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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 roc.mumbai@mca.gov.in 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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115 Comments
Raj K Swamy

Raj K Swamy 1 week ago

I too have FDs with Elder Pharma and Birla Power Solutions unpaid after maturity. Have filed complaint with MCA after reading this useful article by Money Life. why CLB is not accepting investor complaints- We should all write to Minister for Corporate Afairs Mr.Arun Jaitely.

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Syed Khan

Syed Khan 2 weeks ago

Do we know why CLB stepped out here?

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u k saluja

u k saluja 3 weeks ago

It would be highly appreciated if your article on Micro Technologies India Limited, Mumbai is shown under this caption in addition to showing it under the caption "Moneylife Personal Finance" for the information of the small investors who have been crying hoarse for the last over 5 months for non-receipt of their money against matured FDs (Neither principal nor interest) having been paid by the company despite hundreds of emails/telephone calls and now orders having been issued by the Hon'ble High Court for its winding up and matter having been referred to liquidator, Mumbai. Affidavit of debt submitted to liquidator's office also still not acknowledged for the last 5/6 months, complaints made to MCA/CLB also brought no feedback and online information given is that matter stands "closed". All must get together and complain to all concerned and try and get back their money. Moneylife has been helpful so far and should now go out of their way to render their full support in getting back money to all small investors. Bajaj Capital Limited who were promoting FDs for Microtech should either get back the money from promoters of the company or themselves compensate the small investors of having deposits upto Rs.50000/-each within the next 2 months. Thanks.

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Rakesh Aggarwal

Rakesh Aggarwal 1 month ago

Hi All,
The above procedure was applicable till June, 2014. Since June 2014 CLB is no longer accepting form 4 in duplicate. All that is required to be done is to file online complaint on MCA website. The concerned Registrar of Companies is directed by MCA to write to the company to pay up the defaulted amount within a stipulated time say 20 days or so. After that in case the money is not received which is very likely, the complainant is required to write to the concerned ROC to file case against the defaulting company. ROC now has file report and take permission through their concerned Regional Director for prosecution action against the defaulting company. The RD also does not take any decision. The matter is referred to the Ministry of Corporate Affairs New Delhi. I have two similar cases concerning Neesa Leisure Ltd. and Plethico Pharma where the issue is pending with the Ministry. This is nothing but red tape which gives time to the defaulting company to manipulate further.
I think the investors of these defaulting companies should get together and file criminal complaints against such defaulting companies. Though it costs money but will be lesson for others. Corruption in this country which is so rampant will not be rooted out easily. The defaulting companies managements may have made inroads in the Ministry in last several years which is why such decisions are delayed beyond limits.
Once the companies have defaulted chances are very poor that you will get your money with this kind of laxity by the controlling agencies. Several companies have already vanished and several liquidated in which case secured loans get preference over non-secured ones.
Besides, if possible the suffering investors not only should write to the government agencies but also send the letters by email also and also send copies to the CBI, ACB, CVC etc. Let these agencies also investigate and get after the wrong doers.

Thank you,
Rakesh Aggarwal

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JGC

JGC 1 month ago in reply to Rakesh Aggarwal

s

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JGC

JGC 1 month ago in reply to JGC

I am also facing problem with Ind Swift Ltd. & Ind Swift Lab. Ltd (Chandighar based pharma co.)for Rs. 2L. CLB has allowed 8%interest, the entire order is one sided available on CLB website. I wonder is CLB Delhi authorised to reduced agreed rate of interest from 11.5 to 8%? How? I thought Interest Rates is decided by RBI. CLB Mumbai has passed order to extend FDR for 2 years AT SAME REATE OF INTEREST in order against BilCare Limited.

In case of your co.if cheques are bounced you may file case u/s 138 against company and it's CEO's/ CFO's/Director's/ Chairman.

See there is a problem with all political parties and Not a single party is talking about many scams took place in last 2 years. I had written to Dr. Kirit Somaiya of Mumbai BJP about scam by IND SWIFT LIMITED and it's Director but no reply. Only Apex Court is working in our country.

You are right. But Company Law Board & MCA is safeguarding COMPANY's as per their name. Only way's are file Police/Civil & Cases as per section 138 (if cheques are bounced)needs to be filed against Company, Directors, Chair mans & CEO's of the company who have duped your money. Seems there is no one out there to listen to Senior and good citizens who have lost Crores of rupees to these white colour chits under the shelter of appropriate authority.

Many FD Investors from Ahmedabad are writing complaints to Mrs. Nirmala Sitaramn (Minister)for
help. Other investors also should request in writing to Prime Minister & other related Minister, since they have promised to work for better governance/against Black money / against corruption / help Senior citizen's of country.

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Rakesh Aggarwal

Rakesh Aggarwal 1 month ago in reply to JGC

The Order passed by CLB is one sided and favours Ind Swift Lab only. On 28 October 2914 We have written to The Chairman, Principal Bench,Company Law Board and sent copies to the bench officer, CLB bo.nd.clb@nic.in, Registrar of companies chandigarh roc.chandigarh@mca.gov.in, Director, Investor Grievances Cell, MCA New Delhi, uttam.nahata@mca.gov.in, CVC, New Delhi, vigilance@nic.in and cenvigil@nic.in, Anti Corruption Bureau, Chandigarh, hobacchg@cbi.gov.in, hobscchg@cbi.gov.in, the Special Director, CBI New Delhi, sdas@cbi.gov.in hozchg@cbi.gov.in, Minister for Corporate Affairs fro@nic.in and secy.mca@nic.in and the Prime Minister (I did not get his email address). Most of these addressees have been sent letters and emails. Fortunately, CVC has lodged a complaint.
I would advise all those affected persons to please write to all these agencies and until such time there are a spate of complaints no one will take action. Do not forget most of the the officers in the Ministry are from the previous regime and are used to taking no action. Things will change very slowly but please keep writing to all such agencies.
Further, do not fall prey to attractive rates of interest advertised by companies or their agents. They collect their commission and leave the investors in a lurch like this one and several other companies. It is safe to earn a little less and put your money in FD in govt. banks only.
Thank you,
Rakesh Aggarwal

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JGC

JGC 1 month ago in reply to Rakesh Aggarwal

Thanks Rakesh Aggarwalji for contact details. Our PM is reachable through email add. of PMO and other links can be found through google search.
I had filled case against Ind Swift Ltd u/s NIA 138 at Ahmedabad. And now will send email complaints to all above mail ID's. Thanks again. JGC

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Rakesh Aggarwal

Rakesh Aggarwal 2 weeks ago in reply to JGC

Hi JGC
will appreciate if you could please get me the email address of the PM and if possible that of his Personal Secretary/Principal Secretary. Tried but could not locate it.
Thank you,
Rakesh Aggarwal

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Rakesh Aggarwal

Rakesh Aggarwal 2 weeks ago in reply to JGC

There is one more development on Ind Swift Lab.Case. The Under Secretary from MCA has also forwarded our complaint to the Chairman, Company Law Board for further action. Let us hope for the best.

I hereby urge all those suffering because of inaction by authorities earlier to please start writing to all the government agencies including Hon. Minister and the PM with copies to CBI, ACB and CVC without fail. It is high time the government comes down heavily on all of them. Perhaps the signs are visible.

All the best,
Thank you,
Rakesh Aggarwal

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JGC

JGC 2 weeks ago in reply to Rakesh Aggarwal

Could you please give details of IND SWIFT case like letter copy/ref. case no. date etc/ MCA & CLB address handling,so that others can also lodge their complaints with them.

Regarding PMO contacts pl. see below:
How can I get the Prime Minister of India's e-mail address so I can write to him?
Related to help

Hon'ble PM of India, instead of busy schedule, daily checks twitter and other social media website. If you are on twitter then you can share your thought using twitter handles:

Narendra Modi (@narendramodi) | Twitter

PMO India (@PMOIndia) | Twitter


If you are not on twitter and prefer to write mail, then you can write to(first you need to register):

Interact with Hon’ble PM
(English) Write to Shri Narendra Modi


If you want to write a letter, then you can write to:

Mann Ki Baat, Akashvani, Sansad marg, New Delhi-110001
Honorable prime minister of INDIA,
South block, Raisana hills, New Delhi-110101

ALSO
Mr. Modi does not have an official email ID. Even if he did, he can't make it public, because no human can read a billion emails in a day.
There are alternate ways to interact with him, although they are also moderated.

Twitter @narendramodi
http://www.narendramodi.in
http://mygov.nic.in
Narendra Modi official app from Play Store.
http://pmindia.gov.in/en/interac...

You need to register to be able to send message.

Regards,
JGC

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B P BANERJEE

B P BANERJEE 1 month ago in reply to Rakesh Aggarwal

Mr Rakesh agrawal is right every one should follow

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B P BANERJEE

B P BANERJEE 1 month ago in reply to Rakesh Aggarwal

Mr Rakesh agrawal is right every one should follow

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u k saluja

u k saluja 1 month ago

Despite writing number of msgs for the last couple of months, no article/editorial written by Moneylife on Micro Technologies India Limited Mumbai which has committed a fraud on its lenders/fixed deposit holders by not refunding money to its FD holders and other lenders. Mumbai High Court has ordered winding up of company. Liquidator appointed. Affidavit of debt submitted to liquidator's office at Mumbai. MCA complained. No feedback from anywhere. "Moneylife" should come tothe rescue of the small investors by writing an article and bringing the matter to the attention of top MCA officials and Ministry of Corporate Affairs and others in the concerned Ministries. Thanks. u.k.saluja.

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