Chennai Spl court returns Ravi Parthasarathy to custody in Rs 1L scam cr IL&FS
A special court remanded Ravi Ramaswami Parthasarathy to three-day custody in connection with the 1 lakh crore Infrastructure Leasing and Finance Limited (IL&FS) scam, which sparked a liquidity crisis in the financial services market in 2018.
Before the special judge’s court under Tamil Nadu’s Protection of Depositors’ Interests (in Financial Institutions) Act 1997, EOW-Chennai said the custody questioning could reveal various crucial facts that are relevant to of his exclusive domain, being the key management personnel directly involved and responsible for the affairs of the IL&FS scam and active conspirator in all this matter.
“This is a gigantic scam involving huge sums of money which have been embezzled / embezzled by the accused in collusion with other people.”
“His pre-trial detention is the necessity of the hour and in the interests of the investigation under the Protection of Interests of Deponents of Tamil Nadu offense, 1997 and other IPC offenses, to ensure the purposes of the justice, ”the EOW-Chennai remand note said.
Seeking the removal of Ravi Parthasarathy from the Court of Special Judge under Articles 420, 409, 120B r / w 109 IPC, the EOW called the case “one of the biggest economic frauds in the history of our country”.
“The IL&FS group has defaulted on various creditors through calculated fraud and the total default to all creditors is about a staggering 1 lakh crore,” the referral note added. .
“Given the nature, gravity, gravity and scope of the case, this court is of the opinion that police custody must be ordered in the interests of justice in order to allow the ‘investigative agency to effectively deepen the investigation, “said the special judge. while granting police detention for three days to the accused from June 16.
The Chennai Police Economic Offenses Wing (EOW-Chennai) arrested the boss and mastermind of the Mumbai scam on June 9 based on a complaint filed by 63 moons technologies limited. On June 14, Ravi Parthasarthy was placed in judicial detention for 15 days.
Parthasarathy, reportedly a close confidant of former finance minister P. Chidambaram, is accused of using IL&FS, which consists of more than 350 group companies, as a vehicle to perpetrate massive fraud, floating non-convertible bonds (NCD) collect deposits from investors with the lure of high yields and illegally siphon off several hundred crore rupees.
After avoiding several summons from EOW-Chennai, Parthasarathy had moved Madras high school to seek early bail and the cancellation of the FIR filed against him under various sections. The Madras High Court overturned his half-baked defense of ill health and ceased to be the president of IL & FS as of 2017, clearing the way for EOW-Chennai to arrest him.
Making a very powerful statement, the footnote stressed that the Indian Union had to intervene since the activities of the IL&FS group affected the interests of the Indian economy. Companies were created as a vehicle for fraud and innocent depositors were cheated and their livelihoods taken away from them due to the fraud committed by Parthasarathy, whom he called “Kingpin and Mastermind”.
Ravi Parthasarathy became Chairman of the Board of IL&FS Group in 2004. He has been Chairman and CEO of IL&FS Group since 1989, making it clear that he has been leading the business of IL&FS Group for over 30 years since. its beginning. Since then, Parthasarathy controlled the arm and mind of the IL&FS group and he was responsible for running its day-to-day affairs and played a major role in the scam.
The first investigation report (FIR) was filed by 63 moons to recover its investment of Rs 200 crore in NTMs states that in 2018 or around 2018, the IL&FS group defaulted in its debts / financial obligations and is in default since then, which has put an end to all scandalous activities of IL&FS Group and its key executives, including Ravi Parthasarathy. The company itself had admitted massive liability of Rs 91,000 crore to various investors and creditors.
The Serious Fraud Investigating Officer (SFIO) named Ravi Parthasarathy as the lead accused and mentioned him as the lead decision maker of the IL&FS group, which used the group as his stronghold. Being chairman of the IL&FS group and director of its various subsidiaries, he noted, the coterie led by Parthasarathy abused its position and embezzled funds from companies in his group.
In one of the more damaging findings, the Indian government’s petition stated: “IL&FS had created a trust known as the Employee Welfare Trust which was used as an instrument to enrich its directors to the detriment of the company. The trust was used to perpetrate fraud on IL&FS and its affiliates. The trust owned 12% of IL & FS Limited. Ravi Parthasarathy and some other senior IL&FS executives were the primary beneficiaries of the trust.
The RBI report pointed out that the major role in the commission of fraud and financial irregularity was played by Parthasarathy during his tenure as chairman of the group. The report noted indiscriminate sanctions against loans, embezzlement, disregard for RBI standards, fraudulent transactions on certain accounts, showing an inflated number of subsidiaries, conflicts of interest and a concentration of power between hands of a few, including Ravi Parthasarathy and his coterie.
In 2019, NCLT-Mumbai took note of the main findings of the SFIO interim report on how the IL&FS group was conducting business against the public interest. He noted that the Administrative Committee (COD) of the now suspended IL&FS Group Board of Directors had abused its powers. Through various acts, including back door transactions, the debt burden within the IL&FS group has increased.
Indian Union had filed corporate petition No.3638 of 2018 under Sections 241 and 242 of Companies Act requesting suspension of IL & FS Board of Directors under Section 242 (2) (k) of the Companies Act. In the petition, the Indian Union notably stated that Ravi Parthasarthy and his team were responsible for the public’s negligence, incompetence and deception by presenting rosy financial statements. “IL&FS was camouflaging its financial statements by hiding a serious mismatch between its cash flow and its payment obligations. It was also hiding a complete lack of liquidity and glaring unfavorable financial ratios,” the petition adds.