‘Term sheet signed by Paresh Rawal in good faith. No script, schedule or long-form agreement was shared…Rawal and others received notices from Firoz Nadiadwala, producer of the original films, claiming IP right’
Niharika Lal (BOMBAY TIMES; May 26, 2025)
Following Paresh Rawal’s exit from Hera Pheri 3, he received a legal notice from Akshay Kumar’s production house Cape of Good Films. Akshay’s lawyer had claimed that “Cape of Good Films incurred substantial production and promotional expenditures, including those for the teaser and initial film shoot, in which Mr Rawal actively participated.” They added that Rawal signed a term sheet on March 27, accepted payment of Rs. 11 lakh, and shot for a teaser on April 3.
On Sunday morning, the veteran actor shared on his X handle that, “My lawyer, Ameet Naik, has sent an appropriate response regarding my rightful termination and exit. Once they read my response, all issues will be laid to rest.” Sources close to the development share with detailed reasons behind the exit and details of Rawal’s response to the legal notice.
Termination is on strong legal footing. Nothing was and is ready, so there cannot be any loss: Paresh Rawal’s lawyers
Rawal’s lawyer Ameet Naik, whose law firm Anand & Naik sent the notice reply, says, “We have replied to the notice and Paresh Rawal’s termination is on strong legal footing.”
Abhishek Kale, Partner, Anand & Naik, shares, “They did not deliver the story, screenplay or a draft of a long form agreement, which was fundamental to the engagement of our client. In the absence of these and also since Mr Nadiadwala, the producer of the original films, issued notice to our client and raised issues on the making of the film, our client chose to exit and returned the money with interest by terminating the term sheet. First, they accepted the monies, but later, unfortunately, sent an untenable notice to our client when knowingly nothing was and is ready, so there can never be any loss.”
The legal team of Cape of Good Films did not respond to our queries till the time of going to press.
‘Rawal signed the term sheet without reading it’
A source close to the actor tells us that Rawal signed the term sheet without reading it. It stated that he will receive 99% remunerations after the film’s release. “As per film industry contract standards, actors receive a fee structured across pre-production, production, and release. In this case, the term sheet granted Rawal less than 1% of his remuneration upon signing, with the remaining 99% due only after the film’s release,” the source says. Another source explains, “If Paresh Rawal had read the commercial terms closely, he would not have signed it because the commercial terms were twisted.”
‘Paresh Rawal signed term sheet solely on trust’
Since last year, Akshay Kumar and Paresh Rawal have been working on a separate project – titled Bhooth Bangla – directed by Priyadarshan. A source tells us that in March, during the shoot of this film, Akshay approached Rawal with a term sheet for Hera Pheri 3, asking him to sign it, adding that they’ll enter into a long-term agreement later. According to sources familiar with the interaction, Rawal expressed concern at the time, since he had not seen any documents and had no idea about the script or story.
“Akshay told him, ‘Don’t worry, trust me. You’ll see it later in the longform agreement.’ Based on his personal rapport with Kumar and acting in good faith, Paresh Rawal signed the term sheet,” the source adds.
In April, Rawal was asked to shoot a promotional video for Hera Pheri 3. He once again questioned Akshay about the script, the production plan, and the long-term agreement, says the source. But he was told that the promo needed to be filmed in time for the IPL final, and that the details would be worked out later.
The source says, “The promo was eventually filmed on the Bhooth Bangla set, with some modifications. Shooting was initially scheduled to begin in 2026. Rawal suggested deferring the promo shoot to next year. To date, Paresh Rawal has not received a long-term agreement, script, or any official production details.”
‘Paresh Rawal and others received notices from producer Firoz Nadiadwala, who has the IP rights of the franchise and characters’
As per sources, the intellectual property rights of the original Hera Pheri films Hera Pheri (2000) and Phir Hera Pheri (2006) are with producer Firoz Nadiadwala. A source says, “He has sent legal notices to Akshay Kumar, Priyadarshan, Suniel Shetty and Paresh Rawal. The legal notice issued asked all of them not to do any promos, endorsements, or any activities related to the Hera Pheri franchise. It also stated that if they go ahead and proceed with it, it will be considered a willful breach. The notice also stated that the IP of all the characters, including Babu Bhaiya are with Nadiadwala.”
“Paresh Rawal has a longstanding investment in the character of Baburao Ganpatrao Apte (Babu Bhaiya) and wanted to have clarity before proceeding,” says a source close to the actor, adding that he was uncomfortable with the disorganised process and there were no creative differences because the script is still not in place. Rawal subsequently returned the signing money and issued a termination notice, which the production house accepted.
What Paresh Rawal’s notice reply says
– The term sheet was signed by Paresh Rawal in good faith without legal review.
– The promotional video was shot in haste to meet the deadline for the IPL final. Paresh Rawal repeatedly questioned about the urgency.
– Rs. 11 lakh (the signing amount), with 15% interest, was returned prior to the legal notice from Cape of Good Films. The production house accepted the termination and the money.
– There remains uncertainty over the ownership of the Hera Pheri 3 title. There is an ongoing legal correspondence between Firoz Nadiadwala and Akshay Kumar regarding the franchise itself.
– Creative differences were not the only reason for Paresh Rawal’s exit. The reasons are no script, no production schedule, no longform agreement, along with the dispute over the franchise and franchise title.