By S A Ishaqui
Hyderabad, Jan 8 : The Andhra Pradesh High Court directed the police not to arrest former directors of Nagarjuna Finance Company, Mr K.S. Raju and Mr P.K.S. Madhavan in other cases pending against them in the state as well as in other states.Mr Raju and Mr Madhavan filed separate petitions seeking a direction to club all the cases pending against them in Tamil Nadu, Karnataka, Mumbai, West Bengal, Delhi, Bihar, Uttar Pradesh and Gujarat.
Deposit holders filed as many as 90 cases against them for non payment of fixed deposits and interest by NFC Ltd.
The petitioners told the court that they were faced with imminent threat of being repeatedly arrested on the similar set of facts and circumstances for which they have already been arrested.
Dealing with the petition Justice D.S.R. Varma refused to issue a direction to club all the cases and treat them as one case.
The court also refused to stay all further proceedings in pending cases. The court said the investigation may go on and not to arrest the petitioners in other cases till further orders.
Friday, January 9, 2009
Thursday, January 8, 2009
NFCL men granted bail by HC
By S A Ishaqui
Hyderabad, Jan. 7: The Nagarjuna Finance directors, Mr K.S. Raju and Mr P.K.S. Madhav, were granted conditional bail by the High Court on Wednesday. However, the High Court rejected Mr Raju’s plea to exempt him from the liability of paying depositors’ amount back. Both the directors were asked to pay Rs 10 lakh as security.
Raju fraud may cost him 500 times
By S A Ishaqui
Hyderabad, Jan. 7: The outgoing Satyam Computers chairman, Mr Ramalinga Raju, and his colleagues may face a four-cornered inquiry for the fraud of over Rs 5,000 crore.
As per the law, Mr Raju will have to undergo a jail term of 10 years and will have to pay 500 times the amount as penalty if the charges are proved under Section 45 of the Securities and Exchange Board of India Act.
The Company Law Board and Registrar of Companies can initiate a suo moto inquiry on the basis of the statement given by Mr Raju on the inflation of funds in the company.
"The registrar of companies need not wait for a formal complaint as Mr Raju has already admitted his guilt," said Mr Veera Reddy, a senior advocate of the AP High Court. "A probe can be ordered under Section 235 of the Companies Act 1976."
Another advocate, Mr P. Subhash, said that Mr Raju’s statement also invited action under several provisions of the Indian Penal Code. It involves criminal breach of trust," he said. "Producing forged or fictitious documents for personal gains amount to criminal conspiracy."
Mr Subhash said police could launch an investigation based on Mr Raju's statement. "The police should book a case under Section 477 (a) of the IPC dealing with the falsification of accounts against the company and Mr Raju," he said.
In fact, Mr Raju’s statement also draws in the auditors and company secretaries into the ambit of the inquiry.
The Institute of Charted Accountants of India could initiate a probe into the role of the auditors in the alleged fraud.
"If the Institute does not initiate the probe, an investor can file a complaint, contending that he invested the money based on the audit report," said Mr V.V.L. Narasimham, a chartered accountant.
Mr Veera Reddy pointed out that the company secretaries could also face an inquiry for their role in the fraud. "The company directors can also come under the ambit of the probe under the Securities Contracts (Regulation) Act, 1956," he added.
Hyderabad, Jan. 7: The outgoing Satyam Computers chairman, Mr Ramalinga Raju, and his colleagues may face a four-cornered inquiry for the fraud of over Rs 5,000 crore.
As per the law, Mr Raju will have to undergo a jail term of 10 years and will have to pay 500 times the amount as penalty if the charges are proved under Section 45 of the Securities and Exchange Board of India Act.
The Company Law Board and Registrar of Companies can initiate a suo moto inquiry on the basis of the statement given by Mr Raju on the inflation of funds in the company.
"The registrar of companies need not wait for a formal complaint as Mr Raju has already admitted his guilt," said Mr Veera Reddy, a senior advocate of the AP High Court. "A probe can be ordered under Section 235 of the Companies Act 1976."
Another advocate, Mr P. Subhash, said that Mr Raju’s statement also invited action under several provisions of the Indian Penal Code. It involves criminal breach of trust," he said. "Producing forged or fictitious documents for personal gains amount to criminal conspiracy."
Mr Subhash said police could launch an investigation based on Mr Raju's statement. "The police should book a case under Section 477 (a) of the IPC dealing with the falsification of accounts against the company and Mr Raju," he said.
In fact, Mr Raju’s statement also draws in the auditors and company secretaries into the ambit of the inquiry.
The Institute of Charted Accountants of India could initiate a probe into the role of the auditors in the alleged fraud.
"If the Institute does not initiate the probe, an investor can file a complaint, contending that he invested the money based on the audit report," said Mr V.V.L. Narasimham, a chartered accountant.
Mr Veera Reddy pointed out that the company secretaries could also face an inquiry for their role in the fraud. "The company directors can also come under the ambit of the probe under the Securities Contracts (Regulation) Act, 1956," he added.
Tuesday, January 6, 2009
Former NFC chief’s plea
By S A Ishaqui
Hyderabad, Jan 5 : Mr K. Satyanarayana Raju, former director of Nagarjuna Finance, who is in judicial custody, filed a bail petition in the High Court on Monday.
The Hyderabad City Central Crime Station authorities arrested him on December 15, 2008, under Section 406, 420 of IPC and Section 5 of the Andhra Pradesh Protection of Depositors of Financial Establishments Act.
The petitioner argued that the special court is not competent to remand him as the APPDFE Act has no power over him.
He contended that he was not responsible for non payment of deposits to deposit-holders and said that the new management was responsible to it. Mr Raju said the consumer courts held that he was not liable and the new management had to repay the deposits.
However, Mr P.K. Madhav, another former NFC director, filed a petition seeking a direction to club all the crimes pending against him relating to non payment of fixed deposits by NFC and investigate the matter together. Mr Madhav was arrested along with Mr K.S. Raju.
Hyderabad, Jan 5 : Mr K. Satyanarayana Raju, former director of Nagarjuna Finance, who is in judicial custody, filed a bail petition in the High Court on Monday.
The Hyderabad City Central Crime Station authorities arrested him on December 15, 2008, under Section 406, 420 of IPC and Section 5 of the Andhra Pradesh Protection of Depositors of Financial Establishments Act.
The petitioner argued that the special court is not competent to remand him as the APPDFE Act has no power over him.
He contended that he was not responsible for non payment of deposits to deposit-holders and said that the new management was responsible to it. Mr Raju said the consumer courts held that he was not liable and the new management had to repay the deposits.
However, Mr P.K. Madhav, another former NFC director, filed a petition seeking a direction to club all the crimes pending against him relating to non payment of fixed deposits by NFC and investigate the matter together. Mr Madhav was arrested along with Mr K.S. Raju.
Chiru Party fights order on road show
By S A Ishaqui
Hyderabad, Jan. 5: The Praja Rajyam and the Bharatiya Janata Party approached the AP High Court challenging the Constitutional validity of the orders issued by the director-general of police banning road shows.
The DGP had issued a circular on December 12, 2008, prohibiting road shows on national and state highways and important artillery roads.
Mr Allu Aravind, general secretary of the PR, and the BJP Legislative Party leader, Mr G. Kishen Reddy filed the petitions.
The petitioners contended that the DGP had no power or jurisdiction under any of the laws which are in force. Public order and police are different entries in the Constitution, and making laws are the exclusive domain of the state government. The police Act 1861, cannot confer any power or authority on the police, who are functioning under local laws.
They argued that the circular had no statutory basis and it cannot be construed as an executive instruction under Article 162 of Constitution.
The petitioners further contended that "it is a settled law that a circular cannot over ride the statute. Circulars or administrative instructions cannot supplant the law, but they can only supplement it."
They submitted that prohibiting road shows and selectively limiting them to rural roads is arbitrary and violative of Article 14 of Constitution.
Hyderabad, Jan. 5: The Praja Rajyam and the Bharatiya Janata Party approached the AP High Court challenging the Constitutional validity of the orders issued by the director-general of police banning road shows.
The DGP had issued a circular on December 12, 2008, prohibiting road shows on national and state highways and important artillery roads.
Mr Allu Aravind, general secretary of the PR, and the BJP Legislative Party leader, Mr G. Kishen Reddy filed the petitions.
The petitioners contended that the DGP had no power or jurisdiction under any of the laws which are in force. Public order and police are different entries in the Constitution, and making laws are the exclusive domain of the state government. The police Act 1861, cannot confer any power or authority on the police, who are functioning under local laws.
They argued that the circular had no statutory basis and it cannot be construed as an executive instruction under Article 162 of Constitution.
The petitioners further contended that "it is a settled law that a circular cannot over ride the statute. Circulars or administrative instructions cannot supplant the law, but they can only supplement it."
They submitted that prohibiting road shows and selectively limiting them to rural roads is arbitrary and violative of Article 14 of Constitution.
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