Coming down heavily on former Ranbaxy promoters Malvinder and Shivinder Singh, who were personally present in the court on Friday, the Delhi High Court barred them from selling any of their assets without its approval and also asked them to furnish details of all their sold and gifted assets, including bank accounts, from April 2016. While freezing their bank accounts, justice Rajiv Shakhder also barred Malvinder Singh from selling his property in Singapore, which is currently mortgaged with DBS Bank.
Questioning the brothers in open court on bank accounts and properties in India and abroad, the bench asked them to reveal the assets sold since April 2016 before September 5, which is the next date of hearing. “They seem to be heading in the direction of saying that we don’t have any money… If they don’t have any money, they should declare insolvency, they can’t keep money away from the court… Half-truths have been given before us by the Singh brothers,” the judge told the two brothers.
“If they don’t cough up the money, they will go to jail,” the court observed.The HC also refused to stay the Fortis EGM scheduled on Monday and passing of any resolution on approving the IHH Healthcare deal, as sought by Japanese pharma major Daiichi. The HC had on August 1 asked the brothers to be personally present before it on August 10 to explain the discrepancies in their statements on their assets and shareholding in Fortis Healthcare and also if they had sufficient funds to satisfy Japanese pharma major Daiichi’s Rs 3,500-crore arbitration award against them.
Malvinder Singh during the hearing disclosed his ownership of an apartment in Singapore and expressed his inability to service monthly instalments for it. He said that the apartment will be sold. Besides, he revealed gifting a Rs 7-crore sculpture to his daughter in October 2017. Senior counsel Akhil Sibal, appearing for the Singh brothers, argued that the brothers have neither any direct shareholding in Fortis Healthcare nor any beneficial ownership of the much talked about RHT Trust based in Singapore. Besides, they don’t have any immovable properties in India, Sibal said.
The Singh brothers said they were trying to get an equity investor and Religare, with its insurance business, and Fortis were valuable entities. “If there’s an actual default, pledged shares are invoked to keep banks at bay,” they said. They denied having filed any affidavit with half truths. Senior counsel Arvind Nigam, appearing for Daiichi, argued that the duo have made a fool of everybody and had diluted their assets during the course of the trial. “More than 3 crore unencumbered shares were sold in 2017. FHL is the cash cow. They resigned from FHL in February, but controlled RHC and Oscar Investments even afterwards. They have stripped the company clean, 3.84 crore shares are gone, he said.”
In May 2016, Singapore’s arbitration tribunal had asked the brothers to pay damages of $400 million (Rs 2,562.78 crore) to Daiichi for concealing and misrepresenting information during their stake sale in 2008 to the Japanese firm. With interests and legal fees the payable amount now comes to around Rs 3,500 crore. Daiichi had then moved the HC for enforcement of the award to recover the damages from the brothers. The brothers had challenged this but lost.