SC grants relief to Tech Mahindra in ED case

SC grants relief to Tech Mahindra in ED case

In a breather to Tech Mahindra, the Supreme Court today restrained for four months a trial court in Andhra Pradesh from framing charges against the IT services company in connection with Enforcement Directorate's proceedings in the Satyam accounting fraud case.

The case pertains to ED's attachment of fixed deposit worth Rs 822 crore belonging to the company and cases have been registered for alleged money laundering and foreign exchange violation.

A bench comprising Justices T S Thakur and R Banumathi asked the High Court at Hyderabad to expeditiously deal with the matter and dispose it of within the stipulated period.

Additional Solicitor General Maninder Singh, who was asked to assist the court in the matter, said since framing of charges could lead to international debarring of Tech Mahindra, the high court could be asked to consider the case expeditiously.

He submitted that Rs 822 crore of Satyam's money was still with the company as "crime proceeds", which prompted the ED to proceed against it.

Senior advocate Kapil Sibal, appearing for Tech Mahindra, denied any connection with Satyam Computers' B Ramalinga Raju and family which allegedly inflated shares by various financial operations.

However, Singh said the amalgamation took place by taking over all liabilities and prosecutions.

The high court had rightly ruled that the company should be impleaded in the criminal case, the ASG contended.

Sibal said Tech Mahindra bought the scam-tainted company for about Rs 2,890 crore and there was no connection with around Rs 800 crore which is the subject matter of offences under the Prevention of Money Laundering Act.

Tech Mahindra has appealed against a two-judge bench order of the high court which had allowed a special court hearing criminal cases arising out of the Satyam scam to frame charges against Tech Mahindra.

Earlier, a single judge of the high court had held that ED could not initiate proceedings against Tech Mahindra.

Sibal had contended that it was not in existence when the money laundering allegations came to light.

The company has contended that the charge under Sections 3 and 4 of the Prevention of Money Laundering Act (PMLA) was on a "misconceived basis" that it was "in possession" of proceeds of crime.

"It (company) is the victim of an unprecedented fraud perpetrated by its former chairman B Ramalinga Raju and his associates," the petition said.

ED had attached the accounts of SCSL (formerly Satyam Computer Services Ltd) after it was found in the probe that Raju and his associates "wrongfully" offloaded inflated shares of the said company by way of sale or pledging of shares.

Trial of loans derived from front companies revealed that Rs 822 crore out of Rs 2171.45 crore found their way to Satyam Computers and were used for day-to-day expenses like payment of salaries among others, ED had said.

Narendra Modi or Rahul Gandhi? Who will win the battle royale of the Lok Sabha Elections 2019


Get real-time news updates, views and analysis on Lok Sabha Elections 2019 on Deccanherald.com/news/lok-sabha-elections-2019 


Like us on Facebook or follow us on Twitter and Instagram with #DHPoliticalTheatre for live updates on the Indian general elections 2019.

Liked the story?

  • 0

    Happy
  • 0

    Amused
  • 0

    Sad
  • 0

    Frustrated
  • 0

    Angry