New Delhi, July 3: Rita Singh, the high-profile promoter and managing director of the Mesco group, was arrested on Saturday by the Central Bureau of Investigation. Her arrest comes nearly six weeks after her husband and Mesco group chairman JK Singh and his nephew Deepak Singh were taken into custody by the CBI on charges of fraud, forgery and cheating.Rita Singh was produced before a designated court on Saturday and was remanded to police custody till July 5. Before the group ran into financial trouble--leading to investigations by the CBI and the income-tax department--Singh was considered the most high-profile business woman in the country who transformed a small dairy business, which she started as a housewife, into a large business empire with interests in exports, steel, aviation and pharmaceuticals.
The CBI has alleged that the group indulged in cheating insurance companies, financial institutions and banks. The amount of misappropriation has been estimated at over Rs 125 crore. The CBI has also charged the group with cheating the public by issuing fake shares.
No company spokesman was available for comment on the developments or the allegations. However, a statement on plain paper, with Rita Singh's name appearing at the end (but without signature) was faxed to this newspaper denying all charges made against the group. The statement said Rita Singh would be available to answer any queries at Tis Hazari court on July 5.
The CBI has alleged that Singh's company Mideast (India) Ltd had cheated United India Insurance Company by making insurance claims of Rs 12 crore by submitting a false "no-objection certificate" (NOC) supposed to have been issued by the Industrial Finance Corporation of India (IFCI). The company has also been accused of issuing over 27 lakh fake share certificates which were used as security to raise funds from banks.
Another group company Mideast Integrated Steel Ltd has been charged with availing itself of the facility of lease financing from Bank of Madura, First Leasing Company of India Ltd, Ashok Leyland Finance Ltd, Onida Finance Ltd and Monnet Finance Ltd by "inducing" them on the basis of fake invoices.
The CBI has been investigating the group since 1997. Investigations were carried in various cities where the group had operations, including Chennai, Bhubaneswar and Mumbai. According to CBI sources, the offences were committed between 1992 and 1997. Income tax authorities had also conducted raids on the group about three years ago.
Copyright © 2000 Indian Express Newspapers (Bombay) Ltd.