Keeping with an interim order passed by the Supreme Court in connection with the disbursement of funds of Harshad Mehta Group (HMG), the Bombay High Court has directed the custodian of assets of the late stock broker to release Rs. 1995.66 crore to the Income Tax department, to clear their dues.
The I-T department had moved the High Court to claim its dues for the 10-month period when the securities scam perpetrated by the ‘Big Bull’ hit the market in 1991-92.
Justice D. K. Deshmukh, presiding over the Special Court (Trial of Offences relating to Transactions under Securities Act, 1992) on Friday ordered for the amount to be handed over from the funds of HMG, which is presently in the possession of a custodian, appointed by the High Court.
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The family members of Mehta had approached the Supreme Court earlier challenging the custodian’s possession of funds stating that certain properties were held in their name individually and was not part of HMG.
The apex court had on February 21, in an interim order directed the High Court to disburse the dues from the amount with the custodian. The Supreme Court had however observed that if the order is reversed, the money would have to be returned.
The High Court asked for an undertaking of the Finance Secretary promising to return the amount when asked by the court.
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Apart from dues of the I-T department, the High Court has also directed the custodian to pay Rs. 25 crore to CanBank Financial Services and Rs. 200 crore to the State Bank of India. The banks have also been directed to give a similar undertaking.
The Joint Parliamentary Committee, set up for the 1992 scam, had estimated the quantum of the scam at approximately Rs. 4,400 crore.