26 years on, ten accused acquitted
MUMBAI : Twenty six years after stockbroker Harshad Mehta-led securities scam shook the nation, the Bombay high court (HC) on Thursday acquitted seven officers of the State Bank of India (SBI) and State Bank of India Capital Markets Limited (SBI Caps) and three others of duping SBI Caps to the tune of ₹105 crore. This includes a share-broker attached to Mehta’s firm.
A special court of justice Shalini Phansalkar-joshi acquitted the accused after noticing that the Banking, Securities and Fraud division of the Central Bureau of Investigation (CBI) had completely failed to prove charges against them.
The CBI had alleged that the prime accused, Rama Sitharaman, C Ravi Kumar and Mehta, plotted a securities scam with others. As part of this, they cheated SBI Caps of ₹105 crore in sale and purchase transactions of securities from 1991-92. SBI Caps routed all 24 transactions via Mehta and suffered a loss.
The FIR was registered on the basis of a complaint filed by Janardan Bandopadhyay of SBI Caps, who was later arraigned as an accused. After CBI investigation, a more accused were added.
Though the CBI presented statements of 154 witnesses and thousands of documents to support its case, seven of the 17 accused were discharged for lack of evidence. Mehta’s trial was abated after he died in 2001.
The evidence submitted by the CBI, however, fell short of legal scrutiny and on Thursday, the accused were acquitted for want of cogent evidence. The judge was irked by the fact that the sanctions granted to prosecute the SBI officials under the Prevention of Corruption Act were mechanical. “They (sanctioning authority) have admitted (in their testimony) that they had no knowledge of money market transactions or securities transactions and had accorded the sanction mechanically,” the judge said.