By Neeraj Mahajan and Navtej Singh
In order to wriggle out of the financial mess – he created for himself and had to forgo the Directorship in over a dozen companies in India and overseas Jignesh Shah has changed his strategy. Instead of media management; PR and image building exercises the fallen hero is now banking on exploiting the legal system to save himself.
Ironically the money being spent by him to engage the battery of top most lawyers in the country belongs to the very investors against whom he is defending himself.
The question that now arises is whether Justice V.M. Kanade should step aside or reportedly prolong the merger between NSEL and FTIL till February 4 and in effect provide much needed relief to Jignesh Shah?
Justice was not only delayed but denied when instead of recusing himself Justice V.M. Kanade of the Mumbai High Court initiated contempt proceeding against investors in the Rs.5,574.34 crore fraud case in which his son Vishal Kanade represents one of the accused.
The investors who last their life’s sayings in the NSEL Scam had sent a letter to Justice V.M. Kanade, alleging that since his son had appeared for NSEL defaulters ‘there is an obvious likelihood of a bias’ K Investors in the beleaguered commodity bourse have asked Justice V.M. Kanade of the Bombay high court to recuse himself from hearing all matters related to the Rs.5,574.34 crore fraud at NSEL.
The NSEL Investors Forum letter to Kanade was point blank, “We have come to know that your son Mr Vishal Kanade has appeared for NSEL defaulter M/s P.D Agro Processors Pvt Ltd. director’s case for suit no SC/328 and MS 765/20114”. A copy of this letter was also sent to Justice Mohit Shah, chief justice of the Bombay high court.
“This Company and its directors have cheated investors by around
Rs 700 crores and they are also accused in the FIR filed with the EOW Mumbai police as well as in various suits in Mumbai High Court. There is an obvious likelihood of a bias in your mind against the NSEL investors due to the involvement of your son. Hence in the interest of fairness and propriety we request you to kindly recuse yourself from all matters related to NSEL including FTIL/union of India.” the letter added.
In a separate case on 27 November (Writ petition no 2743 of 2014), a division bench comprising Justice V.M. Kanade and Justice Anuja Prabhudesai had directed the Union government to maintain status quo on the draft order till 22 December. This went against the interest of the investors. The merger would meant FTIL which ownes owns 99.99% stake in NSEL was going to be liable for all the dealings of the commodity bourse and party to all the contracts and agreements entered into by NSEL.
Earlier on 30 October, Kanade had recused himself from hearing a petition challenging an FMC order declaring FTIL un-fit to run exchanges as senior counsel Ravi Kadam was representing FTIL.
Justice Kanade’s son Vishal is Kadam’s junior.
Significantly PD Agro is the third largest borrower of NSEL and traded on the Exchange on behalf of Dunar Foods Ltd., Dulisons Cereals and Dulisons Foods. The company defaulted to the tune of Rs.605 crores in NSEL and so far only managed to pay Rs 7.06 crore.
Surendra Gupta, MD of P D Agroprocessors was arrested by the economic offences wing (EOW) of the Mumbai police on 5 March 2014. The Enforcement Directorate also attached properties belonging to P D Agro worth over Rs. 50 crore in Karnal and Mumbai under the Prevention of Money Laundering Act (PMLA).
Investigations revealed that P D Agro is a sister concern of Dunar Foods Ltd. which has rice manufacturing plants at Karnal and Amritsar and is a major branded Basmati rice exporter. P D Agro reportedly diverted NSEL investor funds to the tune of Rs.300 crores to Dunar Foods in the pretext of purchasing paddy and servicing loans. The ED investigations revealed that more than Rs.30 crores were siphoned off to purchase a real estate project – Prime City developed by Prime Zone Developers Pvt Ltd at Assand, District – Karnal. Gupta was also reportedly working closely with AB Waves Constructions.
According to investigations carried out by Taazakhabar News Dunar Foods Limited Corporate Identification Number (CIN) is U01111MH1997PLC208346 and Registeration Number is 208346 is registered on 23 September, 1997. Its registered address on file is “meadows”, 811 sahar Plaza, Andheri Kurla, Mumbai – 400059, Maharashtra, India.
Dunar Foods Limited has 6 active directors / partners: Gopal Srinivasan, Surender Gupta, Kanta Gupta, Kirti Dua, Sankaran Balasubramanian, Charul Kapoor. There are no other Active Directors / Partners in the company except these 6 officials.
Born on 22nd June 1955 Justice V. M. Kanade started his practice in civil, criminal and constitutional cases in the Bombay High Court in 1979. After working as a panel Counsel for State of Maharashtra and part time lecturer in New Law College, Mumbai, he was elevated as High Court Judge in October, 2001 and appointed as a Judge of the Special Court (Trial of Offences Relating to Transaction in Securities) Act, 1992 in 2006.
According to highly placed sources his son Vishal Kanade appeared as a counsel in suit no 173 of 2014 in the court of Justice Gupte. Vishal Kanade’s name appears (Page 4/19).
Apart from this Vishal Kanade appeared in Suit no SL/328 for defendant number 15 i.e Shankaran Balasubramanium, Director of Dunar Foods having his residence at Marfai, Hong Kong.