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Kampani gets relief from Andhra court

Kampani gets relief from Andhra court
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First Published: Thu, Oct 15 2009. 01 05 AM IST

Reprieve: Nimesh Kampani. Scott Eells / Bloomberg
Reprieve: Nimesh Kampani. Scott Eells / Bloomberg
Updated: Thu, Oct 15 2009. 01 05 AM IST
Hyderabad: Providing a respite to Nimesh Kampani, chairman of JM Financial Ltd, the Andhra Pradesh high court on Wednesday stayed further proceedings against him in connection with defaults to depositors of Hyderabad-based Nagarjuna Finance Ltd.
Reprieve: Nimesh Kampani. Scott Eells / Bloomberg
Kampani has been seeking to avoid arrest in the last nine months in the case filed against him by the Andhra Pradesh police on charges that Nagarjuna Finance, whose board Kampani was on, had failed to return some Rs100 crore to depositors. Following this, Interpol had issued lookout notices for Kampani.
While the court had on 20 August dismissed a petition filed by Kampani seeking to quash all proceedings against him and seeking anticipatory bail, judge K.C. Bhanu on Wednesday issued interim stay orders on the earlier dismissal.
The stay on proceedings against him through interim orders, which provides major relief to Kampani, however, does not amount to the quashing of all the proceedings against him or providing anticipatory bail.
The judge stayed proceedings against Kampani by the petitioners and depositors of Nagarjuna Finance, who were paid their dues, prompting them to withdraw their police compliant against him. Further, the public prosecutor has also informed the court that the investigations into the case had already been already completed and that there was no need for interrogating Kampani in connection with this matter.
Informing the court that he had resigned from Nagarjuna Finance in 1999, much before the company defaulted to the depositors, Kampani, in his petition in August, asked the court to quash criminal proceedings against him as well as a lookout notice issued by the Andhra Pradesh police. Kampani, who is reportedly in Dubai, had agreed to pay Rs1 crore as surety, surrender his passport and cooperate with the investigation agencies.
The central crime station police in Hyderabad had registered a case against the promoter directors of the finance company, accusing them of defrauding depositors of some Rs100 crore. After arresting the founder promoter and chairman of Nagarjuna Group, K.S. Raju, and chief executive officer of Maytas Infra Ltd, P.K. Madhav, on 16 December, the city police had issued a lookout notice for Kampani and distributed it to several airports across the world.
Raju was the promoter of Nagarjuna Finance and Madhav was on its board when the firm raised the public deposits. Raju divested his holding in the non-banking financial company to Mumbai-based Mahalakshmi Factoring Services Ltd in September 2000.
Shares of JM Financial rose 10%, the maximum the share can gain in a single day on Monday on the Bombay Stock Exchange, and ended at Rs47.85. Stocks traded in the derivative segment do not have a daily limit for gains or losses but others have a limit of 5%, 10% and 20%. The bourses decide from time to time the price band within which individual stocks can be traded, depending on their volatility, volume of trading and other factors.
c.sukumar@livemint.com
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First Published: Thu, Oct 15 2009. 01 05 AM IST