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Journalism of Courage
NEW DELHI, June 23: While extending the freeze on the bank accounts of the CRB Capital Markets Ltd CRBCML and its 39 associate companies, alleged to be involved in the Rs 1,200 crore CRB scam, the Delhi High Court today ordered the de-freezing of the accounts of Daewoo Finance India Ltd on certain conditions.
The single-judge vacation bench of Justice S N Kapoor also ordered that the two CRB directors on the Daewoo Finance board 8211; C R Bhansali and his wife Manjula Bhansali 8211; should be substituted by A C Tiwari IAAS, retired Deputy Auditor General of India and Meera Saxena ICAS, retired Controller General of Accounts.
The two former bureaucrats were named representatives by official liquidator Shri Ram to the board of directors of Daewoo Finance 8211; which has a tie-up with CRB 8211; after a suggestion to this regard was made by Daewoo counsels K T Tulsi and Shashi Prabhu.
The judge extended the freeze on the bank accounts of the other 39 companies till further orders on the grounds that no objections were raised from any of these CRB-associate firms.
Kapoor said that since Tulsi had offered the nomination of two representatives of the OL to the board, the court was nominating Tiwari and Saxena as the directors. 8220;In ordinary course, one might have felt inhibited to do so, but in view of the concession, the enormity of the problem, the stake of the CRBCML in Daewoo to the extent of 24 per cent shares amounting to Rs 2.60 crore, I feel that in place of C R Bhansali and Manju Bansali, these two directors should be substituted to represent the liquidator,8221; he said.
CRB Caps had invested Rs 11.12 crore to have 50 per cent equity in Daewoo Finance. But, on September 19, 1996, the Korean company had increased its stake to 75 per cent by buying 26 per cent shares of CRB Capital Markets Limited. The accounts of Daewoo was frozen along with other CRB associate firms two weeks ago.
The court also asked the Korean company, which figures in the Fortune 500, to pay Rs 2.60 crore, invested by CRB Capital Markets in Daewoo, to the liquidators within three months. The court laid down five conditions for the lifting of the freeze on Daewoo of Korea:
Neither any payment excepting petty and routine expenditure should be made by the company, nor any liability by raising loan from any person should be incurred without the prior approval of the board of directors,
The company should not dispose off its immovable properties and should not take or transfer any amount outside the country without permission of the court.
The company should hold an urgent meeting of either the shareholders or the board, as the case may be deemed necessary and desirable, to pass necessary resolutions to give effect to this order and in respect of the appointment of the two former bureaucrats as directors.
The company should also file security of immovable properties to the extent of Rs five crore and an undertaking that they will not dispose off immovable properties of the company or otherwise part with possession without prior approval of the court.
The board of company should also ensure that a reserve sum of Rs 2.60 crore is created during the next three months to ensure payment of this money to the official liquidator OL.
In the meantime, SEBI has prohibited CRB Share custodian from undertaking any activity as a debenture trustee until further orders. This action, effective from May 28, 1997, has been taken by the SEBI chairman under section 11B of the SEBI Act, to prevent its functioning as debenture trustee.
