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Moneylife » Investing » Fixed Income » How to get your money back from Yash Birla group companies

How to get your money back from Yash Birla group companies

Moneylife Digital Team | 24/09/2013 03:09 PM | 

Damyanti Vithalani, a Moneylife reader got her money back from Yash Birla group companies by filing a complaint to MCA portal. Those who invested in the corporate FDs of Zenith Birla (India) and Birla Power Solutions can follow her tactic to get their money back  

Moneylife has received several complaints from agitated readers and senior citizens who have not been able tot get their fixed deposit (FD) maturity amounts from Yash Birla Group companies – Zenith Birla (India) Ltd and Birla Power Solutions. Damyanti Vithalani, who fought for her refund says that a complaint to the Ministry of Company Affairs (MCA) website reached the right ears. Here is what you need to do to get your money back from the Yash Birla group companies.

  1. 1. First, you should file a complaint with the Investor Grievance Cell of the company. Many investors have not got a response to this. It does not matter, follow this step and then escalate the issue if you do not get a response. You can do this by filing an online complaint to MCA.
  2. On MCA website click on the right side menu under ‘Important Links’ click on ‘Lodge Investor Complaints’. It will provide you Investor Complaint Form. Fill in all the necessary information and submit your complaint online.
  3. While filling online complaint form on MCA website you need to enter Corporate identity number (CIN) of company. Zenith Birla India's CIN is L29220MH1960PLC011773 and Birla Power Solutions' CIN is L31101MH1984PLC032773.
  4. You can also file a case against company with the Company Law Board (CLB) under section 58A (9) of Companies Act, 1956 or under section 45QA of the RBI Act, 1934.
  5. You need to fill form no. 4 of Company Law Board Regulations and submit it with a demand draft of Rs50 to nearest CLB Bench.

Ms Vithlani managed to get her money back after filing complaints with the MCA as well as the CLB. She had invested in corporate FD of Zenith Birla India Ltd. On maturity, the company received her FD claim but they did not give any timeline for refunding the money. Later on, she filed complaint on MCA website and wrote emails to the legal team of Yash Birla group as well as the company’s board members, PVR Murthy and Vimal Dubey. She sent a copy of every email to MCA at and Ministry of Commerce (MoC). She also filed her complaint with the CLB. After following this process for a month, she received Rs6 lakh from Zenith Birla India.

Between March and June 2013, the CLB had received as many as 130 complaints against other Yash Birla group company, Birla Power Solutions.  Applicants have filed complaints under section 58A(9) of the Companies Act, 1956 as the company has failed to repay their deposits-FDs as per the terms and conditions of acceptance of deposits.

On 30 August 2013, in view of the genuine claim of the applicants and also in exercise of powers conferred under section 58A (9) of the Companies Act, 1956, CLB Member Vimla Yadav directed Birla Power, as under:

  1. The company shall make the repayment of the Fixed Deposits with up-to date interest by Demand Draft by 05 October 2013 which shall be sent by Registered Post to the said applicant depositors.
  2. The company shall examine the Pre-mature cases of the depositors in the context of hardship cases and arrange to pay those who require the funds immediately.
  3. The company shall file an affidavit of compliance with the CLB by 10 October 2013 to the effect that it has repaid the deposits to the 130 depositors. A copy of the Affidavit to be sent to the Registrar of Companies, Mumbai Maharashtra as well.
  4. Any failure to comply with this order on the part of the R-I Company shall attract the penal provisions contained in sub-section 10 of section 58A of the Companies Act, 1956.
  5. The Bench Officer shall forward a copy of this order to the Registrar of Companies, Maharashtra also.
  6. In the event of non compliance of this order, the Registrar of Companies, Mumbai Maharashtra, 100, Everest Building, Marine Drive, Mumbai-2 shall initiate prosecution proceedings against the company and its every officer including the Mg. Director of the company before 30 November 2013.

As of March 2012, Yash Birla group companies owe Rs97.25 crore to small investors invested as fixed deposit. Birla Power Solutions owes the highest, Rs57.92 crore while Zenith Birla (India) owes Rs33.19 crore to FD holders. Birla Cotsyn (India) and Shloka Infotech have collected FDs worth Rs5.67 crore and Rs52.84 lakh from investors as of March 2012. Yash Birla group companies have not yet published reports for end-March 2013.

Are Yash Birla Group companies in deep trouble? Yash Birla Group of companies has been struggling with many issues like liquidity crunch, non-payment of loans, negative cash flows etc. Most of its companies are giving negative returns to the investors and its share prices are not even in double digits.

Corporate FD’s are unsecured in nature but many investors including senior citizens like Damyanti Vithalani  invested lakhs of rupees due to the goodwill of the Prestigious Birla Group. However, Yash Birla is more known for its lavish lifestyle on Page3 parties instead of his business moves, which shows the careless attitude of the group. The promoter’s stake in Birla Power Solutions is only 1.08%. It shows that the promoter himself lost faith in his company. For FY2013, Zenith Birla India reported a net loss of Rs44.62 crore while, during the June 2013 quarter it widened to Rs19.52 crore.

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u k saluja

u k saluja 1 week ago

Re: Micro Technologies India Ltd. and Avon Corpn.Ltd., Mumbai. Complaints made to CLB/MCA/liquidator, Mumbai for the last almost one year for payment against matured FDs. No acknowledgement. Companies gone into liquidation after collecting crores from small investors. Orders issued by CLB not complied with by companies' managements. Liquidator not notifying action taken on claims submitted to him. Complaining to Moneylife for almost one year. Article written by Ms Dalal on Microtech. No follow-up action taken by anyone. Senior citizens and others suffering for more than a year.Neither interest nor principal amounts paid. Bajaj Capital Limited who were collecting deposits also not of any help. They do not even reply to the emails sent to them. MCA/CLB must intervene and help sufferers. Thanks.

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Manharlal Patel

Manharlal Patel 2 weeks ago

please note that i have entered my complaint for non receipt of maturity amount to MCA in december but there is no action against company by MCA also and i have seen on website of MCA it shows my compalaint is closed without any compansation. i am not understanding that now what to do to get my money from Unitech limited, Tricom India ltd., and Birla Citsyn ltd. so it is my request you all please do not keep FD in these company

Manharlal patel

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u k saluja

u k saluja 1 month ago

There is no one to help poor FD holders of Micro Technologies India Ltd. and AVON Corpn.Ltd., Mumbai. Bajaj capital ltd. were instrumental in collecting deposits when people were filing claims to CLB and other authorities in Mumbai. CLB/Liquidator of no help. Claims filed many months ago. No progress. Not even an acknowledgement. Lost hope of getting any help from regulators and others. Companies' managements have washed their hands off after winding up ordered by the Hon'ble high court of mumbai. saluja, new delhi.

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Srikanth Shankar Matrubai

Srikanth Shankar Matrubai 2 months ago

Another big scam has been the Neesa Leisure.
The company has huge tracts of properties across India and all in prime locations which they can easily sell and repay the FD holders......but they are just careless.
NO reply to either email or Registered posts.
No one is taking phone calls too

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u k saluja

u k saluja 4 months ago

It would have been a great opportunity to bring to the notice of the Hon'ble Minister for Corporate Affairs to take up the matter of FD scam indulged by companies like to AVON Corpn.Ltd. and Micro Technologies India Limited, Mumbai who have duped hundreds of FD holders of their money by refusing to pay back money on maturity to their FD holders and others and have gone into liquidation thus leaving all such small investors in lurch. Nothing happening at the offices of CLB/MCA/Liquidator, Mumbai since claims/petitions not being considered for settlement. Many orders issued by CLB not complied with by companies'managements. Cases now with liquidator who has yet to look into the cases for settlement and no replies being given for the claims filed. Money life could help such sufferers by taking up the matter and render yeomen help to such people. Alas there is no one to help. Memos submitted time and again to all concerned have fallen on deaf ears. Thanks. U.K.Saluja.

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Srikanth Shankar Matrubai

Srikanth Shankar Matrubai 2 months ago in reply to u k saluja

That's the biggest shocker Mr.Saluja.
Seems that CLB has no power or it seems that CLB is hand in gloves with these companies.
I have given so many complaints against Neesa but things are virtually at standstill.
I wonder this is because Neesa Leisure MD Mr.Sanjay Gupta is a modi man (Mr.Sanjay Gupta was the head of Ahmedabad Metro and was personally hand picked by our beloved PM)

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