HC directs Police Commissioner to arrest two former ABF directors

CHENNAI OCT. 28. The Madras High Court has directed the Chennai City Police Commissioner to arrest two former directors of the beleaguered Alwarpet Benefit Fund, and file a compliance report in the court on October 31.

The two persons - K.Sp.V. Shanmugam and his son Harshavaradhan - jointly owe Rs. 50 crores to the ABF, which is still to pay over Rs. 100 crores to its depositors.

Justice S. Ashok Kumar, passing orders on a petition seeking the appointment of a Special Officer for taking control of the assets and property of the ABF and paying depositors their money, also expressed unhappiness over the failure of the police to obey the earlier orders of the court.

The Central Crime Branch police arrested Messrs. Shanmugam and Harshavaradhan on the ground that they had "misused their positions, and indulged in various acts of commission and omissions to siphon off crores of money". However, while granting bail to them in early 2000, Justice P.D. Dinakaran had directed them to pay a sum of Rs. 10 crores by April 30, 2000. Even after their Special Leave Petition to alter the condition was dismissed by the Supreme Court, they did not pay the sum.

Also, inspite of extension of time by various Benches of the court, they paid only Rs. 2.25 crores which was realised after the sale of some of their property. In November 2000, Justice David Christian "condemned the attitude of these two persons, and directed the Chennai City Commissioner of Police to immediately arrest them".

In the present order, Mr. Justice Ashok Kumar noted, "it is unfortunate that the police have not obeyed the order of this court in arresting the accused. Unless coercive steps are taken, these two persons will never part with the money belonging to poor depositors. Hence, the Commissioner of Police is directed to immediately arrest Mr. Shanmugam and Mr. Harshavaradhan and report the compliance of the order by October 31".

The ABF administration has paid only 15 per cent of the depositors' money so far.

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