Court adjourns hearing on SEBI plea on Satyam fraud

January 29th, 2009 - 8:01 pm ICT by IANS  

Ramalinga RajuHyderabad, Jan 29 (IANS) The Andhra Pradesh High Court Thursday adjourned to Friday hearing on a petition by the market regulator Securities and Exchange Board of India (SEBI) seeking permission to record statements of disgraced Satyam Computer founder B. Ramalinga Raju and his brother B. Rama Raju in the Rs.70 billion fraud. Justice Seshasayana Reddy heard brief arguments from Solicitor General of India G. Vahanvati and later adjourned the case.

The law officer argued that SEBI was the authorised agency to investigate the case and record statements of the accused as the interests of tens of thousands of investors were involved.

SEBI has challenged the order of sixth additional chief metropolitan magistrate, who dismissed its similar petition last week.

SEBI, which moved the high court Wednesday, said it wanted to record statements of the Raju brothers for alleged violations of security laws, including fraudulent and manipulative practices.

It has made the state’s home department, the Crime Investigation Department (CID) and the Chanchalguda Central Jail Superintendent as respondents.

The SEBI petition said there were several allegations including a strong likelihood of insider trading prior to Jan 7, when Ramalinga Raju confessed to the massive fraud.

While SEBI summoned Ramalinga Raju Jan 9, he sought a day’s time leading to the adjournment of the proceedings till Jan 10.

“As a strange coincidence they were arrested (by CID) on Jan 9 night,” SEBI said adding that they were remanded to judicial custody that was being extended from time to time.

As the accused were in judicial custody and beyond its reach, SEBI has sought permission to record their statements.

The Raju brothers and former chief financial officer Vadlamani Srinivas, who was arrested Jan 10, are lodged in Chanchalguda Central Jail here, as they are in judicial custody till Jan 31.

Meanwhile, the sixth additional chief metropolitan magistrate D. Ramakrishna has reserved orders on the bail petitions of S. Gopalakrishnan and Srinivas Talluri, the former partners of PricewaterhouseCoopers, the firm that audited the accounts of Satyam. The orders will be pronounced on Feb 2.

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