Bhushan Steel case: SFIO opposes ex-CFO’s bail plea

The Serious Fraud Investigation Office (SFIO), a statutory corporate fraud investigating agency, also said that the “economic offences constitute a class apart and need to be visited with a different approach in the matter of bail”.

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The agency was responding to Johri’s plea for three weeks interim bail on account of his mother “terminal illness”.

The SFIO Tuesday opposed in the Delhi High Court the interim bail plea of former chief financial officer of Bhushan Steel, Nittin Johri, saying he is one of the “prime perpetrators and master mind” of the entire fraudulent arrangement of manipulations through the Letter of Credit (LCs) by filing false documents with various banks.

The Serious Fraud Investigation Office (SFIO), a statutory corporate fraud investigating agency, also said that the “economic offences constitute a class apart and need to be visited with a different approach in the matter of bail”. The agency was responding to Johri’s plea for three weeks interim bail on account of his mother “terminal illness”.

Justice Mukta Gupta had SFIO to verify the medical records of Johri’s mother and file their status report. She, however, recused herself from hearing the matter, citing personal reason.

However, the SFIO, in status report filed through advocates Harsh Ahuja and Kushal Kumar, stated that “the economic offence having deep rooted conspiracies and involving huge loss of public funds, needs to be viewed seriously and considered as grave offences affecting the economy of the country as a whole and thereby posing serious threat to the financial health of the country.

Additional Solicitor General Maninder Acharya, central government standing counsel Monika Arora and Anurag Ahluwalia, submitted before the court that, since the time of start of investigation, Johri has appeared before the Inspectors several times, but, he has not been forthcoming and has been evasive on most of the issues and has repeatedly misleaded the investigation.

On the medical condition of his mother (79), the SFIO said in their status report that “…she is admitted with complaints of breathlessness. She is terminally ill patient and presently admitted for palliative care management” at Super Speciality Hospital in Saket.

The report said that Johri, who is judicial custody since May 8, as the “ex-CFO and whole time director and a member of the committee of board of directors on borrowing, investment and loans, is one of the prime perpetrators and the master mind of the entire fraudulent arrangement of manipulations through LCs by filing false documents with various banks”.

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It said that Johri “in connivance with Neeraj Singal and Brij Bhushan Singal (former promoters of Bhushan Steel), availed credit facilities for BSL from various banks, using the instrument of Lcs, on the basis of manipulated and false documents”. “A large number of LCs, amounting to more than Rs 20,000 crores were opened on behalf of BSL over a period of time starting from F.Y 2014-15, purportedly showing Hindustan Zinc Ltd and JSW Steel Ltd as beneficiaries of LCs.

“Investigation, however, revealed that the said LCs were discounted/ invoked by BSL itself by using false documents/bills, thereof which, the proceeds/ money, which should have been credited into the account of beneficiaries, were actually credited in the bank accounts of BSL itself,” the SFIO said in their staus report.