HYDERABAD: The Andhra Pradesh Government pleaded before the sessions court here on Wednesday to dismiss the revision petition filed by Margadarsi Financiers seeking stay of the search on its premises by the Crime Investigation Department (CID) of the police.
The Government observed that Margadarsi had committed criminal contempt by misleading the court when it pleaded for the stay on the ground that the search was yet to begin. In fact, the search was drawing to a close when it filed its petition last week. Margadarsi Financiers had also misinformed the court when it said it could not serve its notice to the Government about the revision petition for `want of time'.
The notice was faxed to him , the Special Public Prosecutor of the Government, S. Satyanarayana Prasad, argued in the court of the First Additional Metropolitan Sessions Judge, S. Anantasayana Prasad. As the senior counsel for Margadarsi Financiers, C. Padmanabha Reddy, was not present, the judge adjourned further hearing in the case to Tuesday.
The Special Public Prosecutor contended that the revision petition was not maintainable at this stage under Sec. 397 (2) of the Criminal Procedure Code as the search was completed. The court did not have the jurisdiction to go into how the search was conducted.
He said the scope of inquiry by the court was limited to finding out whether the First Additional Chief Metropolitan Magistrate, Y.H. Prameela Reddy, was justified in issuing the search warrant based on the material produced before her. All other questions were irrelevant.
Her order was sustainable as deposits by Margadarsi Financiers were accepted for several years in violation of Sec. 45 (S) of the Reserve Bank of India Act that forbid `unincorporated' bodies to do so. But, the firm not only invited deposits as an Hindu Undivided Family (HUF) but retained them in an escrow account beyond April 2000, the deadline fixed by the RBI for repayment. The Special Public Prosecutor also said the RBI had permitted the Government to take legal action against Margadarsi as it was not among the `non-banking financial companies' that the regulator monitored. It offered the assistance of its officers.