India Based Conglomerate Hinduja Group’s net-worth is 50 billion dollars as of 2020. The group is active in traditional sectors. Some of these are banking (Induslnd Bank), finance, energy and transport. It is now an international conglomerate with its presence in 38 countries over the world.
On June 23, 2020, UK’s Royal Court of Justice ruled in favour of Srichand Hinduja. The case was on the issue of control of Hinduja Bank, headquartered in Switzerland. This ruling was against Srichand’s 3 younger brothers: Gopichand, Prakash and Ashok.
Srichand Hinduja is the ‘current patriarch’ and chairman of the Hinduja Group. The younger 3 brothers are the co-chairmen of the Hinduja group. At the centre of this billion-dollar legal battle is a letter from 2014. Both Srichand and his daughter Vinoo sought the court of London to declare the letter void. They signed the letter on 2nd July 2014. It stated that ‘assets held in any single brother’s name belong to all four’. They had asked the Court to declare the letter as having no legal effect as a will or any other binding document. The other three brothers fought to ensure that the contents of the letter are not revoked.
What is the feud about?
A letter signed in 2014 by the 4 brothers stated that each one of them would be each other’s executor. Trouble ensued between the brothers in 2016. This was when Srichand expressed that the 2014 agreement does not reflect his wishes. He urged that his and his family’s assets must be separated. Justice Falk of the Court of Justice heard this matter.
He stated that the 3 younger brothers tried to use this letter as leverage. Their aim was to take control of the Hinduja Bank of Switzerland. The control of the bank is in Srichand’s sole name. The reason behind the feud is that the younger brothers believed that Srichand lacked the capacity to control the bank. They said that this was because he suffered from Lewy body disease. This disease is a form of dementia.
UK Court’s Decision
The defendants (three brothers) contested another fact. This was that Srichand’s daughter Vinoo represented him in court. They further argued that Vinoo has her own personal agenda in pursuing the case. They urged that an independent solicitor should represent Srichand. However, the judge ruled that “she does not have an adverse interest” in the case.
Thus, they allowed Vinoo to act as her father’s “litigation friend”. The certificate of suitability confirms this. It says that Srichand is no longer in a state to give instructions to lawyers. Hence, he has asked his daughter to do so, the court said. Further, Clifford Chance (Srichand’s law firm) sent an email on May 2, 2015. This stated that Srichand did not consider himself legally bound by the letter. A further letter from the firm dated July 24, 2015, reiterated the fact that Srichand was not bound by it. He made the same point in a letter he sent dated July 16, 2015. The Court ruled in favour of Srichand. They stated that the defendant’s contentions had led to financial disruption. This had affected both Srichand and his immediate family.
Will Srichand’s assets pass on to his daughter?
The three brothers noted that if the claim succeeds then all assets in Srichand’s name would pass to Vinoo. They would also go to her immediate family on Srichand’s death. This includes the entire shareholding in Hinduja Bank, according to the judgement.
What is at stake for the Hinduja Empire?
The Bloomberg Billionaires Index values the fortune of Hinduja Brothers at $11.2 billion. This litigation has shaken the foundation of the Hinduja conglomerate. It will definitely impact the business. The 3 brothers stated that these proceedings are against their family values. They stated that they intend to defend the claim to uphold these family values.
Another fact emerged during the hearing. The four brothers are also embroiled in litigation in Switzerland as well as New Jersey. During these proceedings, Srichand’s family consolidated their position in the Hinduja Bank. Srichand’s daughter Shanu Hinduja took over as the chairman of the bank and her son Karam Hinduja was made the CEO. The brothers have maintained that this litigation will not have any impact on their global businesses. The group will continue to function as it has been. But there could be a sentimental impact on the stock prices of these companies for the short term.
The legal fight is likely to continue between the brothers. They have already hinted that they are adamant to defend their family values. If so, a division of the Hinduja Empire is anticipated sooner or later. More so, because the next generation of the family is active in the operations of the family business.
Libertatem.in is now on Telegram. Follow us for regular legal updates and judgements from the court. Follow us on Google News,Instagram, LinkedIn, Facebook & Twitter. You can also subscribe for our Weekly Email Updates. You can also contribute stories like this and help us spread awareness for a better society. Submit Your Post Now.