'Witch-hunt': Gujarat Samachar owner on ED case

Ahmedabad: Leading vernacular daily Gujarat Samachar co-owner Bahubali Shah (73), while seeking regular bail, has claimed that the Enforcement Directorate (ED) case against him was a "witch hunt".

The ED arrested Shah on May 15 on charges of money laundering. Soon after, Shah was hospitalised and later sought bail on medical grounds, which the court granted.

Subsequently, he filed an application seeking regular bail.

The case against Shah is based on a 2016 complaint by the Securities Exchange Board of India (Sebi) in connection with illegality in the Initial Public Offer (IPO) of NTPC and TCS against the directors of private firms Excell Multitech Limited and Zenet Software Limited.

Claiming that the ED's action was a "clear case of witch-hunting and victimisation", Shah said: "There are several other persons/entities who are alleged to have provided finance to Sugandh, who have not been arrested so far, or even called for questioning or interrogation."

Shah has claimed that SEBI in its case didn't arraign him as an accused. "In fact, there is no mention of the Applicant herein in the said complaint at all of having participated directly or indirectly or having knowledge of the alleged offence committed...," Shah has said in the affidavit on Tuesday filed before a special designated PMLA court.

The affidavit was filed as a rejoinder against ED's affidavit which opposed the regular bail alleging financial fraud involving Shah.

Shah has challenged that predicate offence, based on which ED has launched money laundering investigation. He has said that ED's money laundering case "is wholly misconceived" as it is not even the case of the SEBI, which has filed the predicate offence against him.

Shah has also said that alleged offence is of the year 2004-2006 when section 12 (A) of the SEBI Act was not a predicate or scheduled offence. Therefore, ED couldn't have filed its case against him. Section 12A of the SEBI Act deals with fraudulent and unfair trade practices including market manipulation, insider trading, among others.

He has denied having paid "any finance whatsoever to M/s. Sugandh as alleged or otherwise or at all." He has claimed in the affidavit that "false and concocted allegations are sought to be levelled against the Petitioner only with an intention to victimize and harass the Petitioner."

ED, on the other hand, has alleged that Lok Prakashan Limited, the firm which publishes Gujarat Samachar, and Shreyanshbhai Shah, the brother of Bahubali and editor-in-chief of Gujarat Samachar, allegedly financed Excell Multitech Limited and Zenet Software Limited which in turn gave money to Sugandh Estates and and Investments Private Limited to corner the shares of TCS and NTPC as part of the alleged scam.

The ED has claimed that Lok Prakashan and Shreyansh Shah financed more than Rs27 crore to these two firms. The ledger copy of books of accounts of these firms also revealed that Lok Prakashan Limited received 6,46,922 shares of NTPC and 13,780 shares of TCS.