MUMBAI, June 15: The special court of justice SN Variava has disposed of the application of Bhupen Dalal in which the latter has alleged that Standard Chartered Bank has not lost all the money it claims to have lost in the securities scam and large funds came back to their coffers by way of a reverse inflow of funds."This vindicates our position as the application had no merit," said a spokesman for Stanchart. Stanchart however refused to comment further on the issue. Variava, while dealing with the application filed by Dalal, came down heavily on the Central Bureau of Investigation (CBI) and said that it should not investigate what it thinks right, but follow the orders of the court. Variava asked the CBI to investigate the role of Pesi Nat, the then chief of Stanchart in India, David Gardiner, Ravi Iyer and R Kannan, senior officials of Stanchart, in the securities scam. The special court has given the CBI time till September 15, 1998 to complete a fresh investigation.
The special court asked the CBIwhether it had examined the contents of Prakash Yardi's report and whether the bank had followed the legal opinion given by their legal advisors and added that the CBI should find out if the higher-ups in Stanchart took any steps to stop these transactions. The court further stated that the minutes of the weekly and fortnightly meetings of the senior officers should be examined by the CBI.
Reacting to the pleadings of KG Menon, counsel for Stanchart, that the court had no powers to order a re-investigation, Variava said that by a judgement of the Supreme Court in 1997, the court has the powers to order a re-investigation at any stage.
Variava stated that the court did not carry out its investigations as per his orders of October 8-9, 1996 and this time they should do it in `letter and in spirit'. The judge observed that CBI was only to look into the criminality of the transactions and is not concerned with the reverse flow of funds since it is to be considered as civil in nature.
According to thepetition filed by Dalal, the investigation conducted by the CBI so far is incomplete. The special court, by an order in October, 1996, asked the CBI to investigate the involvement of higher-ups in Stanchart.
Variava observed on several occasions that transactions of such big volumes could not have taken place without the knowledge of higher-ups in the bank.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
