Lodha claims 47% in Peerless after NCLT says share allotment to Roys 'void'

It’s face-off between the Roys of Peerless General Finance & Investment Company and Parasmal Lodha after the Kolkata Bench of the National Company Law Tribunal (NCLT) termed allotment of shares to Roys in 1988 as 'void'.

Peerless Managing Director Jayanta Roy said that the order was nothing but a stage of litigation. “It is subject to challenge which we shall certainly do. We are confident that a final verdict from the higher forum will be in our favour.”

Lodha retorted, “They must understand that the delaying tricks that they have been using for 30 years in Calcutta High Court will not work in higher forums. Fair justice will prevail.”

At the heart of the matter lie 30,000 shares of Peerless General Finance issued in 1988 to friends, relatives and nominees of the Roys. This brought down the holding of Lodha and his nominees and increased the holding of Roys to more than 50 per cent, according to Lodha.

The original petitioners in the case were Ajit Kumar Chatterjee and Arghya Kusum Chatterjee who by way of a family settlement came to own shares of Kali Kumar Chatterjee, who used to own and run Peerless with Sunil Kanti Roy.

Lodha was part of a group of shareholders that filed the petition at the time. Then, Bhagwati Developers, Lodha’s company, replaced Ajit Kumar Chatterjee in the legal battle when he died.

According to Lodha, with the NCLT ruling, his holding in Peerless would increase from 23 to 47 per cent while Roy’s holding would come down from 66 per cent to 36 per cent.

In 1988, the promoters of Peerless had bought 15,626 shares of the company from Lodha, Bhagwati Developers and other shareholders.

The NCLT has declared issuance and allotment of the shares as null and void and the holders have been directed to return the shares, bonus shares and accrued dividend to previous shareholders i.e. transferors within 30 days. Lodha puts the value of accrued divided at Rs 250 crore.

The 32-year legal battle that was started by a group of shareholders is largely being spearheaded by Lodha now.

Parasmal Lodha

It’s not unusual for Lodha to make headlines – by his own admission it has often been for the “wrong reasons”.

Lodha entered the real estate business in the early 1980s and quickly earned the nickname “Extra Floor Lodha”. His specialty was squeezing in extra floors in buildings in lieu of roof rights –  an idle asset for the owner.

He had agreements with the owners of many big buildings in Kolkata. The iconic ones were Tobacco House, Bagree Market, Stephen Court in Kolkata.

“I wanted to enter the real estate business but had no money to buy land. So I came with the novel idea of buying the roof and adding extra floors,” Lodha said.

The onus of getting the legal stamp was on Lodha. Was it due to his political connections? “Some people liked me,” he admitted.

In the 1990s, he was in the public eye for Peerless. But the last time he was under spotlight was in 2016 when he was taken into custody by the Enforcement Directorate (ED) for allegedly converting over Rs 25 crore in banned currency into new notes.

He was in custody for three months. Lodha claims that the case is almost over.