Covid-19 Impact: Two former senior executives of IL&FS get bail

A Mumbai sessions court granted interim bail to former Infrastructure Leasing & Financial Services (IL&FS) vice chairman Hari Sankaran and former managing Director of IL&FS Financial Services Ramesh Bawa on Friday, accepting the Covid-19 outbreak as a valid reason for providing relief to the duo accused in a case of alleged fraud. However, the court refused to grant relief to Yes Bank co-founder Rana Kapoor, who had sought interim bail on similar grounds.
“Considering the medical history of the patients (Sankaran and Bawa) as well as considering the prevailing situation in the country of Covid-19, I allow temporary bail application,” judge PR Sitre said in his order, a copy of which was seen by ET. “The temporary bail automatically stands cancelled after expiry of the said 75 days. The applicant is directed to surrender before this court on or before expiry of the said 75 days.”

Sankaran and Bawa had been behind bars since April last year, when they were arrested by the Serious Fraud Investigation Office (SFIO) under the Companies Act for causing fraud and for issues related to corporate governance.

They had filed separate applications last week seeking interim bail on the grounds of the Covid-19 outbreak and their age. While Sankaran is 60 years old, Bawa is 68. The two had filed applications claiming that they were facing medical emergency arising out of various diseases and disorders.

Special public prosecutor Hiten Venagaonkar, appearing for the SFIO, contested the bail but the judge accepted the plea. The counsel for defence, Abad Ponda, told ET that the two were granted bail on bail bonds of Rs 30,000 each. “Considering their age and medical history there are chances that they get infected in jail. Considering the prevailing situation of Covid-19, they pray to be released on temporary bail,” Ponda argued before the court. The two are also required to surrender their passports before the investigating officer.

At least three agencies, including the Enforcement Directorate (ED) and Delhi Police, are probing the alleged irregularities at IL&FS and its subsidiaries. In June last year, the ED had arrested former directors of IFIN Arun Saha and Karunakaran Ramchand.

According to the SFIO charge sheet, six executives – Ravi Parthasarathy, Hari Sankaran, Ramesh Bawa, Arun Saha, Vibhav Kapoor and Karunakaran Ramchand – had formed the “coterie” that allegedly committed fraud with an intent to injure the interest of IFIN, its shareholders and creditors, resulting in wrongful loss to the company.

Meanwhile, on Friday, judge Sitre declined to grant similar relief to Rana Kapoor, who was arrested in March on charges of money laundering by ED. “On perusal of the document as well as medical certificates filed by Taloja jail authority clearly read that the applicant is not suffering from diseases which are dangerous to his life,” judge Sitre said in his order. “The jail authority is in position to look after the Covid-19 emergency. The applicant was arrested on March 8 and the investigation is at the initial stage... temporary bail is rejected.”

In another case, Frost International director Sujay Desai, who was arrested along with Rotomac Group promoter Rahul Kothari by the SFIO last month in connection with an alleged fraud of Rs 7,500 crore caused to a consortium of 14 banks, had filed a writ petition before the Supreme Court seeking bail citing Covid-19. The apex court, while disposing of the application, directed the applicant to approach the Allahabad High Court.