Religare: Singh brothers sent to 4-day police custody

Former promoters of pharmaceutical giant Ranbaxy, Shivinder Singh, his elder brother Malvinder Singh and three others arrested by the Economic Offences Wing (EOW) of Delhi Police for allegedly misappropriating funds of Religare Finvest Limited (RFL) to the tune of Rs 2,397 crore, in New Delhi, Friday, Oct. 11, 2019. (PTI Photo/Arun Sharma)

Religare former promoter-brothers Malvinder Singh and Shivinder Singh were on Friday sent to four-day police custody for further questioning in a Rs 2,397 crore loan fraud case with the court saying the offence was of "very serious nature".

Along with the Singhs, three others -- former Religare Enterprises Ltd (REL) Chairman and Managing Director Sunil Ghodwani, Kavi Arora and Anil Saxena, who occupied important managerial positions in REL and its subsidiary Religare Finvest Ltd (RFL) -- will also remain in police custody till then.

All five were arrested on Thursday following investigations into an FIR based on a complaint filed by REL last December after the Singh brothers exited the group earlier in 2018.

Police custody is necessary to "trace the trail of the cheated amount and find out the role of other persons who might have participated in the conspiracy and confrontation with the other officials of RFL and REL", Chief Metropolitan Magistrate Deepak Sherawat said in his order.

Religare has accused the brothers, who had absolute control on REL till they exited, of putting its subsidiary, RFL, on “poor financial condition” by way of disbursing “high-value purported loans to shell companies...controlled or associated” and later not repaying it.

While Shivinder did not oppose the police plea for custody, his estranged elder brother, Malvinder, opposed it, claiming that his custody was not required as the evidence was documentary. Malvinder's lawyer also told the court that the money was with Radha Soami Head Gurinder Singh Dhillon, a relative of Singhs' mother, and alleged that investigators were not going after him since he had political connections.

Malvinder has also approached the Delhi High Court on Friday seeking quashing of an FIR against him. The High Court has reserved order on whether to issue a notice to police on his plea.

The brothers had earlier claimed in the Delhi High Court that they could pay USD 500 million to Japanese pharma major Daiichi Sankyo, which bought their company Ranbaxy, after they get the money owed by others, including Dhillon, to their RHC Holdings. A Singapore Tribunal had, in 2016, passed the order in favour of Daiichi Sankyo saying that the brothers concealed information while selling the shares and the Delhi High Court and Supreme Court upheld it.

The Singhs had sold their shares in Ranbaxy to Daiichi Sankyo in 2008 for Rs 9,576.1 crore and Sun Pharmaceuticals Ltd later acquired the company from Daiichi.

Last month, the Delhi High Court directed Dhillon and 54 other people and entities to deposit the amount owed to RHC Holdings in connection with the execution of award won by Daiichi Sankyo against former promoters of Ranbaxy Laboratories -- Malvinder and Shivinder.

In another development on Friday, Dhillon and his family members approached the Delhi High Court saying they do not owe any money to RHC Holdings. They told the court that RHC Holdings has made false claims that they owe money to the company following which Justice J R Midha sought the response of RHC Holdings, the Singhs, who are also followers of Radha Soami sect, and Daiichi Sankyo. 

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