The former promoters of Ranbaxy Malvinder Singh and his brother Shivinder Singh have been held guilty by the Supreme Court of contempt of court for violating its order asking them not to divest their shares in Fortis Healthcare Limited.
The case was filed by Japanese firm Daiichi Sankyo against the ex-Ranbaxy promoters accusing them of disposing their assets in violation of a court order to put on hold the acquisition of the the Malaysian group IHH Healthcare of their controlling stake in Fortis.
The top court had earlier asked the Singh brothers to come up with a plan to fulfill the arbitral award of Rs 3,500 crore granted by a Singapore tribunal against them. The Singh brothers were in 2016 asked to pay Rs 2,562 crore to Daiichi Sankyo to settle a dispute following the Japanese company’s acquisition of Ranbaxy around 10 years back.
Earlier, they challenged the decision in the Delhi High Court which reiterated that the Singapore tribunal’s award should be fulfilled.
The apex court said, Malvinder and Shivinder Singh can get away from contempt by depositing Rs. 1,175 crore each.
A bench comprising Chief Justice Ranjan Gogoi and Justice Deepak Gupta held the Singh brothers guilty of contempt of court and said that they had violated its earlier order by which the sale of their controlling stakes in Fortis Group to Malayasian firm IHH Healthcare was put on hold.
The apex court said that they would hear the Singhs on the quantum of sentence later.
The Japanese firm had filed contempt petition against the former Ranbaxy promoters alleging that execution of their arbitral award had been in jeopardy as the Singh brothers disposed of their controlling stakes in Fortis Group to the Malaysian firm.
Daiichi had charged the Singh brothers of hiding many facts during the sale of the company. One of them, being that the manufacturing plants of the company were facing severe regulatory issues with the US Food and Drug Administration.
Earlier, in October the former Fortis Healthcare promoter Malvinder Singh and his brother Shivinder Singh who is former Religare Enterprises limited promoter, were arrested by the Delhi Police on Friday arrested for allegedly misappropriating funds of Religare Finvest Limited (RFL) and causing losses to the tune of Rs 2,397 crore.
Malvinder’s brother Shivinder Mohan Singh, Sunil Godhwani (58), the former chairman and managing director of Religare Enterprises Limited (REL), Kavi Arora (48) and Anil Saxena, who occupied important positions in REL and RFL, were also arrested earlier by the Economic Offences Wing (EOW) of Delhi Police for allegedly diverting money and investing in other companies, they said.
RFL is a subsidiary of the REL, Shivinder and his elder brother Malvinder were earlier the promoters of REL.
The EOW had registered an FIR in March after it received a complaint from Manpreet Singh Suri of the RFL against Shivinder, Godhwani and others alleging that loans were taken by them while managing the firm but the money was invested in other companies.
(With inputs from PTI)