Both Mody and his partner Bajoria said the divestment is just another corporate move, but industry sources said the two stalwarts had fallen out over the control of Mobar. The name itself was derived from the first two letters of Mody and Bajoria, and the first letter of the German partner's name.

Sources in Willard said Bajoria had gained some control at Mobar, but a funds crunch in his own company forced him to sell his stake back to Mody and Aditya Kashyap, the former Mody lieutenant who quit Tata Iron & Steel Co to join the trading house as its managing director.

"For the last two and half years, Willard India has been suffering from an acute funds crunch, which has constantly affected its operations. At present, Bajoria needs to infuse funds as workingcapital. So he has decided to hive off his stake in Mobar India," sources said.

Bajoria told The Financial Express that Willard has divested its stake in Mobar to concentrate on its core business.

"Yes, we have divested our stake in Mobar India because we wanted to concentrate in our core business areas -- jute and sugar," Bajoria said.Mody, when contacted at his residence in Calcutta, also agreed that Bajoria has divested his stake and that it was taken up by him and Kashyap.

Industry sources said Bajoria had been against divesting his stake, and actually been planning to increase it.According to Willard's 1995-96 annual report, the company's stake in Mobar was a mere Rs 100 consisting of 10 equity shares. This had increased to Rs 71,50,100 (7,15,010 equity shares) by the end of March 31, 1997, according to the annual report of 1996-97.

Sources also said that Bajoria applied for another 17,45,990 shares to take Willard's investment up to Rs 2.5 crore. The money was also paid to Mobar. However, therequest was turned down by Mody.

"The request was turned down by Modi, and subsequently he forced Bajoria to divest his stake. At this point of time, Bajoria wanted to select a third party of his own choice for divesting his share but that too was turned down by the former Tisco chairman," sources said.

Both Bajoria and Mody denied this and also failed to recollect the total stake and its value that changed hands.While Bajoria said, "I do not remember the details of the transactions", Modi noted, "I do not know.".Sources said that Modi has started paying in instalments the Rs 2.5 crore that is due to Bajoria for his stake. The entire amount will cleared by the end of June.

Kashyap also declined to disclose the equity base and the shareholding pattern of Mobar, as the company is not a public limited one.