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|April 26, 1999||
Baron Bachchan braves a bad patch as ABCL falls sick
Syed Firdaus Ashraf in Bombay
India's most well-known movie celebrity and chairman of Amitabh Bachchan Corporation Limited, Amitabh Bachchan, is these days mired in controversy, and suffers debt on one hand and film shootings on the other.
ABCL, which was incorporated in 1994 with the avowed objective of corporatising every aspect of the Indian entertainment industry, has run amuck due to huge debts and mismanagement.
There are pending cases ABCL for bouncing of cheques and non-payment of dues. United Television, or UTV, and Prasar Bharati, which claims ABCL owes it Rs 180 million, are among the prominent companies that have filed cases.
Public sector Canara Bank, to which ABCL owes Rs 80 million, has filed a case for attachment of his Juhu bungalow Prateeksha, one of the best-known landmarks in Bombay.
Today, however, Bachchan got a respite from the hounds at his heels. The Bombay high court postponed the hearing of the case against his company to June 22. Justice A P Shah said the receiver will not be allowed to take possession of the property till further orders.
The case dates back to 1996, when the ex-supernova had taken a loan to fund ABCL. But, as ABCL got mired in losses, he was unable to repay the loan. The bank offered the loan as Bachchan himself stood in as guarantor.
"Our client (Canara Bank) has an outstanding amount of Rs 100 million. Today, the only way we can recover our money is by attaching his bungalow," said Nishit Dhruv of Dhruv & Company, solicitors who are contesting the case against ABCL. "The difference is Bachchan made ABCL the guarantor in other cases. But in our case, Bachchan himself is the guarantor."
ABCL had expected to post profits by 2000 AD so that all the loans and other borrowings could be made good.
The company made forays into almost every segment of the industry like film distribution, film production, event management. The Miss World 1996 contest in Bangalore was held under the aegis of ABCL.
ABCL is also into celebrity management with clients such as film stars Aamir Khan, Sunil Shetty, Arshad Warsi, Chandrachur Singh, Priya Gill and Simran. Its foray into film music via the Big B label was sold out to Super Cassettes of T-Series fame.
ABCL's own productions tasted either moderate success or losses. If the much-hyped Mrityudaata starring Bachchan himself was declared a disaster, Saath Rang Ke Sapne starring Juhi Chawla and Arvind Swamy was branded a terrible flop. Tere Mere Sapne starring Arshad Warsi, Chandrachur Singh, Priya Gill and Simran was a moderate success.
The 1996 Miss World had its own share of controversy that did no good to ABCL's corporate image. The company was accused of reneging on its promise to donate a share of the event's proceeds to spastic children.
ABCL conducted a widely publicised nationwide talent search contest. Thousands of young, aspiring artistes enrolled, each of them paying Rs 500 as entry fee. However, not many stars were discovered and groomed. And the critics hinted at possible misrouting of the money collected.
Meanwhile, as flop after flop piled up huge losses, threatening to sink the ABCL ship, many of its top managers recruited from blue chip Indian corporates deserted the company.
On March 15 this year, ABCL was declared sick and was referred to the Board for Industrial and Financial Reconstruction.
The downslide continues. According to Dhruv, Bachchan's Prateeksha bungalow is not the only property which the bank has asked the court to attach. Big B's two other flats in Bombay may also be attached.
On April 16, the Bombay high court passed an order that Prateeksha cannot be sold and that Bachchan will have to wait for further orders in case he wants to sell his bungalow.
Canara Bank officials refused to speak on the case saying it is sub judice.
Shekkar Naphade, ABCL's lawyer, said, "At present, I can only say that the receiver is not allowed to take possession of the property till further order. No further comments."
According to Dhruv, Bachchan's solicitor made a startling disclosure on April 16, that Prateeksha had already been mortgaged to the Sahara group. The court has asked for full details.
However, not a single word about Sahara was mentioned in today's hearing. Justice Shah, after hearing the case for 15 minutes, fixed a new date for the order.
Sources close to Canara Bank said the disclosure about mortgaging Prateeksha to Sahara is baffling.
The case has generated considerable public interest, and the court precincts were teeming with a large crowd today. As the judge delivered his two-line order, anxious, excited onlookers scrambled up the premises, wondering whether the greatest Indian movie star will be asked to move out of his fabled home.
Bachchan was said to be in Hyderabad shooting for a film. Media reports hinted that he, embittered by the mismanagement by those who he trusted, has decided to hand over the ABCL reigns to his son Abhishek. One onlooker at the court commented: "It's a tale of one angry old man and the newest angry young man."
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