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Friday , January 11 , 2013
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ICICI caught in Lanco row

Mumbai, Jan. 10: ICICI Bank was today sucked into a legal dispute between Perdaman Chemicals & Fertilisers of Australia and Lanco Infratech.

Perdaman, which filed an Australian $3.5-billion lawsuit last year against Lanco in Australia, has now trained its legal guns at India’s second-largest lender.

Perdaman has proceeded against Lanco after Griffin Coal — a subsidiary that Lanco acquired in March 2011 for Aus $730 million — allegedly failed to comply with the terms of a fuel supply pact with the company’s urea plant in Western Australia.

ICICI Bank is a lender to Griffin Coal. Lanco had sought higher coal prices.

In its lawsuit, Perdaman alleged that ICICI Bank had acted in bad faith and interfered in its fertiliser project as Lanco sought higher coal prices. Lanco has denied the charge.

Although officials from the bank refrained from making any comment on the development, the news saw the ICICI stock close marginally lower on the stock exchanges. Capital market circles here said the news would not have any material impact on the financials of ICICI Bank.

However, Lanco clarified in a statement that ICICI Bank had no “contractual relationship” with Perdaman.

A spokesperson from the company said the charges against ICICI stemmed from the same case that was filed against Lanco in May 2011 which “is baseless and will be decided in our favour very soon”.

A statement from Lanco added that the current attempt of going against ICICI Bank is another “desperate attempt of greenmail in frustration”.

It went on to indicate that while Perdaman had filed the case against the private bank in the Federal Court of Western Australia, it is yet to be admitted.

“Perdaman started litigation against us in May 2011 to damage our reputation. It has tried to delay the legal process. Lanco is certain to thwart Perdaman’s tactics and their case will be dismissed,” the company said.

However, Perdaman Industries chairman and managing director Vikas Rambal said in an e-mailed statement that “in light of the Western Australia Supreme Court’s finding that Perdaman has a good arguable case and that the case should go to trial. Lanco’s statement that Perdaman’s claim is baseless can only be regarded as grossly misleading”.