PIL against Centre and govt bodies for investing in tobacco cos

Tata Trust's trustees, R Venkataramanan and Laxman Sethuraman and five others filed a public interest litigation (PIL) against the Union government, the Insurance Regulatory and Development Authority of India (IRDAI) and five other government-owned life insurance companies for investing in tobacco companies such as ITC and VST Industries, which is contrary to the anti-tobacco stance of the Union government.

The aggregate holdings of the state-owned bodies in these tobacco companies amount to Rs 1.03 lakh crore, as per the closing prices on April 13, 2017. The four public sector insurance companies and the Specified Undertaking of the Unit Trust Of India (SUUTI) cumulatively owned 30.25 per cent stake in ITC, while Life Insurance Corporation of India (LIC) holds 16.29 per cent stake in ITC. On February 7, 2017, the Union government sold two per cent of its stake in ITC held through SUUTI to LIC for Rs 6,700 crore.

The PIL states that LIC should not be a party to ITC's business as LIC sells life insurance cover to millions of Indians.

ITC is the largest company in the FMCG sector, according to market value. However, nearly 48 per cent of the company's revenue and 85 per cent of its profit is derived from its cigarette business.