While a 74-year-old man from Kochi says he is fighting a battle to reclaim his stake — allegedly amounting to Rs1,448.5 crores — in a company that he and his family members invested in 43 years ago, the company has now denied this claim and said that the shares were sold by the family in 1989.
A report in The New Indian Express report said that in April 1976, Babu George Valavi with his four other relatives bought 3,500 shares in Udaipur-based Mewar Oil & General Mills, a company that used to make edible oils at the time. Later, the company changed its name to Pi Industries and expanded to pesticides and other chemical manufacturing. Over 43 years, the company grew and was listed on stock exchanges and now has a market capitalisation of over Rs 50,000 crores.
The report said that over time Babu forgot about his family’s investment. When Babu’s son started managing his finances, he discovered the share certificates. They approached Pi Industries’ registrar Karvy Consultants to Demat their shares, as the company was already listed. Upon Karvy’s instruction, the family contacted the company for confirming their stake but to their shock, the company told them that the shares were transferred to other people in 1989.
Pi Industries, in response to the report, told News.18.com, “Mr Babu Valavi along with his family members had purchased 3500 shares of our Company in April 1978. The Valavi Family thereafter approached the company in year 1989, to issue duplicate shares (which is the process adopted in case original shares are lost/untraceable). The Company issued the duplicate shares to Valavi Family, after following due process and even recorded such issuance in the records as required under the law. The Valavi Family then sold all the shares held by them in year 1989. The said transfer was also recorded in company records apart from the Annual Returns of our company for the year 1988-89, which was duly filed with the Registrar of Companies, Jaipur.”
Babu has claimed that in January 2016, Rajnish Sarma, then director and now joint managing director of the company, and former general manager CHN Rao came to Kochi to meet him to settle the issue. According to Babu, they agreed that the certificates were original. However, when nothing happened even after some time passed, Babu contacted the chairman, “but he was evasive in his reply,” he told the newspaper.
Pi Industries said that their claim that officials of the company met them for a settlement was “false” and that such “a statement is a complete misrepresentation of the event”. According to the company, when the Valavi Family had approached them in 2015 regarding their claim, as a courtesy to an old distributor, two officials of our company who were on a business trip to Kerala, were requested by the chairman to meet Babu. This the Pi Industries said was to “explain and convey the factual status as per the records of the company. At no point was any offer made to Mr. Babu Valavi, however, the Valavi Family has misrepresented the meeting to allege that senior officials had reached out to him for a settlement, only to mislead the public”.
Then, the family approached the Securities and Exchange Board of India (SEBI) but the company stood on their stance. Considering the possibility of fraud by some senior officials of the company, Babu expressed hope that the SEBI investigation is not closed yet.
Pi Industries told News18.com, “We adequately responded to the VaIavi Family, informing that all shares held by Valavi Family were sold by them way back in year 1989 and that their names did not appear in the register of members of our Company. In fact, details of transferees of such shares in the year 1989, as available in our Company’s record were also provided by SEBI in response to complaint filed by them.”
Pi Industries said that the SEBI has closed all complaints filed by the Valavi family regarding the dispute in 2018, 2019 and 2021.
The company said, “However, the Valavi Family has now resorted to spreading disinformation through the media to defame our Company to exert undue pressure on us to agree to their illegal demands. Further, the Valavi Family in order to sensationalize news of their fictitious claim, have been deliberately making false statements. ”
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