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regular-article-logo Saturday, 13 April 2024

Kirloskar Brothers Ltd refutes charges of misutilising funds

We wish to clarify that the legal fees over the last seven years are a total of approximately Rs 70 crore: KBL

PTI New Delhi Published 17.10.22, 01:45 AM
Sanjay Kirloskar.

Sanjay Kirloskar. File picture

Kirloskar Brothers Limited (KBL) on Sunday refuted allegations that it had spent Rs 274 crore towards payment of professional legal expenses and consultancy charges in the personal dispute of its chairman and managing director Sanjay Kirloskar against his brothers Rahul and Atul.

Kirloskar Pneumatic Co Ltd executive chairman Rahul Kirloskar and Kirloskar Oil Engines Ltd executive chairman Atul Kirloskar had on Saturday accused KBL of “misutilising shareholder resources of a publicly listed company and misusing regulatory machinery” after being cleared of insider trading charges by the Securities Appellate Tribunal (SAT).

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Rahul and Atul had stated that being a listed entity, KBL should justify the rationale and basis on which the company “has been spending huge amounts aggregating to approximately Rs 274 crore towards payment of professional and legal expenses” ever since their dispute arose in 2016.

The brothers have been in a feud over the deed of family settlement for the assets of the more than 130-year-old Kirloskar Group.

“We wish to clarify that the legal fees over the last seven years are a total of approximately Rs 70 crore,” KBL said in a statement.

These expenses are towards tax matters, labour matters, arbitration pertaining to project business, cases related to domestic and international projects, patents, property documents and other issues.

The statement further said: “They have wrongly assumed that all these expenses are legal expenses. A major portion of the said Rs 274 crore is professional fees paid to various Indian and overseas reputed consultants to improve the company’s business.”

For a company with a consolidated turnover of over Rs 2,500 crore per annum, KBL said, its “legal expenses of Rs 70 crore over last seven years is logical and does not support any allegation made.”

Kirloskar Industries Ltd (KIL) is the largest shareholder and has not written to KBL over the last several years on their concerns for payment of professional and legal expenses ever since the disputes arose, it added.

“In fact, they have voted in favour of accounts and dividends every year. And now in 2022, Atul Kirloskar, chairman of KIL, has issued a statement with these baseless allegations,” KBL asserted.

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