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Ex-promoter of Fortis Healthcare failed to exonerate himself from contempt: Court fails to exonerate fortis healthcare’s ex-promoter from contempt

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Ex-promoter of Fortis Healthcare failed to exonerate himself from contempt: Court fails to exonerate fortis healthcare’s ex-promoter from contempt

New Delhi, Sep 23 (PTI) The Supreme Court has said Malvinder Singh and Shivinder Singh, former promoters of Fortis Healthcare Ltd, have “failed to absolve themselves of contempt”. The Court observed that the two did not make a genuine effort to pay Rs 1170.95 crore (separately for each) under the judgment of an arbitration court. He was also sentenced to six months in jail.

The contempt action was initiated by the Japanese firm Daiichi Sankyo Co., Ltd. In this, under the order of an arbitration court in Singapore, it was sought to pay Rs 3,600 crore in its favor. This recovery was to be made from 20 respondents including Malvinder Mohan Singh and Shivinder Singh.

Daiichi also challenged the Fortis-IHH share deal for recovery of the arbitration order of Rs 3,600 crore. Subsequently, the former promoters of Fortis Healthcare Ltd had to face a court battle.

The Fortis-IHH deal is stalled due to a legal battle between Daiichi and former Fortis Healthcare promoters.

It was also alleged that apart from committing contempt, the Singh brothers devised a well-planned scheme to reduce the stake of companies controlled by them so that the arbitration order could not be implemented.

In its order on Thursday, a bench of Chief Justice Uday Umesh Lalit, Justice Indira Banerjee and Justice KM Joseph said, “As far as the role played by the Singh brothers is concerned, the matter is within a limited scope, i.e., did they themselves Freed from contempt or not? The property offered by the said contemptuous person in his affidavit is so small that it is impossible to meet the amount paid in favor of Daiichi under the order of the foreign arbitrator.

The court further said, “Therefore, we are left with no option but to hold that the contempt karts Nos. 9 and 10 have failed to exonerate themselves from the contempt. In fact, no real effort has been made on their part. Then the question comes about the quantum of punishment. In view of their acts, in our view maximum punishment should be given.”

The bench sentenced him to six months’ imprisonment and a fine of Rs 5,000 for contempt of court. In case of non-payment of fine amount, the punishment will be increased by two months.

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