Bank To Pay Rs3 Lakh for Losing Sale Deed

The Maharashtra State Consumer Disputes Redressal Commission has ordered IDBI Bank to pay a compensation of Rs3.22 lakh to Captain Vikrant Apandkar in Pune after it lost the original sale deed of his property which he had submitted while procuring a home loan in 2003. Captain Apandkar had sought the document after foreclosing the loan in 2007. The Bank had issued him a no-dues certificate, but told him that the original sale deed was lost. Apandkar said that after submitting the document as evidence for availing the loan in 2003, he repeatedly contacted the Bank to retrieve it. The Bank said that it had conducted an extensive search to trace the document. However, in 2009, the Bank changed its stand and said that the document was never submitted. Aggrieved by the last communication, Apandkar filed the complaint.

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Sensex, Nifty on a reversal path? Tuesday closing report

A close below 6,056 on the Nifty will pull the index further down

The indices on Tuesday opened in the positive, following a further upmove in the US markets and better results from Reliance Industries. However, within an hour of the Sensex, after hitting its intra day high, highest since 11 November 2010, it plunged into the red. The Nifty hit its highest since 21 May 2013, and immediately entered into the negative territory. For the remaining session, the indices tried recovering but barely managed to come in the positive in late afternoon and closed in the negative breaking five days of positive move.
 

The Sensex opened at 20,723 and moved down from 20,760 to 20,447 and closed at 20,548 (down 60 points or 0.29%). The Nifty opened at 6,148 and moved from the level of 6,156 to 6,057 and closed at 6,089 (down 24 points or 0.39%). The National Stock Exchange (NSE) recorded a higher volume of 64.13crore shares.
 

Except for Metal (up 0.73%); IT (up 0.65%) and MNC (up 0.02%) all the other indices on the NSE ended in the negative. The top five losers were PSU Bank (3.11%); Bank Nifty (2.59%); Finance (1.72%); Smallcap (1.71%) and Realty (1.58%).
 

Of the 50 stocks on the Nifty, 14 ended in the green. The top five gainers were Jaiprakash Associates (4.78%); Tata Steel (3.05%); Wipro (1.77%); Hindalco (1.72%) and Asian Paints (1.66%). While the top five losers were IndusInd Bank (4.91%); PNB (3.93%); IDFC (3.84%); Bank of Baroda (3.80%) and HDFC Bank (2.91%).
 

The stock market will be closed on Wednesday 16 October 2013 on account of Bakri Id.

The annual rate of inflation based on the combined consumer price index (CPI) for urban and rural India rose 9.84% in September 2013 higher than 9.52% in August 2013. The CPI inflation for rural and urban areas for September 2013 rose 9.71% (y-o-y) and 9.93% (y-o-y) respectively. Inflation rates (final) for rural and urban areas for August 2013 were 8.93% and 10.32% respectively. The headline CPI (combined) has seen a rise of 1.19% (m-o-m) in September 2013. A higher inflation virtually seals the case for a rate hike on October 29th RBI policy, says BoA Merrill Lynch (BoA ML) in a research note. (http://www.moneylife.in/article/higher-inflation-seals-rbis-25bps-repo-rate-hike-says-boa-merrill-lynch/34882.html )
 

The Central Bureau of Investigation (CBI) on Tuesday filed a first information report (FIR) against Aditya Birla group chairman Kumar Mangalam Birla, his firm Hindalco Industries Ltd and former coal secretary PC Parekh in the case related to the allotment of captive coal blocks between 1993 and 2010.
 

The US indices closed in the green on Monday. Senate Majority Leader Harry Reid, who said on the Senate floor on Monday, 14 October 2013, that he is very optimistic about concluding a deal this week to raise the debt limit as well as end the government shutdown. Sen. Mitch McConnell, the Republican minority leader, said he shared Reid's feeling that "we'll get a result that's acceptable to both sides."
 

US Senate Democratic and Republican leaders said yesterday they made significant progress toward an accord. President Barack Obama postponed a meeting with Congressional leaders to give lawmakers more time to reach an agreement.
 

Politicians in the US are working on a proposal to suspend the debt ceiling through February 7 and fund the government until January 15, a person familiar with the talks said. The U.S. will not default, former Treasury Secretary Lawrence Summers said.

Asian indices ended mostly in the green. Shanghai Composite, lone loser, down 0.19%. Taiwan Weighted, top gainer, 1.14%. Stock markets in Singapore, Indonesia, Malaysia and the Philippines were shut for holidays. European indices are trading in the green. US market opened lower.
 

UK annual inflation rate as measured by the consumer price index was 2.7% in September, unchanged from August. The “core” inflation rate, which strips out volatile items such as fuel and food, rose from 2% to 2.2%. The single largest upward contribution came from air fares. Conversely, petrol and diesel prices fell 0.2% between August and September, compared with a 2.7% increase in the same two months of last year.
 

Separate data from the Office for National Statistics showed that UK house prices have hit a new high, passing their previous peak set in January 2008.

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The rapidly changing nature of AGMs

Annual general meetings, the platform of minority shareholders to discuss views, suggestions and grievances with company management, are now in danger of becoming irrelevant or taken over by environmentalists


An institutional investor recently tweeted about the August annual general meeting (AGM) of DCM Shriram Consolidated Limited. One of the items on the agenda was: “Various shareholders desired that the company should discontinue the distribution of snack boxes at AGMs as some shareholders are indulged (sic) in the trading of these snack boxes.” There was no explanation about how this astonishing trading takes place and whether it occurs at the AGM itself—but the resolution to discontinue snacks was apparently put to vote and ‘passed unanimously’.

Even for those of us who spent years of our rookie reporting days covering AGMs of companies, the ‘trading of snack boxes’ was a new one. We are used to shareholders fighting for first row seats, berating textile companies for discontinuing discount coupons, complaining about the samosas or ice cream served, asking Ratan Tata to get married to ensure succession at Tata Sons, reciting specially composed poems in praise of management or bursting into song and demanding company visits. It was only in the middle of big takeover battles or after a significant scam that one saw some serious questions posed to the management. The most famous of these were in the 1980s which saw a series of hostile takeovers and subsequent fading of blue-chip boxwallah companies such as Gammon India, Shaw Wallace, Best & Crompton, Hindustan Dorr Oliver or Genelec. There were even more volatile AGMs of Reliance Industries and Bombay Dyeing during their famous war. And, there were serious discussions at AGMs in the 1990s as Ratan Tata systematically got rid of satraps such as Russi Modi, Ajit Kelkar and, less acrimoniously, Darbari Seth and Nani Palkhivala.

Once the non-management shareholding began to be dominated by foreign institutional investors (FIIs) in the 1990s, AGMs lost their relevance. Most important interactions and discussion shifted to analyst meets and retail investors became completely irrelevant. That is the reality even today and is reflected in the halving of India’s retail investor population over the past 25 years from 20 million in 1992.
 

Express AGMs
 

Will serial annual general meetings, being completed in a flash, become a trend? This will only further undermine shareholders' rights to air their views


If  you were to look at some milestones to mark the extraordinary irrelevance of retail investors in India today, you only need two examples.

On  20 May 1985, Dhirubhai Ambani, credited with creating an equity cult in India, held the AGM of Reliance Industries Limited (RIL) at the Cooperage football grounds in Mumbai. It was attended by 12,000 shareholders.

On 30 September 2013, Indiabulls, a group that powered on to India’s business landscape just about a decade ago, chose to hold the AGMs of six group companies in a row with just a perfunctory 15 minutes for each company—Store One Retail India Ltd, Indiabulls Wholesale Services Ltd, Indiabulls Securities Ltd, Indiabulls Power Ltd, Indiabulls Real Estate Ltd, Indiabulls Infra and Power Ltd.

The company claimed that 80% of the shareholders are common to all companies. But still, 15 minutes each would be barely enough to have statutory resolutions passed by shareholders such as appointment of directors and auditors or to ratify corporate actions. Earlier, on 8th August, the Adani group held AGMs of three companies—Adani Ports, Adani Power and Adani Infrastructure—45 minutes apart.

Newer business groups have no time for carefully crafted chairman’s speeches; forget about the oratory of chairman Nani Palkhivala who had shareholders flocking to ACC Ltd’s meetings just to hear the legendary jurist.  The more established groups still continue to treat investors and AGMs with a modicum of seriousness, but nothing underlines the irrelevance of the retail shareholder more than this trend of express-AGMs for an entire group of companies.

But, hold on; another interesting new development is taking place with companies that plan large projects that adversely affect the environment. They need to gear up to face a bunch of informed activists, who are unconcerned about the quarter-on-quarter performance, but more interested in environmental damage caused by industry.
 

AGMs: The new battleground

 

Environmentalists are now donning shareholders' clothes, to question environmental policies of companies. Greenpeace is an example of this. Do they really represent investors' interests?


While Gautam Adani may have hoped to wrap up three AGMs in quick succession on
8th August, he probably did not expect to be confronted by a savvy set of new shareholders. Greenpeace, the powerful and well-funded global NGO, which does not hesitate to take on the biggest companies in the world, had its campaigners buy shares of Adani to be able to attend the AGM and question the management on environmental policies. Adani was not the only company to find itself in a spot. In the same month, Greenpeace campaigners used the same strategy to confront chairman Dr GVK Reddy of GVK Power & Infrastructure (GVKPIL) over the company’s $10 million investment plan in Australian coal projects which were facing angry protests from environmentalists. The NGO did not limit its questions to the environment and has probably succeeded in pushing GVK on the back foot.

Then, in September, Greenpeace released a report, which challenged Coal India’s claims about its reserves and said they were fast depleting. Predictably, the Coal India chairman angrily dismissed the NGO’s claims at the AGM that happened soon after. But this new breed of shareholders isn’t going away. They have already lodged a formal complaint with the Securities & Exchange Board of India (SEBI) and have already bought shares in Coal India in anticipation of a long battle.

This is not corporate India’s first brush with Greenpeace. In 2008, Tata Steel had sued Greenpeace, seeking to prevent its campaigners from attending a Tata Steel AGM. It didn’t work and the activists succeeded in asking Ratan Tata, at the AGM, to withdraw from the eco-sensitive Dhamra port project in Orissa. Vedanta plc, the flagship company of the Anil Agarwal group, is routinely embarrassed at its AGM in London by a clutch of high-profile NGOs who also manage to rope in celebrity protestors for maximum impact.

In 2008, a high-profile campaign through emails and social media was targeted at Nestlé, asking it to stop using products that led to destruction of rainforests. Under the relentless barrage of emails and bad publicity generated by the KitKat campaign, the company made peace and agreed to change its sourcing strategy.

In the days before demat trading, companies used to make it a point to refuse to transfer shares, if the purchasers were perceived as ‘trouble-makers’ who asked uncomfortable questions at shareholder meetings. They can no longer do so now and a group of organised investors can buy just one share each to be able to attend general body meetings. If they manage to catch the management by surprise, they may even be able to swing decisions at these meetings. Unfortunately, these activists/shareholders do not represent investor interest. They are unconcerned with profits or dividends; their main interest is corporate social responsibility. Greenpeace has made a beginning by targeting Adani, GVK, Tata Steel and Coal India; if its interventions at general body meeting force management to engage with them or reconsider their policies, we may see a lot more of such action in future.

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COMMENTS

Davidson D

3 years ago

Suppose a statutory fails to report minimum reporting requirements, what action can ICAI taken against the auditor? Would it constitute professional misconduct due to negligence?

Dayananda Kamath k

3 years ago

trading in snaks box is the trend in delhi. and it is a big bsiness.once i complained to sebi also about these happening but of no avail. recently at moser bear agm the chairman was decaring the resolutions as passed on peoposing and seconding without putting it to vote. and my objection was not accepted. i have put it on my faceboo page.

Davidson D

3 years ago

There are companies which resort to back dating the postal receipts for despatch of annual accounts thereby circumventing the provisions of S. 171 of The Companies' Act. This can make the entire meeting void ab initio.

REPLY

nagesh kini

In Reply to Davidson D 3 years ago

To make matters worse the Postal Dept. accords least priority to what they consider 'heavy' mail.Invariably the Annual Reports are received long after!

nagesh kini

3 years ago

Yes Sucheta there was a time when the AGMs were dominated by a chosen few known faces with Annual Reports moving from one venue to another just to shower lofty praises on the Chairman and ask for bonus and increase in dividends.
The Indian Hotels was once handing out packed 1lb cake for each folio. There was a longer Q of old Bawas with big cloth bags carting as many cakes as possible!
When it comes to responding to questions that are perceived to be inconvenient the Chairmen invariably try to wriggle out by saying that they will be answered at the end which never happens. I've experienced this with Ratan Tata as Chairman in HCL AGM.
Re.Professional envirormental groups hijacking meetings the MCA and SEBI ought to come out with guidelines limiting the timing for raising questions.
The 15-45 "Serial AGMs" ought to be strict NO-NO.

REPLY

nagesh kini

In Reply to nagesh kini 3 years ago

Read Indian Hotels Co.Ltd.

Anil Agashe

3 years ago

This is unacceptable. Some NGOs are doing good work but many environmentalists are causing problems. We have to solve this issue quickly. Many projects are delayed by these protests already.

REPLY

Hemant

In Reply to Anil Agashe 3 years ago

I agree with you partly, as many times there are NGO's,who resist on behalf of rival co's ,under the pretext of doing good work & getting paid by rival co's.

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