Singh Brothers Appear In High Court, Restrained From Using Bank Accounts
The Delhi High Court restrained former Ranbaxy Laboratories Ltd. promoters Malvinder and Shivinder Singh from operating their bank accounts in India or abroad and selling any property.
The brothers had appeared in the court in pursuance to its earlier direction regarding repaying the money to Japanese pharma major Daiichi Sankyo, which had come to the high court seeking execution of a Rs 3,500 crore arbitral award. The court asked why the brothers did not declare themselves insolvent when their counsel maintained that they do not have any money.
Justice Rajiv Shakdher, who recorded the depositions of the Singh brothers, also directed them to submit the gift deed of a painting worth Rs 7.59 crore, title document of their Singapore apartment and details of any other bank account. The court also directed their firms RHC Holding Pvt Ltd and Oscar Investments Ltd to disclose bank account details.
While recording their depositions, the court asked them various questions ranging from number of bank accounts in India and abroad, their balances, properties, sculptures and assets. The court restrainted the sale of the Malvinder’s Singapore property which is currently mortgaged to a bank.
The matter has been listed for Sep. 5 for further proceedings.
The court had earlier directed a local commissioner, a chartered accountant, to sell the entire lot of unencumbered shares of the respondents, other than Malvinder in listed companies.
A Singapore tribunal had in April 2016 passed the award in Daiichi’s favour holding that the brothers had concealed information that their company was facing probe by the U.S. Food and Drug Administration and the Department of Justice while selling its shares. The high court on January 31 had upheld the international arbitral award passed in the favour of Daiichi and paved the way for enforcement of the 2016 tribunal award against the brothers who had sold their shares in Ranbaxy to Daiichi in 2008 for Rs 9,576.1 crore. Sun Pharmaceuticals Ltd. had later acquired the company from Daiichi.
The Japanese company had moved the high court in Delhi seeking direction to the brothers to take steps towards paying its Rs 3,500 crore arbitration award and depositing the amount. It had also urged the court to attach their assets, which may be used to recover the award.
The Supreme Court had dismissed Singh brothers’ appeal against the high court verdict upholding the international arbitral award in February 2016.
Singh brothers’ counsel had argued that the award granted consequential damages which were beyond the jurisdiction of the arbitral tribunal and the award cannot be enforced under the provision of the Arbitration Act. They had claimed that Daiichi was fully aware of all facts and still chose to retain the Ranbaxy shares, instead of terminating the agreement and returning them.