Tobacco manufacturer Godfrey Phillips India’s (GPI’s) premises were searched by the Income Tax (I-T). The search continue for three days between 3 and 7 February. According to a news report, the raid took place over some financial transactions of GPI promoter and director of Indofil Industries Samir Modi.
The Company has extended full cooperation to the authorities. It will participate in any proceedings if required,” said the company in its statement because of raid.
The raid took place because of Section 132 of the Income Tax Act, 1961.
At present, there is infighting within the Modi family over the business of late Krishan Kumar Modi. He handled it for five decades, before his death in 2019.
Samir’s elder brother Lalit Modi, IPL founder and now a fugitive who has fled India because of mother’s decision. He does not agree with his mother’s decision. The decision is to name Samir as the CEO of the company as he even tweeted about this raid.
The disputes reached a point where Lalit decided to file for arbitration in Singapore, dragging mother Bina Modi. She is the president and managing director of GPI, Samir, and sister Charu Bhartia.
Recently, Lalit’s son and a director of GPI Ruchir wrote to the corporate affairs ministry, seeking a Serious Fraud Investigation Office and Sebi probe, alleging serious corporate governance issues and other malpractices at the company.
Final Words
The disagreement started because of Krishan Kumar’s death. Trustees of the KK Modi Trust—his wife Bina who automatically became the chair of the trust, sons Lalit and Samir, and daughter Charu—were unable to reach a consensus on any issue in running the company.
Yet, the decision took to appoint Bina as the MD and CEO of GPI. Following this, leveling of allegations and counter-allegations started among the family members.
Today, it is one of the largest cigarette manufacturers and have an annual turnover of approximately Rs 7,200 crore, according to the 2018–19 estimate.
