Jagan Mohan, sister Sharmila in ugly spat over property, shares

A property row involving former Andhra Pradesh chief minister YS Jagan Mohan Reddy and his sister YS Sharmila has turned ugly, with the former seeking to take back a large volume of shares of a company transferred to her and their mother YS Vijayalakshmi.

Reddy had written to the National Company Law Tribunal (NCLT) demanding the cancellation of the "illegal' transfer of shares in Saraswati Power and Industries Pvt Ltd to the two women.

Simultaneously, Reddy, who was ousted from power last year, also accused Sharmila, who now heads the Congress in Andhra Pradesh, of deceit and said he did not wish to honour a MoU they had signed.

Reddy moves NCLT over shares

Reddy and Sharmila signed an MoU in August 2019 wherein he agreed to transfer some properties and shares "out of love and affection".

On September 10, Reddy and his wife Bharathi Reddy petitioned the NCLT, asking the company to reinstate them as shareholders with the same equity shares as before the transfers were made.

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Battle over company shares

Terming the Saraswati Board resolution on July 6 approving the share transfer as "illegal", Reddy also asked the board to cancel the allotment and issue orders to correct the records by restoring 74,26,294 (29.88 per cent) shares to him, 40,50,000 shares (16.30 per cent) to Bharti, 1,21,74,207 shares (48.99 per cent) to their mother and 12,00,000 (4.83 per cent) shares to Classic Realty.

Reddy and his wife said the share transfers to Sharmila and the siblings’ mother were done through a board resolution without following the proper legal procedure.

And so, the transfer of shares was "invalid, illegal, void, and unlawful", the former chief minister said.

Reddy writes to Sharmila

The NCLT has issued notices to all respondents and scheduled the next hearing for November 8.

Reddy wrote to his sister on August 27 that along with the ancestral property inherited from their father and former chief minister YS Rajasekhara Reddy, he had also built his own businesses.

"Unrelated to any consideration and purely out of love and affection, I intended to effect transfer of certain properties to you at a future point of time. This was in addition to the amount of approximately Rs.200 crores already given to you directly or through our mother over the last decade or so," he wrote.

Sharmila hits back

But Sharmila, he said, had attacked him publicly. "In view of this and other actions undertaken by you, it makes me wonder why there should be any love and affection or fondness towards you.”

In turn, Sharmila has accused Reddy of not acting in accordance with the will of their father to distribute the property equally among all four of his grandchildren.

"You have now chosen to file cases against your own mother and deprive your own sister and her children of properties to which they are entitled under the MoU,” she said in her communication. “I am appalled at the extent to which you have strayed from the path of our noble father.”