New Delhi: Observing the possibility of him not returning to India, given allegations of fraud amounting to nearly Rs 90,000 crore, a Mumbai court has rejected the plea of former Sahara India executive Romie Dutt seeking suspension of a Look Out Circular (LOC) against him, and permission to visit Switzerland.
In a plea moved before the court, Dutt had requested permission to travel to Switzerland between Monday and Friday (31 August and 4 September) for academic and business purposes.
The Serious Fraud Investigation Office (SFIO), which has been probing allegations of misconduct in the corporate affairs of several Sahara Group companies since 2018, objected to the plea, expressing concern that Dutt may flee the probe. Additionally, the agency pointed out that the probe was already constrained with Sushanto Roy and Seemanto—sons of late Subrato Roy and Swapna Roy living abroad and not appearing before investigators in the case.
In October 2018, the Ministry of Corporate Affairs had directed the SFIO to probe allegations of corporate misconduct against nine group companies of the Sahara Group, including Sahara Q Gold Mart Limited and Sahara Q Shop Unique Product Range Ltd. The SFIO told the court that Dutt served as one of the directors and key managerial persons of Sahara Q Shop Unique Product Range between May 2011 and March 2013 and was also among the key operators of Sahara Q Gold Mart Ltd and Aamby Valley, a 10,000-acre hill township.
“Considering all aforesaid grounds, investigation is going on, the possibility cannot be ruled out that applicant may not return back considering allegations of prosecution about commission of the fraud of around Rs 90,000 crore,” Additional Sessions Judge G.G. Bhansali observed in the order while rejecting Dutt’s plea.
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‘Legitimate and well-founded apprehension’
Opposing Dutt’s plea, the SFIO told the court that documents collected during the probe prima facie revealed that he was one of the “key officers and decision-makers in the operations of the Sahara group companies under investigation”, and that he actively participated in the fraud in their corporate affairs.
The SFIO further informed the court that these companies collected funds to the tune of Rs 90,000 crore from approximately 2.91 crore investors in the form of Optionally Fully Convertible Debentures (OFCDs, a majority of whom have not been paid as promised. Instead, their funds were converted by these firms from one company to another group entity without their consent.
ThePrint has sent an email to Dutt, seeking a response on SFIO’s submissions to the court. The report will be updated if and when a response is received.
“It is revealed that such funds have been utilised for purchase of properties across India which have been transferred to related entities within Sahara Group,” the SFIO said in its submission to the court, a copy of which ThePrint has seen.
The SFIO also emphasised why Dutt is personally required to be present in Switzerland and opposed the grounds on which he sought relief, namely, in his capacity as the Executive Director of the Aamby International School Academy Trust, to foster business relations. The agency said that the same objective can be pursued by other officials of the trust as well, and hence Dutt had not made any such plea in the past eight years while the LOC remained open against him.
“That given the applicant’s key role in conducting affairs of the CU/ Sahara Q Shop Unique Product Range Ltd which has illegally collected huge amount of funds from general public and majority of which remains outstanding as on date including siphoning/diversion of the said funds, there is a legitimate and well-founded apprehension that he may evade the process of law if the LOC is suspended,” the SFIO told the court.
“The applicant’s presence is strictly required to be secured before the SFIO as well as before this Ld. Court to ensure the progress of the pending investigation as well as the proceedings which may be initiated before this Ld. Court post completion of the investigation. Consequently, in view of the deliberate breach of fiduciary duties and the scale of the financial fraud, the LOC is not liable to be suspended at this critical stage of the pending investigation.”
Dutt’s counsel in the matter, Niranjan Mundargi, said that the SFIO’s apprehensions were not appropriate. “According to me, these apprehensions expressed were not appropriate. The reason being no person can leave his own children behind and leave country as such and also Switzerland is the country which would not allow a person to permanently settle and live there. He had no visa except for Switzerland. These practicalities ought to have been considered instead of relying on the orders of family members of Subrato Roy,” Mundargi told ThePrint.
(Edited by Nardeep Singh Dahiya)