The Supreme Court on Friday confirmed the interim protection from arrest granted to Mohan Steel Ltd’s former directors Mohan Krishna Kejriwal, Gopal Kejriwal, and Krishna Kejriwal, in connection with a case linked to an alleged company fraud of ₹7,500 crore involving the Rotomac Group.
A bench of justices Sanjay Kishan Kaul and AS Oka said the applicants have been cooperating with the investigation and that there is no fresh accusation against any of them while confirming the interim relief.
Representing the Kejriwals, senior advocate Siddhartha Dave submitted that the statement of Mohan Krishna Kejriwal had been recorded and that other petitioners were never summoned by the investigating agency for recording theirs.
Assisted by a team of lawyers from Karanjawala & Co, Dave added all other co-accused have also been granted bail in the matter, which pertained to an alleged pecuniary loss of ₹7,500 crore caused to a consortium of 14 banks, in which the Promoters and Directors of the Rotomac Group and Frost International Limited are also facing trial. Dave said the petitioners ran a steel mill and they owed no money to any bank.
The Serious Fraud Investigation Office (SFIO) led an investigation into the Rotomac Group and filed a complaint in May 2020. The agency alleged the petitioners lent their companies to transactions that led to defrauding of banks by the Rotomac Group.
{{/usCountry}}The Serious Fraud Investigation Office (SFIO) led an investigation into the Rotomac Group and filed a complaint in May 2020. The agency alleged the petitioners lent their companies to transactions that led to defrauding of banks by the Rotomac Group.
{{/usCountry}}Both the Rotomac Group and Frost International have significant liabilities towards various public sector banks. SFIO has alleged the companies were indulging in round-tripping of funds by abusing the merchanting trade scheme. According to the SFIO, to obtain bank funds required for the same, they manipulated their financial statements and issued fictitious debit notes to many foreign entities, which were under their control.
The Rotomac Group and Frost International have an outstanding liabilities of around ₹4,000 crore and ₹3,500 crore towards 14 public sector banks against which they have reportedly defaulted.
On March 30, the court granted interim protection from arrest to the Kejriwals on the condition that they will continue assisting the investigators. On Friday, the bench wrapped up the proceedings after confirming the interim relief.