Satyam Computer Services Ltd founder B. Ramalinga Raju, accused of India’s biggest corporate fraud, will be tried in a one-time court within a year to circumvent a legal system with a backlog of 30.8 million cases.
“We are waiting for the notification of the fast-track court and then we are in business”, corporate affairs minister Salman Khursheed said in an interview in New Delhi. “We don’t have to give in to the traditional lethargy we suffer in the legal system. This we will be able to showcase in the Satyam trial as well and that will make quite a difference.”
S. Bharat Kumar, Raju’s lawyer, said he hasn’t been informed about the fast-track hearing.
Under the scanner: A file photo of Satyam founder B. Ramalinga Raju coming out after a hearing at Nampally criminal court in Hyderabad. Bharath Sai / Mint.
“The government will try to show Satyam funds have been diverted and trace any real estate purchases and cash,” Khursheed, 56, said on Thursday. “If wrongdoing is found, the funds can help pay for liabilities arising from a US class-action suit,” he said.
“Raju denies diverting funds and will respond to all charges in court,” Kumar said.
Raju said in January he overstated the software provider’s assets by Rs7,136 crore, triggering a stock slump and government takeover. An expedited trial may help rebuild investor confidence after India slipped to 41st place, behind Mongolia, among the 183 nations ranked for protecting investors in the World Bank’s 2010 Doing Business report.
“If we can demonstrate to the world that we are serious in implementing the laws, that will bring in confidence,” said Ashish K. Bhattacharyya, professor of finance and control at the Indian Institute of Management, Calcutta. “It will help when the recession is over and India will be a desirable destination.”
The one-time court would serve only for the Satyam trial, unlike regular courts where a case has to wait its turn.
“At the moment there is no such necessity,” Kumar, Raju’s lawyer, said in a telephone interview from Hyderabad.
There were 30.8 million cases pending in Indian courts at the end of March, according to the website of the Supreme Court. The top court had 50,163 cases, it said.
More than half the criminal cases pending before the Delhi high court were older than 10 years, it said in the annual report for the year ended 31 March 2008.
The former Satyam chairman was admitted to the Nizam’s Institute of Medical Sciences in Hyderabad on 7 September following a suspected heart attack. “His illness won’t have an impact on the trial,” Khursheed said.
Raju, who faces a maximum penalty of life in prison if convicted, on 7 January said he falsified accounts that went undetected for years. His revelation led to lawsuits from US investors and new disclosure rules by Indian regulators. The Central Bureau of Investigation (CBI) filed eight charges in a Hyderabad court on 7 April against Raju and eight other people.
Raju, 54, has been charged with offences including conspiracy, cheating and forgery, according to the CBI.
“The Institute of Chartered Accountants of India has submitted its report from an inquiry conducted by the statutory agency and the government is studying the recommendations made,” Khursheed said, without providing details.
Tech Mahindra Ltd, partly owned by BT Group Plc and India’s largest maker of sport-utility vehicles Mahindra and Mahindra Ltd, gained control of Hyderabad-based Satyam in May after emerging as the highest bidder following an auction held by a government-nominated board of the firm.