Business

Satyam case: Court defers judgement to April 9

The special court set up to try the multi-crore accounting fraud at erstwhile Satyam Computer Services Limited, on Monday deferred the judgement to April 9. The verdict was earlier slated to be delivered today.

Trial in the case, touted as the biggest accounting fraud in India, began on November 8, 2010 and was completed on June 24, 2014. 

During the course of the trial, the special court examined 216 witnesses and marked 3,038 documents. All the 10 accused, including former Satyam chairman Ramalinga Raju attended the court proceedings on Monday.

Other accused in the case are his brother and the company’s former managing director, B Rama Raju; former chief financial officer Vadlamani Srinivas; former Price Waterhouse auditors S Gopalakrishnan and Srinivas Talluri; B Suryanarayana Raju; former employees G Ramakrishna, D Venkatpathi Raju and Ch Srisailam; and Satyam’s former internal chief auditor VS Prabhakar Gupta.

The scam came to light on January 7, 2009, after Ramalinga Raju confessed to manipulating the company’s account books and inflating profits to the tune of several crores.

On December 16, 2008, Satyam had announced its board’s approval for acquiring 100% stake in Maytas Properties for $ 1.3 billion, as well as 51% in Maytas Infra for $ 300 million – the companies were promoted by Raju and his sons.

The Satyam management, however, called off the deal on December 17, 2008, after investors expressed outrage at the decision. In a letter, Raju had said, “The aborted Maytas deal was actually a last attempt to fill the fictitious assets with real ones.”

Raju was arrested on January 7, 2009. In February that year, the Central Bureau of Investigation (CBI) took charge of the probe and filed three charge sheets (on April 7, 2009, November 24, 2009 and January 7, 2010). Later, the charge sheets were clubbed into one.

In its chargesheet, CBI had termed the Satyam case as India’s biggest corporate fraud case. Loss to the invetsors was to the tune of Rs 14,162 crore, It had said that the company’s former chairman Ramalinga Raju and members of his family secured illegal gains to the tune of about Rs 2,743 crore by various tricks.

“The fraud was perpetrated by inflating the revenue of the company through false sales invoices and showing corresponding gains by forging the bank statements with the connivance of the statutory and internal auditors of the company. The annual financial statements of the company with inflated revenue were published for several years and this lead to higher price of the scrip in the market. In the process, innocent investors were lured to invest in the company. Attempts were made to conceal the fraud by acquiring the companies of kith and kin,” CBI had said.

Raju, along with others, were charged with offences under various sections of the Indian Penal Code (IPC), including 120B (criminal conspiracy), 409 (criminal breach of trust), 420 (cheating), 467 (forgery of valuable security, will), 468 (forgery for cheating), 471(using forged documents as genuine) and 477-A (falsification of accounts).

Currently, all the accused are out on bail. Raju, the prime accused, B Rama Raju and Srinivas Vadlamani were released on bail on October 18, 2012.