The Harshad Mehta case: Where time has overtaken justice by a mileBy Shailesh Menon & Maulik Vyas, ET Bureau | Jul 05, 2016, 09.38 AM IST
"The custodian is trying to demoralise us and weaken us financially," he had told the court, casting a glance at custodian's bench. He pleaded to the court to consider his 'scaling down' application which, he hopes, could bring down the "highpitched claims" of
IT Department.
If Ashwin sounded like a lawyer that day, it was because he had become one. He had secured a degree in law in his mid50s to mount a determined fight against creditors.
That one of the protagonists of a case was able to secure a law degree also underscores a painful specialty of India's legal system — the achingly slow slog of cases in courts.
Even the securities scam — epic in scale and consequences — has been wrenched in courts for over a quarter of a century. Ashwin, now in his late 50s, does not socialise much these days. He does not answer curious queries about his long dead brother or the case.
Time had driven a wedge, but Ashwin managed to hold the family together. He has also done well to keep creditors at bay. "Nobody knows the case better than Ashwin," says the lawyer of one of the interested parties in the Harshad Mehta case.
Ashwin Mehta's tryst with judiciary began twoandahalf decades ago, immediately after his fasttalking highroller brother Harshad got caught first in a seemingly small payment crisis, and then in the mammoth scam involving a swathe of banks, highflying bankers and market wizards.
In the initial years of the case, Harshad and his brothers — inured to expensive cars and swanky apartment blocks — hired the most expensive lawyers in the country. No less than Ram Jethmalani was engaged to beachhead the 70odd criminal cases lodged against the Mehta family.
"The Harshad Mehta Case catapulted the status of Mumbai based lawyers," reminisces veteran lawyer Rohit Kapadia, who appeared for National Housing Bank in the Harshad Mehta scam case.
"This was the first time they started charging Rs 1 lakh per appearance. That kind of money was not billed by even the most successful of Supreme Court lawyers."
The protracted legal battle, however, called for changes. Gone was the flamboyance, to be replaced by pragmatism.
One reason could be the death of Harshad Mehta 15 years ago. All through the first decade of the millennium, the Mehta family appointed lesser known lawyers, who would not attach 'personal brand value' to their fees.
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Ashwin Mehta-The Big Bull is long dead and his brother has had time to become a lawyer and argue
his case. Banks and financial institutions are yet to get their money back. The 1992 stock market scandal shook the nation, but the wheels of justice grind slow, write Shailesh Menon and Maulik Vyas.
One muggy afternoon a few years ago, after another hectic day in a Mumbai court, Ashwin Mehta walked up to the lawyers of the opposite camp, which represented a bunch of banks and financial institutions.
"Please do not worry... I'll return all your money.Even after paying you all, I'll have a little over Rs 1,000 crore to take home," he said in his typical measured soft tone.
He then walked away, his head downcast, refusing to meet the eyes of people passing by.
Ashwin is the brother of Big Bull Harshad Mehta — the kingpin of the 1992 securities scam — which rocked the nation, rattled the markets and triggered a series of reforms in the stock market. He had poured his heart out that day in the Special Court, set up to punish the guilty and ensure speedy recovery of money swindled by Harshad Mehta and
a few other brokers (see Recap of Scam at the end of this article).
Much of Ashwin's ire was directed at the custodian the court had appointed to recover and attach assets, properties and "recoverables" of all parties named in the scam.
The Harshad Mehta case can only end in stages.
his case. Banks and financial institutions are yet to get their money back. The 1992 stock market scandal shook the nation, but the wheels of justice grind slow, write Shailesh Menon and Maulik Vyas.
One muggy afternoon a few years ago, after another hectic day in a Mumbai court, Ashwin Mehta walked up to the lawyers of the opposite camp, which represented a bunch of banks and financial institutions.
"Please do not worry... I'll return all your money.Even after paying you all, I'll have a little over Rs 1,000 crore to take home," he said in his typical measured soft tone.
He then walked away, his head downcast, refusing to meet the eyes of people passing by.
Ashwin is the brother of Big Bull Harshad Mehta — the kingpin of the 1992 securities scam — which rocked the nation, rattled the markets and triggered a series of reforms in the stock market. He had poured his heart out that day in the Special Court, set up to punish the guilty and ensure speedy recovery of money swindled by Harshad Mehta and
a few other brokers (see Recap of Scam at the end of this article).
Much of Ashwin's ire was directed at the custodian the court had appointed to recover and attach assets, properties and "recoverables" of all parties named in the scam.
The Harshad Mehta case can only end in stages.
Firstly, the IT Department will have to reassess its claims and come up with a figure that is agreeable to all parties.
In pic: Ram Jethmalani with Harshad Mehta
"The custodian is trying to demoralise us and weaken us financially," he had told the court, casting a glance at custodian's bench. He pleaded to the court to consider his 'scaling down' application which, he hopes, could bring down the "highpitched claims" of
IT Department.
If Ashwin sounded like a lawyer that day, it was because he had become one. He had secured a degree in law in his mid50s to mount a determined fight against creditors.
That one of the protagonists of a case was able to secure a law degree also underscores a painful specialty of India's legal system — the achingly slow slog of cases in courts.
Even the securities scam — epic in scale and consequences — has been wrenched in courts for over a quarter of a century. Ashwin, now in his late 50s, does not socialise much these days. He does not answer curious queries about his long dead brother or the case.
Time had driven a wedge, but Ashwin managed to hold the family together. He has also done well to keep creditors at bay. "Nobody knows the case better than Ashwin," says the lawyer of one of the interested parties in the Harshad Mehta case.
Ashwin Mehta's tryst with judiciary began twoandahalf decades ago, immediately after his fasttalking highroller brother Harshad got caught first in a seemingly small payment crisis, and then in the mammoth scam involving a swathe of banks, highflying bankers and market wizards.
In the initial years of the case, Harshad and his brothers — inured to expensive cars and swanky apartment blocks — hired the most expensive lawyers in the country. No less than Ram Jethmalani was engaged to beachhead the 70odd criminal cases lodged against the Mehta family.
"The Harshad Mehta Case catapulted the status of Mumbai based lawyers," reminisces veteran lawyer Rohit Kapadia, who appeared for National Housing Bank in the Harshad Mehta scam case.
"This was the first time they started charging Rs 1 lakh per appearance. That kind of money was not billed by even the most successful of Supreme Court lawyers."
The protracted legal battle, however, called for changes. Gone was the flamboyance, to be replaced by pragmatism.
One reason could be the death of Harshad Mehta 15 years ago. All through the first decade of the millennium, the Mehta family appointed lesser known lawyers, who would not attach 'personal brand value' to their fees.
In the interim, Ashwin Mehta managed to get a law degree.
"Right from day one, he used to draft all matters. I used to merely argue for him," says IH Syed, an Ahmedabad based senior lawyer, who represented the family for some time.
A FIGHT TO THE FINISH
The Special Court was instituted through an Ordinance on June 6, 1992 (known as 'Special Court (Trial of Offences Relating to Transactions in Securities) Ordinance'.
The CBI filed charges against other brokers namely AD Narottam, Bhupen Dalal, Hiten Dalal and Naresh Aggarwal, among others, for partaking in the scam, albeit for much smaller sums of money.
Some of these cases are still being pursued by the parties concerned. The Harshad Mehta case stands out purely on account of its magnitude — the sum of money and the profile of the accused.
The courtappointed custodian has been at its job for over 24 years now. Periodically, the custodian files a confidential report valuing the property under its custody and liabilities to be paid off.
According to the custodian's report (number 26), released on January 8, 2016, the Harshad Mehta family has assets worth Rs 1,723.84 crore and total liabilities of around Rs 16,044 crore. The family has to pay 4662 crore to various banks and about Rs 11,174 crore to IT Department (mainly interest accrued and penalties).
As on September 2015, the banks were decreed (by Court) to get Rs 1,688 crore, out of which Rs 1,074 crore has already been paid on condition that sum (or part of the sum) would be returned if court ask them to do so. The banks' outstanding claim of Rs 4662 crore is mostly interest charged over the years. (see charts)
The bone of contention, if one goes by Ashwin Mehta's court submissions, is the "high-pitched claims" made by IT Department in its assessment reports. According to Mehta, the IT department has calculated tax liability purely taking into account the revenues of Harshad Mehta (and his affiliate companies) — and not his income.
Harshad Mehta was a broker with significant clientele in the 90s. When the scam erupted, the valuers seemingly failed to segregate Harshad Mehta's client trades and personal dealings. All trades done between 1991 and 1992 were clubbed as Harshad's personal trades and taxed accordingly, at higher tax slabs prevalent in the 90s.
That said, the valuers cannot be blamed as Harshad Mehta did not keep a neat book of accounts. There was no legible way for valuers to distinguish between Harshad's personal and client trades.
The books were in such a mess that even court responses (for Harshad's defence) had to be filed probing the memories of Mehta and his associates.
"The Custodian had taken the documents. We would prepare applications for filing in the Special Court from memory of our clients names and particulars of banks, securities, volumes and trade dates," says Anand Desai, managing partner of DSK Legal, who
represented the Mehta family. (cleared quote by desai).
No Quick End In Sight
The Harshad Mehta case can only end in stages. Firstly, the IT Department will have to reassess its claims and come up with a figure that is agreeable to all parties.
But again that looks difficult as no senior IT official would want to lower the tax claims for fear of future government level enquiries.
Secondly, Ashwin Mehta has time and again contested the asset valuation reports presented by the custodian. According to Mehta, the custodian has undervalued Mehta assets by a wide measure. At one point, Ashwin even argued that the custodian caused
him losses worth Rs 8000 crore.
Ashwin Mehta contests that the custodian has not taken into consideration income such as TDS refunds.
The custodian, according to him, has not managed to recover Harshad Mehta family's shares in companies like ACC and Apollo Tyres worth Rs 300 crore and Rs 233 crore respectively.
Harshad Mehta had two three store rooms filled with share certificates and related documents, affirms a lawyer who knew Harshad Mehta even before the scam was uncovered.
Another task of the custodian was to account for and recover money and shares due to Harshad Mehta Family. The custodian has failed to gather the assets of the family, Ashwin says.
Here, however, one cannot blame the custodian as Harshad Mehta held shares worth Rs.453 crore across 131 companies in benami accounts (value as on June 1995, as mentioned in a court submission).
When the scam came to light in 1992, the benami account holders sold shares held in their names and refused to cooperate with the custodian. The valuers had very little means to link up benami accounts with Harshad Mehta.
But Ashwin is not willing to buy this argument. "I've got more assets than liabilities... The custodian's accounting is not done properly. It has failed to vouch for the accuracy of the reported numbers," he reiterates in his reply to the recent custodian's report.
A CASE GONE TOO LONG
In 1992, when the scam came into light, 76 criminal cases and over 600 civil suits were filed against Harshad Mehta and his family. That apart, several banks and financial institutions had lodged cases against each other for getting their money back. Most
criminal cases against Harshad Mehta and his family have been dropped, but civil cases remain.
"It's normal for civil cases to go on for 30 40 years," the lawyers opine. But that does not augur well for cases pertaining to economic offences and scams, which have wider repercussions.
"The Harshad Mehta case had a bearing on the banking system and stock markets, and should have got resolved expeditiously," adds Anand Desai.
Cases concerning economic offences and scams are ring fenced legally and settled at the shortest time possible in developed countries. Take for one, the Raj Rajrathnam (of Galleon Group hedge fund) insider trading case, which was wrapped up in about three
years' time.
The Societe Generale unauthorised trading case of 2008, involving rogue trader Jerome Kerviel, was tied up in over two years' time. Back home, the Satyam scandal was settled in a record three years' time.
"In Satyam, there was no legal case. We had to just go in, clean up the book and make operations more transparent," explains Deepak Parekh, chairman of HDFC, who was a member of the panel appointed to clear up the mess.
"Harshad Mehta case is different as courts had a lot of work to do. But then, the case should not have dragged so long. This shows our legal system is slow and overburdened," says Parekh.
Frequent litigation by the family has also delayed the case inexplicably. The case is now being fought on over a dozen fronts with every individual member in the Mehta family approaching the courts for reprieve on various matters.
The creditors, on their part, are now trying for an order which would club all family members as one entity. This is being contested by the family.
"There's nothing like Harshad Mehta group... all of us are separate and distinct," Ashwin Mehta has submitted before the court.
The family members are trying to stay separate and protect their assets from being attached to pay off Harshad Mehta's liabilities.
It is another matter that Harshad conducted trades on their behalf in the early90s. Some of the family members — all housewives — bear outstanding income tax claims as high as Rs 21 crore between 1990 and 1994.
"They're housewives having no independent source of income. It's impossible for such persons to have such huge amounts of money unless they were beneficiaries of monies diverted by late Harshad Mehta," observes a Supreme Court judgment of 2011.
Out of all pending matters in the Special Court, over 70% are concerned with the Harshad Mehta Case. Former custodian Satish Loomba says the case should be treated as one batch case and disposed off.
"The family objects to any judgment given by the court... In this case, all should be held liable as one group. If that happens, the closure would come fast."
Trouble is, according to lawyers, even courts have stopped taking the case seriously. Some say the country has moved on. "The judges have to consider such cases with more sensitivity," says senior advocate & Parliament member Majeed Memon.
Lalit Bhasin, president of the Society of Indian Law Firms, feels the need to overhaul our legal system. "If you've not been able to solve the case in 25 years, it has to go favouring the accused. The case should be given a decent burial," Bhasin adds.
The Harshad Mehta case has dragged on for too long. For almost everybody, except those involved in it for pecuniary reasons, this case has lost its relevance.
The mastermind is long dead. Witnesses, documents and evidence have become irrelevant. This is one case where time has overtaken justice by a mile.
A RECAP OF THE SCAM
Who was Harshad Mehta? Harshad Mehta was a wellknown stock broker, alleged to have manipulated the stock market in 1992 by drawing out funds from banks fraudulently.
Some finance experts believe, Harshad Mehta did not commit any fraud, "he simply exploited loopholes in the system," they opine.
What's the securities scam? The securities scam of 1991-92 refers to a diversion of bank funds worth Rs 3500 crore to a clutch of stockbrokers the kingpin being Bombay-based broker Harshad Mehta. The funds thus drawn out were funnelled into the stock
market. Partly, this caused the market (Sensex) to surge to over 4500 points. It is said, stocks like ACC surged from about Rs 200 per share to about Rs 9000 apiece during this period.
How was the scam carried out? Harshad Mehta and his associates and a few other brokers siphoned off funds from inter bank transactions and bought shares across sectors, resulting in a stupendous rise in Sensex.
"Right from day one, he used to draft all matters. I used to merely argue for him," says IH Syed, an Ahmedabad based senior lawyer, who represented the family for some time.
A FIGHT TO THE FINISH
The Special Court was instituted through an Ordinance on June 6, 1992 (known as 'Special Court (Trial of Offences Relating to Transactions in Securities) Ordinance'.
The CBI filed charges against other brokers namely AD Narottam, Bhupen Dalal, Hiten Dalal and Naresh Aggarwal, among others, for partaking in the scam, albeit for much smaller sums of money.
Some of these cases are still being pursued by the parties concerned. The Harshad Mehta case stands out purely on account of its magnitude — the sum of money and the profile of the accused.
The courtappointed custodian has been at its job for over 24 years now. Periodically, the custodian files a confidential report valuing the property under its custody and liabilities to be paid off.
According to the custodian's report (number 26), released on January 8, 2016, the Harshad Mehta family has assets worth Rs 1,723.84 crore and total liabilities of around Rs 16,044 crore. The family has to pay 4662 crore to various banks and about Rs 11,174 crore to IT Department (mainly interest accrued and penalties).
As on September 2015, the banks were decreed (by Court) to get Rs 1,688 crore, out of which Rs 1,074 crore has already been paid on condition that sum (or part of the sum) would be returned if court ask them to do so. The banks' outstanding claim of Rs 4662 crore is mostly interest charged over the years. (see charts)
The bone of contention, if one goes by Ashwin Mehta's court submissions, is the "high-pitched claims" made by IT Department in its assessment reports. According to Mehta, the IT department has calculated tax liability purely taking into account the revenues of Harshad Mehta (and his affiliate companies) — and not his income.
Harshad Mehta was a broker with significant clientele in the 90s. When the scam erupted, the valuers seemingly failed to segregate Harshad Mehta's client trades and personal dealings. All trades done between 1991 and 1992 were clubbed as Harshad's personal trades and taxed accordingly, at higher tax slabs prevalent in the 90s.
That said, the valuers cannot be blamed as Harshad Mehta did not keep a neat book of accounts. There was no legible way for valuers to distinguish between Harshad's personal and client trades.
The books were in such a mess that even court responses (for Harshad's defence) had to be filed probing the memories of Mehta and his associates.
"The Custodian had taken the documents. We would prepare applications for filing in the Special Court from memory of our clients names and particulars of banks, securities, volumes and trade dates," says Anand Desai, managing partner of DSK Legal, who
represented the Mehta family. (cleared quote by desai).
No Quick End In Sight
The Harshad Mehta case can only end in stages. Firstly, the IT Department will have to reassess its claims and come up with a figure that is agreeable to all parties.
But again that looks difficult as no senior IT official would want to lower the tax claims for fear of future government level enquiries.
Secondly, Ashwin Mehta has time and again contested the asset valuation reports presented by the custodian. According to Mehta, the custodian has undervalued Mehta assets by a wide measure. At one point, Ashwin even argued that the custodian caused
him losses worth Rs 8000 crore.
Ashwin Mehta contests that the custodian has not taken into consideration income such as TDS refunds.
The custodian, according to him, has not managed to recover Harshad Mehta family's shares in companies like ACC and Apollo Tyres worth Rs 300 crore and Rs 233 crore respectively.
Harshad Mehta had two three store rooms filled with share certificates and related documents, affirms a lawyer who knew Harshad Mehta even before the scam was uncovered.
Another task of the custodian was to account for and recover money and shares due to Harshad Mehta Family. The custodian has failed to gather the assets of the family, Ashwin says.
Here, however, one cannot blame the custodian as Harshad Mehta held shares worth Rs.453 crore across 131 companies in benami accounts (value as on June 1995, as mentioned in a court submission).
When the scam came to light in 1992, the benami account holders sold shares held in their names and refused to cooperate with the custodian. The valuers had very little means to link up benami accounts with Harshad Mehta.
But Ashwin is not willing to buy this argument. "I've got more assets than liabilities... The custodian's accounting is not done properly. It has failed to vouch for the accuracy of the reported numbers," he reiterates in his reply to the recent custodian's report.
A CASE GONE TOO LONG
In 1992, when the scam came into light, 76 criminal cases and over 600 civil suits were filed against Harshad Mehta and his family. That apart, several banks and financial institutions had lodged cases against each other for getting their money back. Most
criminal cases against Harshad Mehta and his family have been dropped, but civil cases remain.
"It's normal for civil cases to go on for 30 40 years," the lawyers opine. But that does not augur well for cases pertaining to economic offences and scams, which have wider repercussions.
"The Harshad Mehta case had a bearing on the banking system and stock markets, and should have got resolved expeditiously," adds Anand Desai.
Cases concerning economic offences and scams are ring fenced legally and settled at the shortest time possible in developed countries. Take for one, the Raj Rajrathnam (of Galleon Group hedge fund) insider trading case, which was wrapped up in about three
years' time.
The Societe Generale unauthorised trading case of 2008, involving rogue trader Jerome Kerviel, was tied up in over two years' time. Back home, the Satyam scandal was settled in a record three years' time.
"In Satyam, there was no legal case. We had to just go in, clean up the book and make operations more transparent," explains Deepak Parekh, chairman of HDFC, who was a member of the panel appointed to clear up the mess.
"Harshad Mehta case is different as courts had a lot of work to do. But then, the case should not have dragged so long. This shows our legal system is slow and overburdened," says Parekh.
Frequent litigation by the family has also delayed the case inexplicably. The case is now being fought on over a dozen fronts with every individual member in the Mehta family approaching the courts for reprieve on various matters.
The creditors, on their part, are now trying for an order which would club all family members as one entity. This is being contested by the family.
"There's nothing like Harshad Mehta group... all of us are separate and distinct," Ashwin Mehta has submitted before the court.
The family members are trying to stay separate and protect their assets from being attached to pay off Harshad Mehta's liabilities.
It is another matter that Harshad conducted trades on their behalf in the early90s. Some of the family members — all housewives — bear outstanding income tax claims as high as Rs 21 crore between 1990 and 1994.
"They're housewives having no independent source of income. It's impossible for such persons to have such huge amounts of money unless they were beneficiaries of monies diverted by late Harshad Mehta," observes a Supreme Court judgment of 2011.
Out of all pending matters in the Special Court, over 70% are concerned with the Harshad Mehta Case. Former custodian Satish Loomba says the case should be treated as one batch case and disposed off.
"The family objects to any judgment given by the court... In this case, all should be held liable as one group. If that happens, the closure would come fast."
Trouble is, according to lawyers, even courts have stopped taking the case seriously. Some say the country has moved on. "The judges have to consider such cases with more sensitivity," says senior advocate & Parliament member Majeed Memon.
Lalit Bhasin, president of the Society of Indian Law Firms, feels the need to overhaul our legal system. "If you've not been able to solve the case in 25 years, it has to go favouring the accused. The case should be given a decent burial," Bhasin adds.
The Harshad Mehta case has dragged on for too long. For almost everybody, except those involved in it for pecuniary reasons, this case has lost its relevance.
The mastermind is long dead. Witnesses, documents and evidence have become irrelevant. This is one case where time has overtaken justice by a mile.
A RECAP OF THE SCAM
Who was Harshad Mehta? Harshad Mehta was a wellknown stock broker, alleged to have manipulated the stock market in 1992 by drawing out funds from banks fraudulently.
Some finance experts believe, Harshad Mehta did not commit any fraud, "he simply exploited loopholes in the system," they opine.
What's the securities scam? The securities scam of 1991-92 refers to a diversion of bank funds worth Rs 3500 crore to a clutch of stockbrokers the kingpin being Bombay-based broker Harshad Mehta. The funds thus drawn out were funnelled into the stock
market. Partly, this caused the market (Sensex) to surge to over 4500 points. It is said, stocks like ACC surged from about Rs 200 per share to about Rs 9000 apiece during this period.
How was the scam carried out? Harshad Mehta and his associates and a few other brokers siphoned off funds from inter bank transactions and bought shares across sectors, resulting in a stupendous rise in Sensex.
Here's how they did it! (Explained loosely)
A The main "tool" in the hands of wily brokers those days was striking ready forward deals (RFD) between banks. An RFD is a secured short term 15day loan from one bank to another. The lending is done against government securities. The borrowing bank
actually sells the securities to the lending bank and buys them back at tenure, at a slightly higher price.
B The normal settlement process in GSecs is that the transacting banks make payments to each other and effect delivery of securities. In the scam, the delivery of securities and payments were made through a set of brokers. Here, only the broker would know the
parties on either side.
C The brokers perfected the method and started trading on their own account. They pretended to be undertaking the transactions on behalf of a bank to maintain a facade of legality.
D The brokers also used bank receipts (BRs) in lieu of securities that were traded. So in real terms, securities did not change hands, but only BRs did. A BR is also treated as a receipt for money received from the buyer of securities.
E The brokers colluded with a couple of banks which issued fake BRs ones without any security backing. Mehta collected fake BRs from these banks and passed on to other banks which paid him money under assumption that they were lending against securities.
This money was then diverted to stocks. The shares were sold at profits (thanks to pumped up markets) and the BR retired when it was time to return money to the bank.
Mehta struck such deals across banks and rolled the money at every payoutlevel.
What happened to Harshad Mehta?
Mehta was arrested by investigation agencies in November 1992. He was charged with over 70 criminal cases (mostly relating to bribery, cheating, forgery, criminal conspiracy and falsification of accounts) and over 600 civil action suits. In 1993, Mehta stirred up a storm when he publicly announced that he had paid Rs 1 crore to Prime Minister PV Narasimha Rao.
A The main "tool" in the hands of wily brokers those days was striking ready forward deals (RFD) between banks. An RFD is a secured short term 15day loan from one bank to another. The lending is done against government securities. The borrowing bank
actually sells the securities to the lending bank and buys them back at tenure, at a slightly higher price.
B The normal settlement process in GSecs is that the transacting banks make payments to each other and effect delivery of securities. In the scam, the delivery of securities and payments were made through a set of brokers. Here, only the broker would know the
parties on either side.
C The brokers perfected the method and started trading on their own account. They pretended to be undertaking the transactions on behalf of a bank to maintain a facade of legality.
D The brokers also used bank receipts (BRs) in lieu of securities that were traded. So in real terms, securities did not change hands, but only BRs did. A BR is also treated as a receipt for money received from the buyer of securities.
E The brokers colluded with a couple of banks which issued fake BRs ones without any security backing. Mehta collected fake BRs from these banks and passed on to other banks which paid him money under assumption that they were lending against securities.
This money was then diverted to stocks. The shares were sold at profits (thanks to pumped up markets) and the BR retired when it was time to return money to the bank.
Mehta struck such deals across banks and rolled the money at every payoutlevel.
What happened to Harshad Mehta?
Mehta was arrested by investigation agencies in November 1992. He was charged with over 70 criminal cases (mostly relating to bribery, cheating, forgery, criminal conspiracy and falsification of accounts) and over 600 civil action suits. In 1993, Mehta stirred up a storm when he publicly announced that he had paid Rs 1 crore to Prime Minister PV Narasimha Rao.
On 31 December 2001, at the age of 48, Mehta died with 27 cases still pending against him.
What happened to the cases?
All criminal cases against Harshad Mehta got disposed off a few years ago, but there are several civil cases awaiting final closure. The civil cases pertain to monies Mehta owes to different institutions.
What happened to the cases?
All criminal cases against Harshad Mehta got disposed off a few years ago, but there are several civil cases awaiting final closure. The civil cases pertain to monies Mehta owes to different institutions.
The Mehta family led by Ashwin Mehta, who also represents the family in court is fighting the case at various levels right from reducing their net liabilities to safeguarding family assets from recovery and liquidation.
What's the custodian's role in Harshad Mehta case?
The court appointed a custodian to attach properties and receivables of Harshad Mehta and redistribute the same to creditors and other court decreed parties. The custodian has been managing the attached assets of Mehta for the last 24 years.
What's the custodian's role in Harshad Mehta case?
The court appointed a custodian to attach properties and receivables of Harshad Mehta and redistribute the same to creditors and other court decreed parties. The custodian has been managing the attached assets of Mehta for the last 24 years.
Informative blog, thanks for sharing.
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