New Delhi: In a significant order, the Supreme Court has agreed to drop all criminal proceedings against the fugitive Sandesara brothers in the Sterling Biotech bank fraud case, on condition that they pay a one-time settlement of Rs 5,100 crore to the lender banks by December 17.
This is a third of what they owe to the banks.
The order stipulates that all cases filed by the CBI and ED under the Prevention of Money Laundering Act (PMLA) against Nitin and Chetan Sandesara and other co-accused can be closed once the settlement amount is deposited.
The government has informed the court that a one-time settlement (OTS) has been formally sanctioned in the case that involves an alleged bank fraud of over Rs 5,383 crore.
The Court observed that the primary objective was the recovery of public funds and noted that continuing criminal proceedings would serve little purpose if the defrauded amount is returned.
“Since inception, this court was of the view that if the petitioners are ready to deposit the amount as settled as OTS and public money comes back to lender banks, the continuation of the criminal proceedings would not serve any useful purpose. The tenor of the proceedings apparently indicate peculiarity, with intent to protect the public money and interest and to get deposited the defalcated amount,” the order stated.
The Court, however, made it clear that the relief granted is specific to the unique circumstances of this case and cannot be cited as a precedent in future matters.
The Sandesara brothers, promoters of the Vadodara-based Sterling Biotech and other businesses spanning pharmaceuticals to energy, fled India in 2017 using Albanian passports after being accused of defaulting on domestic bank loans. They denied any wrongdoing.
Investigation revealed that overseas companies of the group secured loans worth thousands of crores from foreign branches of Indian banks. The loans were sanctioned by a consortium of banks led by Andhra Bank, UCO Bank, State Bank of India, Allahabad Bank and Bank of India.
