Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday

Copal Art’s financial practices face string of new questions

Copal Art’s financial practices face string of new questions
Comment E-mail Print Share
First Published: Fri, May 11 2007. 12 46 AM IST

Updated: Fri, May 11 2007. 12 46 AM IST
The owner of Copal Art gallery, Ajay Seth, who claimed he had raised Rs20 crore from investors for two art funds last year, faces allegations of financial misrepresentation over non-payment for art and multiple cases of bounced cheques.
These accusations against Seth come from several artists and other galleries, raising several troubling questions about the entrepreneur-turned-art-fund manager.
Seth had claimed to pioneer a new type of art fund where investors pooled in money and bought artworks at discounted prices, with specific works actually handed over to individual investors to take home. Seth has also said he is raising a third fund, worth Rs150 crore.
While the amounts involved in these new disputes are relatively small, they come from a variety of unrelated people. The questions about Seth are also coming at a time when more and more concerns are being raised about the lack of regulations in the booming art investment sector in India.
While there is no evidence that one fund owner’s problems are symptomatic of a widespread malaise in Indian art funds, which total about Rs250 crore across at least five separate funds, the “art as investment” business in the country has recently come under serious regulatory and government scrutiny amid questions about valuations and use of cash for such transactions.
Last month, Indian tax authorities raided several galleries, gallery owners and art fund managers, including Copal Art, seeking records of transactions?and?lists?of buyers.
The latest allegations about Seth come after a front-page story in Mint on 23 April that pointed to significant inconsistencies between his statements—about art works that the fund said it had acquired and artists who the fund claimed were involved with the fund—and the statements of the artists themselves, several of whom denied actual involvement with the fund.
Now, several artists, many of whom are trying to make a mark in a very competitive field, told Mint that Seth has not paid them for their works, which include both paintings and sculptures. At least two artists and a Delhi gallery said cheques, written by Seth, have bounced and their attempts to talk to him have often been unsuccessful. A local bank also confirmed that Seth had issued at least four cheques that were turned down for lack of sufficient funds in his account.
When asked about these complaints, Seth initially said, “If you progress, you have enemies.” “Why don’t the artists whose cheques have bounced come forward?” he asked. On Thursday, Seth was repeatedly contacted by Mint to respond to the other allegations. He said he was in meetings and couldn’t talk. Meanwhile, some of the artists who had complained to Mint said Seth has called them to promise that he will buy their works and pay back dues.
Consider Habiart Foundation, which runs an art gallery at the prominent Habitat Centre in the Capital. Last year, Seth approached the foundation to book space for an exhibition. Both the cheques he then gave, bounced—one of them for a sum of Rs9,000. Habiart pulled out of the transaction after another cheque (#040630) from Lord Krishna Bank, made out by Seth didn’t get encashed.
An official at Habiart said two dozen calls were made to Seth about the overdraft cheques. “One Mrs Jain used to pick up the phone and used to say ‘Seth is away in London or America and will give the cash when he returns’,” he said. The Habiart official did not want his name used for fear of retaliation.
The woman artist, whose works were to be exhibited by Habiart, also did not want her name published as she is mounting another unrelated show this year and did not want negative publicity. She said Seth called to say the show was cancelled two days before the exhibition and didn’t give a reason.
“Senior artists can talk,” she said. “We can’t as we are in the process of establishing ourselves. It’s sad that it’s happening. It should be a transparent system.”
An official at a Lord Krishna Bank regional office in central Delhi confirmed the cheque information and said that four cheques issued by Seth bounced in January 2006 alone. The officer, who did not wish to be quoted, refused to confirm whether Seth has been asked to stop operating his account for issuing cheques against insufficient funds, a punishable offence under the Negotiable Instruments Act, 1881, but said no transactions had taken place through that account after 1 March 2006. “The account has not been operating since 1 March 2006,” the bank officer said.
M.C. Aggarwal, who lives in Faridabad, is one of the artists that Seth promotes on his website, www.copalart.com. Aggarwal said he handed over 40 artworks to Copal Art Gallery last year and is still owed Rs50,000. Seth had previously maintained that his fund is different since it makes upfront payments to artists, unlike other funds that only pay a portion of the money.
Aggarwal said Seth visited him when he was holding an exhibition in Indraprastha Art Gallery in East Delhi’s Patparganj area. Now closed, the gallery was run by Amresh Gupta. Aggarwal said both Seth and Gupta kept blaming each other for non-payment of money. Aggarwal said he did not sign any documents with Seth. “That was a mistake on my part,” he admits. Gupta, who used to run Indraprastha, refused to comment, but said Aggarwal was the person to talk to about dealings with Copal Art.
Last year, Seth organized an exhibition of nearly 125 paintings of a Delhi-based artist. He says he was given a cheque of Rs50,000 by Seth and promised a retainer fee of Rs75,000 a month to keep producing new art. The artist said the Rs50,000 cheque bounced. When he contacted Seth, the artist said, Seth told him his artworks were circulating among potential buyers, including one person who works in a television company. After having a personal confrontation with Seth at Copal’s Greater Kailash gallery, the artist said he was given back 122 paintings.
The building in which Copal operated its gallery has since been sealed as part of a drive against illegal commercial constructions in the Capital. The artist, who lives in Malviya Nagar, did not want to give his name before Friday because he said Seth, on hearing that Mint had been in contact with artists, has been calling them to say he’ll buy their works and pay them.
Then there is the case of 70-year-old Sher Singh Kukkal. Three years ago, Kukkal said, Seth visited the Noida-based artist’s home and selected four paintings, four sculptures, including two each in terracotta and stone and one executed in fibre-glass. Kukkal said Seth agreed to pay roughly Rs3 lakh for all the works, collected them, but then refused to pay and kept making “excuses of being in Singapore or London” or not taking phone calls.
Last year, Kukkal said, an interior decorator who saw photographs of some of the same works wanted to buy them. Kukkal said he then got hold of Seth who promised to return the works during the Diwali season last year. As of this week, Kukkal said, he is yet to get the artworks back.
Another artist, Sangeeta Singh, said Seth sponsored a show of her paintings at the gallery in Lalit Kala Akademi, located near Connaught Place. She said he paid for the brochures, invitations and other publicity material and in return he took three paintings, while agreeing to pay her Rs5,000 as a balance amount. Singh said the cheque that Seth wrote bounced and he didn’t return her calls. Only after she threatened legal action, Singh said, did Seth give her the money.
Comment E-mail Print Share
First Published: Fri, May 11 2007. 12 46 AM IST