The Economic Offences Wing (EOW) of Chennai Police stated on Friday that it has arrested Ravi Parthasarathy, the previous Chairman of IL&FS Group, in the Rs 1 lakh crore rip-off, which triggered a liquidity disaster in the monetary providers market in 2018.
EOW DSP Prakash Babu confirmed to IANS that Parthasarthy has been arrested and brought into police custody for 15 days. He added that his bail listening to will come up for listening to on Monday.
Parthasarthy, the kingpin, mastermind and chief architect of the Rs 1 lakh crore IL&FS rip-off, has been arrested by the EOW in reference to Crime No. 13 of 2020, dated September 20, 2020, the EOW of Chennai Police stated in an announcement.
“The accused, Ravi Parthasarathy, is the former Chairman and Managing Director of the entire IL&FS Group. The IL&FS Group, which consists of more than 350 group companies, was used as a vehicle to perpetrate fraud by then management of IL&FS Group which was headed by the then Chairman and MD-CEO Ravi Parthasarathy,” stated the EOW.
The EOW acknowledged that the FIR has been registered in reference to the grievance given by 63 moons Technologies Ltd, which misplaced a sum of Rs 200 crore. Complaints from numerous different depositors have additionally been obtained by the EOW.
The anticipatory bail petition filed by the accused Parthasarathy in Crl OP No. 2007 of 2021 was additionally dismissed by the Madras High Court. Aggrieved depositors and buyers of IL&FS Transportation Networks India Ltd (ITNL) can ahead their claims to EOW, it added.
Notably, Parthasarathy, who is claimed to be the shut confidant of former Finance Minister P. Chidambarm, is accused of fraud with intent to injure the pursuits of the corporate, its shareholders and lenders, ensuing in wrongful loss to the corporate.
Under his stewardship, bother surfaced at IL&FS in the July-September quarter of 2018, when two of its subsidiaries began defaulting on reimbursement of loans and inter-corporate deposits to lenders.
Subsequent collection of defaults precipitated a systemic downside with many non-banking finance firms (NBFCs) operating into monetary points.
On October 1, 2018, the Central authorities took steps to take management of Infrastructure Leasing & Financial Services Limited (IL&FS) by way of a directive by the National Company Law Tribunal (NCLT) and arrest the unfold of the contagion to the monetary markets. A brand new board below the management of banker Uday Kotak was constituted as the sooner board was deemed to have did not discharge its duties.
The Government of India (GoI) in its petition has talked about, “Ravi Parthasarathy and his team were responsible for the negligence, incompetency and misleading the public by presenting rosy financial statements. IL&FS was camouflaging its financial statements by hiding a severe mismatch between its cash flows and payment obligations. It was also hiding total lack of liquidity and glaring adverse financial ratios.”
Parthasarathy, who was on the helm of IL&FS for over 25 years, is accused of masterminding one of many largest monetary frauds and systematically driving a behemoth of a monetary establishment to monetary ruins.
In addition to the premier investigating company, the Serious Fraud Investigation Office (SFIO), the Reserve Bank of India, the Ministry of Corporate Affairs (Union of India), the Registrar of Companies (RoC), the National Company Law Tribunal (NCLT), Mumbai, together with the Grant Thornton forensic report have made opposed findings in opposition to him.
The RoC has noticed mismanagement and compromise in company governance norms, whereas there may be one other FIR registered by the EOW-New Delhi in opposition to Parthasarathy and Hari Sankaran below numerous sections of IPC.
In one of the damaging findings, the GoI petition talked about, “IL&FS had created a trust known as the Employee Welfare Trust which was used as an instrument to enrich its directors at the cost of the Company. The said trust was used to perpetrate a fraud on IL&FS and its group companies. The trust owned 12 per cent of IL&FS Limited. Ravi Parthasarathy and certain other senior IL&FS personnel were major beneficiaries of the Trust.”
The RBI report, which it submitted on March 22, 2019, underlined that the most important function in perpetrating the fraud and monetary irregularity was performed by Parthasarathy throughout his tenure because the Group Chairman.
The report identified indiscriminate sanctioning of loans, flouting of RBI norms, fraudulent transactions to sure accounts, displaying inflated numbers of subsidiaries, battle of pursuits, and the focus of energy in the arms of few, which included Parthasarathy.
The SFIO grievance, dated May 30, 2019, named Parthasarathy because the prime accused. The report talked about that Parthasarathy was the important thing decision-maker in the IL&FS Group and used the group as his fiefdom.
Being the Chairman of IL&FS Group and Director of its numerous subsidiaries, the coterie led by Parthasarathy abused its place and diverted funds of its group firms.
It could also be famous that the NCLT-Mumbai order to recast the accounts of the IL&FS Group was challenged by Parthasarathy in the Supreme Court, which upheld the GoI choice.
The forensic audit by Grant Thornton additionally revealed a bevy of unlawful practices, bribing of credit standing companies and different fraudulent practices, indicating clearly the involvement of the then IL&FS Group Chairman Parthasarathy.
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