FKCCI wants plaint against LG probed

 

The LG Group has not responded to notices sent by the assistant commissioner of police (fraud & misappropriation) on February 22, 2014, under several sections of CRPC and IPC, based on a complaint lodged by Mr Vijay R. Singh, Managing Director, India Household & Healthcare Ltd (IHHL), Bengaluru, nor agreed for arbitration on the amount received for supply of FMCG products. The South Korean Embassy in New Delhi, too, has not replied to a letter written by Mr S Sampathraman, president, FKCCI, on March 25, 2015, seeking intervention for repayment of the amount to the patron member of FKCCI. Therefore, Mr Tallam R. Dwarakanath, Mr Sampathraman’s successor, says he would not only send a reminder to the ambassador but take up the issue during his forthcoming visit to Bengaluru. “I am aware of the fact that we have not received a reply so far. So, we will remind him about the case and request him to resolve the dispute when we meet him in Bengaluru,” he told Deccan Chronicle.

 

Meanwhile, officers of the city crime branch have taken up investigation into IHHL’s complaint following an order issued by the fourth ACMM court on November 18. The court passed the order stating that according to the complainant, there was no stay order against LG Household and Healthcare, the first accused in the case. IHHL, promoted by Mr Vijay R Singh, was the top performing distributor for LG Electronics India from 1998 to 2004. “In order to extend our business relationship, we signed various legal agreements with LG H&H, South Korea, for sole distribution rights of LG FMCG range of products in India. We spent about Rs 118 crore for purchase of consumer products from LG, and another Rs 58 crore as capital expenditure and operational expenditure. However, three different arbitrary termination notices were served on IHHL to stop the sole distribution rights, stating the new change in LG logo policy from 2005. They took the entire amount in advance and cheated my family and myself,” rues Mr Vijay R Singh.

 

He said with such the South Korean behemoth neither supplying products nor returning such an enormous fund paid as advance, a 50 year-old enterprise owned by his family had no choice but to close down its chain of showrooms resulting in scores of staff losing their jobs. Mr Vijay R Singh alleged that LG Household and Health Care Ltd had taken a stand that Mr C H Kim and Mr B K Jung, who signed the MoU, were not authorized to do so, and had not informed the head of Global Business Division on their return to South Korea. Besides, the company could not be held responsible as both were now former employees who had executed “fraudulent MoU” and “License Agreement”.

 

In notices sent to the CEO, Managing Director and others of LG, Mr G K Chikanna, assistant commissioner of police, Fraud & Misappropriation Squad, Central Crime Branch, has said that various companies of the LG Group have, by using fraudulent means and with the help of forged and fabricated documents, cheated IHHL of several crores of rupees since May 2004. The fraud has also caused losses to government run agencies like State Trading Corporation (STC), Mines & Minerals Trading Corporation (MMTC), and Union Bank of India. The MD of LG International Corporation, India, was asked to appear before the investigating officer with all relevant documents within 15 days of the notice which was issued on February 22, 2014, but failed to show up.