 2015

Misuse of Law by a Educationally well Qualifed to claim Alimony Deprecated!

The Mumbai family court has pulled up a highly qualified woman for seeking maintenance from her estranged husband.

The court, presided over by principal judge Dr Laxmi Rao, said that the woman was trying to take undue advantage of the law and using it as a shield against her husband.
Its six-page order, given out recently, said that women cannot sit idle and expect money from former partners.

The woman in question was highly qualified, had pursued her MBA, and was working with a private firm as a human resource personnel.

 In 2014, she approached the court seeking a permanent monthly alimony of Rs 25,000 and an equivalent amount of maintenance under Section 24 of the Hindu Marriage Act. The woman claimed that she was forced to leave her job.

Her argument was that since she was not working and was dependent on her parents and her brother, she was bound to get maintenance.

Her husband, who was an engineer, earning a monthly salary of Rs 25,000, opposed her claim. He claimed that the woman deserted him in 2012, filed for divorce in 2013 and approached the court for maintenance in 2014.

For two years, she sat idle, despite being highly qualified, and this was not acceptable, he said.

The Court relied on a Madhya Pradesh High Court judgment in 2000, which had pulled up a woman, who, in spite of being efficient enough, had sought maintenance.

The Mumbai family court judge said: "According to me, Section 24 has been enacted for the purpose of providing monetary assistance to such spouse who is incapable of supporting himself or herself. If the spouse is well qualified, s/he is not expected to remain idle to squeeze out the other... The law does not expect the increasing number of such idle persons, who, by remaining in the arena of legal battles, try to squeeze out the adversary by implementing the provisions of law suitable to their purpose," the court said.

"A lady who is fighting matrimonial petition filed for divorce cannot be permitted to sit idle and put her burden on the husband for demanding pendentelite alimony from him during the pendency of such petition. Section 24 is not meant for creating an army of such idle persons who would be sitting idle waiting for a 'dole', to be awarded by her husband who has got a grievance against her and who has gone to the court seeking relief against her," concluded the order.

Source: http://www.dnaindia.com/mumbai/report-don-t-misuse-law-to-squeeze-out-estranged-huband-court-to-woman-2091027

Wednesday, June 3, 2015

CCF - Interview with Ms Gill Miller


Exclusive in-house Q&A with Gill Meller, Legal Director and Secretary of MTR Corporation

WHY DID YOU BECOME A LAWYER?

I was inspired by Portia in The Merchant of Venice
WHO HAS BEEN THE BIGGEST INFLUENCE ON YOUR CAREER?

Other than my family - who told me to be the best that I could be at whatever I chose to do in life - the senior partner of my first (and only) law firm and my predecessor as legal director at MTR would be the people I find myself quoting the most
WHAT'S YOUR PROUDEST PROFESSIONAL MOMENT?

When my team get the recognition they deserve
...AND WORST DAY ON THE JOB?

When I had to sing (in Chinese) on stage in front of 1700 people at an annual awards dinner
WHAT MADE YOU CHOOSE IN HOUSE OVER PRIVATE PRACTICE?

The tangible nature of the work and the opportunity to get involved in the business
WHAT'S YOUR STRONGEST CHARACTERISTIC...AND WORST TRAIT?

My strongest characteristics - energy, resilience and an ability to get on with people

My worst trait? That my ability to sing falls far short of my enthusiasm for singing!
WHAT ADVICE WOULD YOU GIVE TO YOUNG LAWYERS STARTING OUT?

Work hard, value experience - watch and listen to people who've done it before - and take risks in your career
WHAT'S THE BEST PART OF YOUR JOB?

The challenge - companies are constantly evolving, the legal and regulatory environment around the world is getting more complex all the time and, increasingly, the public has an expectation that companies will "do the right thing" - and we have to give advice in that context
WHAT IMPRESSES YOU MOST WHEN LAW FIRMS PITCH FOR WORK...?

An understanding of who we are and what we do, and not just by the partners - I want to meet the people who are going to be doing the work and I want them to have that understanding
...AND WHERE DO THEY MOST OFTEN SLIP UP?

By turning up late and blaming the trains...
WHAT'S THE MOST COMMON MISCONCEPTION OF IN HOUSE LAWYERS?

That we have an easy life!
MOST MEMORABLE DEAL YOU EVER HAVE WORKED ON AND WHY?

A project in India, where we had to climb over a cow to get in the office some mornings and onto the roof (through the chairman's toilet) to make international calls on a satellite phone!
DO YOU SEE YOURSELF HAVING A CAREER OUTSIDE LAW?

Never say never...
WHAT'S YOUR FAVOURITE ITEM OF CLOTHING?

If I tell you that I have a shoe cupboard in my office that might give you an idea...
IT'S MIDNIGHT AND YOU'RE IN THE OFFICE FOR THE NIGHT, WHERE'S YOUR TAKEAWAY FROM?

I try not to be in the office at midnight very often
WHAT ARE YOUR DESERT ISLAND DISCS?

Now, this is the most difficult question... I would say (in no particular order) American Pie, The Gambler (you've got to love a bit of Kenny Rogers), She Bangs the Drums (showing my Northern roots), Honky Tonk Women, You Shook Me All Night Long (sorry...), Vissi D'Arte from Tosca (to add a bit of culture), Mr Brightside and Damien Rice's The Blower's Daughter

Source http://www.ccf-hongkong.com