Sucheta Dalal :Another arrest at SHCIL
Sucheta Dalal

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Another arrest at SHCIL  

Jun 20, 2007


The SHCIL saga continues

19 June 2006: On June 18 we reported that the Kolkata police, with help from their Mumbai counter parts had gone to the Stock Holding Corporation of India Limited (SHCIL) and arrested two senior executive vice presidents – Rohington Mewala and L.Vishwanathan. They were later produced before the metropolitan magistrate’s court and released on bail, but on the condition that they would present themselves before the appropriate jurisdictional court before July 2, 2007.  That gives them less than a fortnight to make the trip to Kolkata.


Exclusive !! Another arrest at SHCIL

20 June 2006: At around noon today the Kolkata police swooped again to arrest J.V.Murthy, a Vice President of SHCIL who had allegedly been avoiding a non-bailable warrant until now. He too was produced before the Metropolitan Magistrate. Murthy was the third among the four SHCIL executives accused in the Scam of 2000. However, he had left SHCIL in May 2006 and is no longer employed with the organisation. So far only the then SHCIL CEO and Managing Director  B.V.Goud had faced the heat of the police action.



20 June 2007: SHCIL is holding an Extraordinary General Meeting (EGM) today in order to induct new directors and remove some existing ones. Much of what is expected at this meeting has already been reported on this site. Watch this space!


Other action at SHCIL

20 June 2007: Things are hotting up regarding the main issue that I have been reporting for the last few months – about how SHCIL Services Limited (SSL), once a wholly owned subsidiary of SHCIL had neatly ousted the parent and reduced its holding to a mere 24%. All of a sudden, the entire media woke up to the bizarre activity that has been going on at SHCIL and reported the fact that it had filed a petition before the Company Law Board (CLB). The petition alleged that the management of SSL had “fraudulently” and “surreptitiously” diluted the SHCIL’s shareholding and carried major reports on 19 June.

In fact, SHCIL’s petition makes far more serious charges than these two and I have documented them in articles linked below. Moreover, based on a complaint by K.P.Krishnan, Joint Secretary, Ministry of Finance, the Company Law Board (CLB) passed an order reverting the shareholding to what it was when the company was originally set up. That order was passed on May 17, 2007 under Sec 250 (2) of the Companies Act.

But all this hectic activity only hides the fact that government continues to ignore the Central Vigilance Commission’s month-old recommendation to hand over the investigation to the CBI.  This is clearly protecting several individuals, even while the government is acting to reverse the damage caused by the shenanigans at SHCIL.

More on Kolkata Scam

20 June 2007: The arrests at SHCIL are causing fear among all those who were investigated by the Kolkata police for their market manipulation and collusion with various scamsters including Ketan Parekh and Dinesh Dalmia. After all, the Kolkata police, who have quite a record by their dogged investigation of the Scam of 2000, especially Dinesh Dalmia, are also not willing to relent on the many other brokers who colluded with scamster Ketan Parekh.

Apart from Harish Biyani, who is accused in the SHCIL related case; there is Ravindra Biyani, who has been absconding for the past seven years. Then there is Dinesh Singhania, former President of the Calcutta Stock Exchange.  One of his close associates Rajendra Kumar Jain, also charge-sheeted by the Kolkata police has recently moved court to have his passport released with the intention of going abroad. The court is understood to have rejected the request. Ironically, since the accused in that investigation are continuing to abscond it is helping the police keep up the pressure on those who were arrested and jailed during the early stages of the investigation.

Time: 3.32 p.m.

-- Sucheta Dalal