Almost 24 years after the 1992 securities scam “rocked the economy of the country”, with Harshad Mehta as the kingpin, the Bombay High Court recently convicted six persons, including three bank officials, who were part of the Rs 700-crore scam. On November 25, Justice Shalini Phansalkar-Joshi pronounced the judgment convicting among others Sudhir Mehta, Harshad Mehta’s brother. The case against Harshad Mehta was closed following his death on April 23, 2002. “The country has witnessed the repercussions of the said offence in the sense that the economy of the country was totally shattered on account of this scam,” said the judge.
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The court said it had to do “the balancing act” and in such a situation the principle of proportionality assumed significance. “The sentence has to be proportionate to the offence committed by the accused and at the same time the court has to take into consideration other relevant factors like delay in pronouncement of judgment….,” observed the court.
According to the prosecution, Harshad Mehta, in connivance with officers of National Housing Bank, State Bank of India and various other banks and financial institutions, illegally siphoned off crores of funds “for speculative returns by systemic and deliberate abuse of the system”.
The court convicted National House Bank officials Coodli Ravikumar and S S Babu, SBI officer R Sitaram, Harshad’s cousin Deepak Mehta who was a stock broker and another stock broker Atul Parekh. They have been handed out jail terms upto four years. Convicted only for abetment of criminal breach of trust by a public servant and for criminal conspiracy, Sudhir Mehta was sentenced to six months of imprisonment. The bankers were convicted under various sections including cheating, forgery, criminal breach of trust and criminal conspiracy.
Justice Phansalkar-Joshi dismissed all the convicts’ plea for leniency on health grounds observing that the offence was “grave and very serious in nature”. She, however, allowed them to appeal against the order in the Supreme Court.l