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Hearing on LIC suit in Modi Rubber case adjourned

K.R. Srivats

NEW DELHI, Aug. 13

THE Mumbai High Court has adjourned the hearing in the matter of Life Insurance Corporation's (LIC) suit in the Modi Rubber open offer case to August 18.

Industry sources said the case was listed ``way down'' in Monday's cause list. ``As no hearing on this matter was possible on Monday, the case has been adjourned to August 18,'' sources said.

It was, however, pointed out that the parties to the case have already made their ``written submissions'' to the Court and the outcome of the LIC case is expected to primarily revolve around these submissions.

LIC had on July 23 this year approached the Mumbai High Court seeking an injunction against the transfer of its holding in Modi Rubber Ltd (MRL) to the promoters of the company. LIC had submitted that it had participated in the open offer, made by the Mo di Brothers', ``inadvertently'' on account of the ``unauthorised and illegal'' instructions of junior-level officers.

The corporation had contended that their participation in the open offer did not have the approval of its investment committee, whose consent was mandatory.

Legal experts pointed out that Monday's adjournment in effect implied that the manager to the open offer would have to wait for some more time before completing the statutory formalities concerning the open offer.

One of the Managing Directors of MRL, Dr B.K. Modi, has been claiming that even a verdict against LIC's participation in the open offer would not adversely affect the outcome of the offer as both Modipon and Modi Spinning have now been allowed to partici pate in the open offer.

He has been asserting that any shortfall in the Modi Brothers' attempts to gain 51 per cent holding in MRL can always be made good through secondary market purchases.