Ranbaxy Ex-Promoters Malvinder, Shivinder Singh arrested in fraud case
New Delhi : Pharmaceutical giant Ranbaxy's ex-promoters Shivinder Singh and his elder brother Malvinder Singh have been arrested by the Enforcement Directorate on Thursday for their alleged connection in a Rs. 740-crore fraud case.
The duo brothers were under accusation of fraud and misappropriation involving around Rs. 740 crore by Religare Finvest.
In December, Religare Finvest filed a complaint against them; five months later they were charged with cheating, fraud and misappropriation of funds.
Ranbaxy Laboratories, founded by their father, was sold to a Japanese firm Daiichi Sankyo in 2008. Since then, the two brothers were focusing on the family-owned Fortis Healthcare, a hospital chain, and Religare Enterprises, a financial services firm.
In 2013, Daiichi moved an arbitration tribunal in Singapore alleging that the brothers, while selling Ranbaxy, had concealed information about the US Food and Drug Administration and the Department of Justice investigating the company. The tribunal in 2016 ordered the Singhs to pay Daiichi Rs. 2,562 crore. The brothers challenged the decision but in 2017, the Delhi High Court ordered them to pay up.
The brothers' feud began after they lost control of both Fortis Healthcare and Religare.
In February 2018, they resigned from their posts of directors in the Fortis Healthcare. In September 2018, Shivinder Singh filed a case against Malvinder alleging "oppression and mismanagement" in their joint businesses - RHC Holding, Religare and Fortis.
The Securities And Exchange Board of India (SEBI) ordered the Singhs and firms related to them to pay Rs. 403 crore to Fortis, after it emerged during investigations that they had diverted funds from Fortis and misrepresented financial statements.
Last year, the Supreme Court also dismissed the Singh brothers' appeal and confirmed the international arbitral award, saying it was not inclined to interfere with it.
Earlier this year, the brothers were told by the top court that they could go to jail for disobeying its orders to pay what was due to Daiichi Sankyo.