The PIL seeks to quash recent circulars by RBI regulating the number of free ATM transactions in six metros from 1st November
The Madras High Court has issued notices to Reserve Bank of India (RBI) and Indian Banks' Association (IBA) over the recent limitations on automatic teller machine (ATM) transactions.
Hearing a public interest litigation (PIL), a division bench comprising Justice V Dhanapalan and Justice VM Velumani ordered notice to RBI's Principal Chief General Manager and the Chief Executive of the IBA returnable within three weeks.
The PIL filed by Tamizharasan, an advocate seeks to quash the recent circulars by the central bank regulating the number of free ATM transactions in six metros from 1st November.
In his petition, Tamizharasan, submitted that at a time when the customers started using 1.60 lakh ATMs across the country, leading to drop in the crowd in bank branches, RBI had issued the circular based on representation from a few banks without considering the benefit for the public at large.
The change, as per circular issued by RBI on 14 August 2014 (with clarifications on 10 October 2014), would limit the total free transactions, including non-financial, at other bank ATMs to three from the existing five. However, if the transactions were carried out in places other than the six metros, the number of free transactions would continue to be five.
By passing the above circulars, the RBI had taken a stand in support of select banks. The rationale behind installing more ATMs was to help the common man, the petitioner said.
Besides ensuring better and quality service, the banks would also immensely benefit as their service is availed by the customers and flow of money is healthy.
The circulars affected professionals, disabled persons, destitute and elderly people. It would also affect the banks' deposits as the customers would withdraw more money in limited transactions through ATMs, Tamizharasan contended.
"As we lived in a fast paced society with increasing mobility and unexpected demands, the banks should help the customers. The circulars were a regressive step and need to be quashed," he submitted.
The RBI's new guidelines are applicable for bank customers in six metros of Delhi, Mumbai, Chennai, Kolkata, Hyderabad and Bangalore.
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The Shroff brothers and partners, Shardul and Cyril, are involved in the one of the most public family battles in recent time. Both have agreed to mediation in the dispute over their mother Bharati Shroff’s stake in Amarchand & Mangaldas, India’s largest law firm
One of the most public family battles in the recent past, the Shardul versus Cyril battle will decide the outcome of India’s biggest law firm. With exclusive access to Shardul’s plaint as well as the late Bharati Shroff’s Will, we bring to you a detailed timeline of the events that have transpired so far.
13 October 1994: Suresh A Shroff, founding partner of Amarchand & Mangaldas & Hiralal Shroff & Co. (AMHS) and M/s Suresh A Shroff & Co, passes away. He leaves behind his wife, Bharati Shroff and two sons, Cyril Shroff and Shardul Shroff, all lawyers.
Bharati Shroff has 35% share in AMHS.
2 May 1995: Amarchand & Mangaldas & Suresh A Shroff & Co (AMSS) is constituted by a Deed of Partnership to include outsiders into the family Partnership.
Bharati Shroff has 22.5% share in AMHS
26 March 2001: The firm continues under an “Amended and Restated Partnership” executed by the then 13 Partners of AMSS including & ‘non-Shroff’ Partners i.e. MP Bharucha, Alka Bharucha, Sharad Prabhakar Mathkar, Nitu Potdar, Ritu Bhalla, L Vishwanathan, V Umakant and Ajay Roy.
Partnership Deed also established a Management Committee.
26 March 2001: A Family Framework Agreement (FFA) is executed amongst “A-Class” Partners of AMSS to establish principles of inter and intra family equality. “A-Class” Partners include Bharati Shroff, Shardul Shroff, Cyril Shroff, Pallavi Shroff and Vandana Shroff.
The FFA provides guidelines on nominations to the Management Committee and other family matters.
Under the FFA, Bharati Shroff’s share in the partnership is to be devolved equally. (Eventually leading to legal question as to which document would prevail – the FFA or the Will).
1 June 2012: Bharati Shroff executes her Will. Elder son Shardul Shroff appointed sole executor and trustee.
Quoting the Will:
“I have made a conscious decision not to appoint Cyril Shroff as a co-executor of my Will….and I direct that Cyril and Vandana and his family be totally kept out of the management of my Estate…In my lifetime Cyril had confiscated my fiduciary powers, my powers of signing cheques etc. in the affairs of the firm.”
Estate of Bharati Shroff includes
(a) 35% share in Amarachand & Mangaldas & Hiralal Shroff & Co (AMHS), which has substantial immoveable properties and also the holder of the Brand, “Amarchand & Mangaldas”.
(b) 22.5% share in Amarchand & Mangaldas & Suresh A Shroff (AMSS) represented by 52,000 Founder Family units.
(c) Fully paid 36,226 Class A shares of face value of Rs1/- each in the capital of Amarchand Tower Property Holdings Pvt Ltd (ATP)
(d) Properties and jewellery owned by the family
Under the Will, Shardul and Cyril can each purchase half of Bharati Shroff’s shares in AMSS and AMHS. The money they pay for the shares will go to Bharati Shroff’s charitable organisations.
Same principles as applied in AMSS and AMHS to be applicable in the case of ATP; and non-payment by Shardul and Cyril would mean ATP shares to vest in her Trusts.
Quoting from the Will
“I am quite fed up with Cyril’s irrational behaviour – however, for the sake of and with the hope that Shardul and Cyril will still continue to remain joint in the professional practice…I have taken a positive decision that Cyril shall pay and so shall Shardul for acquiring my shares in the two firms and ATP.”
However, Bharati Shroff has bequeathed all her personal properties to Shardul Shroff including the family deity.
“Cyril does not trust me and I do not trust Cyril. It is a very pitiable relation between mother and a son that we lived with since 2003 onwards.”
“I want to make it clear that if for any reason or in any manner any aspect of the Will is disputed by Cyril or by any other member of his family, then none of her properties shall devolve on Cyril and his family but shall instead be bequeathed only in favour of my elder son Shardul Shroff except those properties which I have expressed in the Will to be bequeathed to my Trusts.”
25 January 2014: Codicil executed under which Bharati Shroff disinherited Cyril and his family entirely.
Quoting from Codicil:
“After execution of my last will, in the past two years much has happened, which has disturbed me to the core…I have been pushed aside and the treatment meted out to me by Cyril, his wife and children is as if I do not exist. I am deeply hurt.”
“I have come to a decision that if they have no value and respect for me, it is best that I cut them off and exclude them totally from all inheritance from my assets. I do not desire to give them anything at all.
I do know that I have been unfair to Cyril because of his and his family members’ arrogance and selfish arrogant behaviour towards me. But they have crossed all boundaries.”
24 August 2014: Bharati Shroff dies in Mumbai.
10 September 2014: Sealed bag containing testamentary documents opened in Delhi in the presence of Shardul Shroff, James Abraham, former Partner at BCG Consulting (Defendant 4 in the suit) and Vikram Bhalla, representative of BCG, with Cyril Shroff’s consent.
10 September 2014: Shardul Shroff delivers to Cyril Shroff a sealed envelope containing copies of testamentary documents.
19-22 September 2014: James Abraham, on behalf of Cyril and Vandana Shroff opens dialogue with Shardul Shroff.
Elder brother claims he is agreeable to a reasonable solution to settle family disputes.
20 September 2014: Shardul sends email to James Abraham, offers Cyril Shroff 50% of his mother’s share in the two firms and ATP subject, however to (a) Cyril and family confirming that they have no dispute to any aspect of her will and codicil and (b) Cyril’s willingness to make the payment as per terms to her estate for obtaining and purchasing 50% of her share in the two firms and ATP.
9 October 2014 (Disputed by Cyril): Shardul claims that Cyril did not accept the offer. However, Shardul made it clear that he still remained open to a reasonable solution after the Testamentary Dispositions had been implemented.
According to sources, HDFC Chairman Deepak Parekh and Birla group’s Chairman Kumar Mangalam Birla were also involved in the mediation process between the two brothers before the matter reached the Bombay High Court.
16 October 2014 (Disputed by Cyril): Shardul claims defendants collaborated with each other, Cyril and Vandana Shroff to appropriate to 50% of Bharati Shroff’s partnership share in AMSS, and also her share in AMHS.
17 October 2014: Cyril sends e-mail to Shardul in relation to ATP saying 18,113 Class-A shares in ATP are to be registered in the name of Cyril and Vandana Shroff. Remaining 18,113 shares in the name of Shardul and his wife, Pallavi Shroff.
19 October 2014: Shardul objects to these acts and asks that status quo is maintained.
5 November 2014: Legal counsel for Shardul, Bharucha & Partners write to Cyril and other Defendants, seeking confirmation that status quo is maintained.
6 November 2014: Shardul replies, says any distribution/ reallocation will be kept in abeyance.
11 November 2014: James Abraham and Gerald Goulding acting as “independent” members of the Management Committed write to Shardul; they say Management Committee has no interest in the estate of Mrs Shroff.
They also claim a circular is passed by resolution, allowing partial devolution of Bharati Shroff’s estate to Cyril and Vandana Shroff.
Shardul replies, by questioning the Management Committee’s decision. Abraham suggests discussion, albeit with preconditions. Preconditions rejected by Shardul.
12 November 2014: L Vishwanathan sends email to Shardul Shroff, says Management Committee should implement the resolution. Cyril, Abraham also provide legal opinions from senior counsels Abhishek Manu Singhvi and Virag Tulzapurkar.
Shardul replies, refuting these contentions.
Cyril informs Shardul that nothing will be done against the directions mentioned in Bharati Shroff’s Will (Disputed by Shardul).
Counsel for Cyril Shroff, Iqbal Chagla would later tell the Court that this fact has been suppressed.
14 November 2014: Shardul moves Bombay High Court for probate, injunction against Cyril and six others. Cyril Shroff and other defendants served with notice at 6.20pm.
15 November 2014: Vandana Shroff tells Bar and Bench,
“We are shocked. We are trying our best to make sure that clients don’t suffer and it’s business as usual. We will deal with things as and how things unfold.”
18 November 2014: Matter listed before Justice RD Dhanuka in Bombay High Court. P Chidambaram appears for Shardul Shroff, Iqbal Chagla for Cyril and Vandana Shroff. J Sagar Associates briefed Darius Khambata for James Abraham and George Goulding, DSK Legal represents L Vishwanathan.
Mediation suggested and accepted after two-hour long battle in which Cyril’s counsel Iqbal Chagla alleges that Shardul was deeply involved in the preparation of Mrs Shroff’s will and that the partnership deed and FFA should prevail over the will.
31 December 2014: The Court appointed mediators Justice BN Srikrishna, Harish Salve and Nimesh Kampani to complete proceedings.
19 January 2015: The next date of hearing is 19 January 2015.
Will all this lead to a split? According to sources in Mumbai, the firm is likely to split. One of the sources said, “It is not something that is not being talked about and the split only seems to be the way forward. However, only time will tell.”