IN THE SPECIAL COURT (TRIAL OF OFFENCES RELATING TO
TRANSACTIONS IN SECURITIES) AT BOMBAY
SPECIAL CASE N0.2 OF 2004
S. L. Jvianj rekar , Constituted Attorney, Canbank Mutual Fund, Orient House, Adi Marzban Path, Ballard Estate, Bombay. . .. Complainant. vs •
.S hrenl k K. Jhaver i. . . • A ccused. Mr.Pradeep Sancheti i/b. Mis.Desai & Diwanji, for the Compl.:iinant.
MR.Shrenik. K.Jhaveri, Accused in person present.
CORAM: 0 . K. DESBMUKB, J.
DATED: Sth June, 2006. !:.:.£.: -
In view of the Final report submitted by the Investigating Officer, the case is dispcsed cf.
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Fonn5-A
FINAL REPORT FORM
(Under Section 173 Cr. P. C.) IN THE COURT OF: Hon'ble Spl. High Court, Mwnbai.
1. Dist.: Mumbai P.S.: EOW, CB, CID Year: 2005 M.E.C.R No.:15/2005 Date :24/03/l.005
2. Final Report/ Charge Sheet No 3. Date:
4. (I) Act : IPC Section: 406, '409, 420. {II) Act: Section: -
5. Type of Final Form/ Report: ' B' Summary
6. If F.l.R Un occurred: .ialse/Mistake of Fact/ Mistake of Law/ Non- Cognizable/ Civil Nature:- Mistake of fact
7. If Charge sheeted: Original/Supplementary:- Not Applicable
8. Name of the I/O: P.I. S.S.Sapkal.
9. {a) Name of the Complainant/ Informant Sudhir Manjrekar
(b) Father's/ Husband's : Laxman Manjreka r Details of Properties/ Articles/ Documents recovered/ seized during the investigation and relied upon:
Sr. Property Description Estimated P.S. Property From Disposal No. Value (Rs.) Register No. whom/where
Recovered or
Sei7.ed
- - -- -- - ---
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Form5-B lt:'Particulars of accused persons charge-sheeted: (Not Applicable) '•
I. Naine: N.A Whether Verified: N .A
ii. Father's name: N.A
iii. Date/ Year of Birth: N.A
iv. Sex. N.A
v. Nationality: N.A
vi. Passport No. - Date of Issue: -Place of Issue:-
vii. Religion: N .A
viii. Whether SC/ST: ix. Occupation: -N.A
x. Address-N.A xi Provisional Criminal No: N.A xii Regular Criminal No. N.A_ xiii: Date of Arrest: N,A xiv Date of Release on Bail: N.A_ xv Date on which Forwarded to Court - -N.A- xvi Under Acts and Sections: -N.A- Xvii Names of Bailers/ Sureties and Addresses: --N.A- Xviii Previous convictions with detailed references: -N.A- Xix Status of the Accused: N.A
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.....__,, Form 5-C 12.Particulars of accused persons not charge-sheeted:
i. Name: Shreni.k Jhaueri Whether Verified: Yes
ii. Father's / Husband-s name: Kumarpal Jhaveri m. Date/ Year of Birth: 59 Years
iv. Sex: - Male v. Nationality: - Indian
vi. Passport No. Date of Issue -- Place of Issue: ---
vii. Religion: - Hindu viii. Whether SC/S T: -
ix. Occupation: - Share broker Address: -
Saraf House 3rd floor flat no -5 Opp. Sukhsagar Juice Cent.re Girgaon Mumbai- 7
xii. Provisional Criminal No.: - _Nil
xii. Suspicion Approved Yes/No Nil
xiii. Status of the accused (Suspect) Not Arrested Bailed by Police / Bailed by Court /Judicial Custody/ Absconding /Proclaimed/ Not arrested/ Wanted
xiv. Under Acts and Sections: - 406,409,420,of IPC
xv. Any special remarks including reasons for not charge sheeting:-
The investigation does not disclose any cognizable offence, No documentary evidence is found that the equity warrant involved in this case was handed over to Mr. Shrenik Jhaveri.
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form 5-D l3. PARTICULARS O:F WITNESSES TO BE EXAMINED ;r. Nante Father's/ Date/ Ocxupattou Address Typeof Vo. H11Sba1ul's Year of Evidence to be , Name Birtlt tetulered
l e;·udhi r' L axma n 57Years Service 203 Uphar-1 Seven Bung low Complainant Manjrekar Manjrekar Versova Andheri (W) Mumbai 61
) Pa11av Seth SanathSeth 48 Years Share broker. 8 Green field 134, M.K. Road Witness Churchgate Mumbai
i, Bipin Divecha Pushsen 44 Years Service A-11,Embe,e .. Apartm ent, Witness Divecha Saibabana£ar Borivali (W) Mumbai
Sanjay Benere Pandurang 36Years Service 23/4,Laxman Building,. Bhalerao Witness. Benere Ma!g Girgaon Mumbai-4
. Mrudula shah Raju Shah 38 Years Servise 2./31,,Dube,Building,,OJd Witness Nagardas Road Andheri (E)
Mumbai,-69
. Sriram Kha Har Yudhistar 48 yrs Srevice D-899, New friends Colon y, New . Witness Lall Khattar. Delhi-65.EOW, CB, CID, Mumbai
Sidharth Jain Subhashchan- 30 yrs Chartard A-501, Blossam Bldg. Maha veer Witness d Jain Accountant Nagar, Kandivali ( w) Mumbai
• Loyed D'Lima Herold 35 yrs service Lourdes Villa 2"d floor, L.J.Road, Witness D'lima. first lane Mahim, Mumbai-16
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Shrenik Kumarpal 59 yrs Share broker Saraf house 31d floor flat No-5 .Non-applicant Jhaveri Jhaveri Sukhsagar, Girgaon Mumbai
0 P.I .I 46 yr Service EOW, CB, CID, Mumbai Govt. Witness S.S.Sapkal
R.;�rt/ Charg�She-et
Name v .'P .Bhagwat Name S.S. Sapkal
Rank: Sr. Irispedor of Police
Rank: Inspector of Police
EOW, Unit-V, CB, CID,
Mumbai
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14. If F.l.R is fa1se, indicate action taken or proposed to be taken u/ s 182/21 l IPC. No.- False but not Maliciously.
15. Result of Laboratory Analysis:
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Brief Facts of the case (Add Separate Sheet� if necessary):
FormS-E
. On 24/03/2005, Economic Offence Wing Crime Branch, CID, Mumbai, has registered an offence vide MECR NolS/2005 U/s 406, 409, 420, !PC.on the complaint of Mr.Sudhir Laxm.an Manjrekar a constituent Atytorne Can Bank Mutual Fund, Orient House Ali Marjban Path Ballard Pier Mumbai 400 038 against share broker Mr.Shrenik Jhaveri office address 510, Rotunda building Stock Exchange Tower, Dalal Street ,Fort Mumbai, 400 023 , ..
Facts of the case are that Mis ITC Agro Tech Ltd. had issued tradable Equity Wartran to Mis Can Bank Mutual Fund in 1991, bearing Regd.Folio No AWT 2576, Warrant Certificate No 577, Distinctive Nos. 812681-937050 ... Nos. of Warrants held 1,24,3 70. As per the terms and conditions between Mic Can Bank Mutual Fund and share Broker Mr Shreni.k Jhaveri, the said Tractable Equity Warrant had to be bought back by Mr Shrenik Jhaveri a Registered share Broker of Bombay Stock Exchange at the rate of Rs 24/- per warrant. Therefore the said Equity Warrants Certificate along with duly signed transfer deed form handed over to share broker Mr Shrenik Jbaveri by Mis Can Bank Mutual Fund, within the period of one year the non-applicant had to pay the consideration of the said tradable Equity Wartran s, however the share broker Shrenik Jbaveri failed to pay the consideration of the said Equity warrants, he denied to have received the said Equity warrants. Hence the Canbank Mutual Fund, filed a case against ·
Mr Shrenik Jhaveri
Please see separate sheet attached hereto- Annexure 'A'
17. Refer Notice Served: YFS/NO Date:
(Acknowledgement to be placed)
18 Dispatched on:
Forwarded by Station House Officer/ Officer·in-Charge &c��
Signature of �e Investigating Officer submitting the Final Report/ Charge-Sheet. Name V.P .Bhagwat
Rank: Sr. Inspector of Police Name S. S. Sapkal Rank: Inspector ofP olice
EOW, Unit-V, CB, CID,
Mumbai
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@ ANNEXTURE - 'A' Investigation-
I. After registering an offence against share broker Shrenik Thaveri > in order to get the information about the present status of said tradable Equity warrants a summons u/s 160 of Cr.pc was sent to Mis Satguru management and Consultants Pvt.Ltd plot no.15 Hindi Nagar Colony behind Saibaba Temple Punjagutta Hyderabad 500 034 .who is Registrar and Transfer Agents of Mis ITC Agro Tech Ltd. they were also asked to furnish the details about the transferor and transferees of the said Equity wartran s . Mis ITC Agro Tech Ltd is also informed to furnish the details about the present holder of the said Equity warrants and whether the said Equity warrants are converted into Equity shares
2. The Registrar and transfer agent Mis Sathguru Management Consultants informed vide their letter dated 15th April 2005 that the said equity warrant was transferred in the name of Mr Vinod Baid ,the Director of Mis Sifco Growth fund Ltd Kolkata in Sept.1991.
3. Complainant was asked to furnish the copy of terms and condition between Can Bank Mutual Fund and share broker Shrenik Jhaveri in respect of buy back of the said Equity warrants, at the rate of Rs. 24 per Equity warrant however the complainant informed vide their letter, Legal/L-11/124/2005 dt. z9lh March 2005 that they are unable to find out their record any letter containing the terms and condition agreed to with the broker. in respect of equity warrants Also the complainant does not have any acknowledgement receipt regarding banding over the certificate of Equity warrant to share broker
4 . Can Bank Mutual Fund subscribed to 1,35,000. Non Convertible Debentures with tractable equity warrants by paying requisite amount. The stamp of Shrenik Jhaveri on the NCD application coupled with Rs.12, 15,0 00/- paid by the broker as front end fee. 5 . Enquiry made with Ex- Fund Manager Mr Bi pin Divecha and his statement has been recorded. He stated that there was agreement between Can bank Mutual Fund and broker with regard to buy back the said equity warrant, the decision in that respect was taken at top level but he doesn't know whether the decision was in writing or oral. After receipt of equity warrant,. the same was handed over either to the sub- broker Pallav Seth or his representative, As the matter is very old ,he doesn't remember properly, moreover printed covering letter Ref No.2015, dated 20/06/1991,of Can Bank Mutual Fund was shown to him, he identified the remark put by him in his own hand writing that "wrongly received tradable equity warrant certificate from the company handed over on 31st July 1991.
6. Outward/Inward register of Custodian department of Can bank Mutual fund was checked, the entry dated 30/03/1991, in respect of receipt of the said equity warrant certificate was found made in inward register, however there was not entry in outward register in respect of the said equity warrant handed over to Mr Shrenik Jhaveri.or his representative
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·. 7. ··Enquiry made with share broker Shrenik Jhaveri, his statement has been recorded, he stated that the sub broker Mr. Pallav Sanat Seth, was attached to his firm from 1983 to Nov 199 r. he was looking after share business of Mis ITC Agrotech Ltd , Canbank Mutval fund etc, and on the instructions of Can bank he had made number of sales and purchase of share transactions. And therefore he doesn't know anything about tradable equity warrant. he did not accept tradable equity warrant from Canbank Mutual fund, however Rs 12,15,000/- was paid to Canbank Mutual fund, it might be for the purpose of the said equity warrant. There was not any agreement between Can bank Mutual Fund and broker with regard to buy back the said equity warrant.
.8. Enquiry made with sub-broker Mr Pallav Seth, he stated that he was looking after the share transactions of his clients companies such as Mis ITC Agrotech Ltd ,Canbank Mutual fund.etc . .In March 1991. Can Bank Mutual Fund subscribed to Non Convertible Debentures through Shrenik Jhaveri, However there was not any agreement between Can bank Mutual Fund and broker with regard to buy back the said equity warrant. Canbank Mutual Fund did not hand over the said equity warrant to him, As the matter is old, he doesn't recollect about the said equity warrant.
.9 .The Equity Warrant of .Mis ITC Agro Tech Ltd was transferred in the name of Mr. Vinod Baid, director of Mis Sifco Growth fund Ltd ,in order to make an enquiry in the matter on 13/06/2005 Police Inspector Sapkal of EOW, CB,CID, Unit-5 proceeded to Kolkata . He visited the residence place of director of .Mis Sifco Growth fund Ltd , Mr Vinod Baid at 5, Love lock place,. Kolkata -700019, but he was not available at his residence , it was learnt from his wife Mrs Usha Baid that he had been to Delhi for some work and he would be returned after two weeks.
I 0. On 24th June 2005 letter was received from Mr Vinod Said ,in which he stated that he had received the said equity warrant from Mr. Ravi Ramchandran of "Mis I. T. C .Classic Ltd on 16/08/1991 and payment were made to Mis ITC Classic Ltd. Thereafter Mis ITC Agrotech company Secunderabad was requested to furnish the information about transaction of the said equity warrant which were made by Mr. Ravi Ramchandran of ITC Classic Ltd.
11. Mis ITC Agrotech Food Company vide their letter dated 26th July 2005 ,received on 03/08/2005, informed that Mr. Ravi Ramchandran was an employee of Mis JTC Classic Ltd . 37, Virjinia House Chowringhee road, Kolkata. During the course of investigation it was learnt from Can Bank Mutual Fund that Mis ITC Classic Ltd Kolkata is not existed, the said Company was taken over by ICICI Bank,.therfore enquiry made with ICICI Bank,they informed thtt"'a' o not have records of equity warrant of of Mis ITC Agro Tech Ltd .12. On 08/08/2005 and on 14/08/2005 Summons were sent to Mis ITC Ltd Kolkata a sister concern company at 37,Virjinia House Chowringhee road,Kolkata in order to know from whom the said equity warnra ts were purchased and to whom the payment was made, however they informed vide their letter dated I 0th September 2005 and letter dated I i11 October 2005 that they do not have record in respect of transaction of tradable Equity Warrant of Mis ITC Agro Tech Ltd., bearing Regd.Folio No AWT 2576, Warrant Certificate No 577, Distinctive Nos. 812681-937050 Mr. Ravi Ramchandran left the services of the Company with effect from lsa October 1997.The ITC Ltd.,however they
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furnished the permanent address of Mr. Ravi Ramchandran as Ramnagar No-2 PhilJainagar Post- , Tiruchirapalli 620018, Tamilnadu ,. 1'3. On 30.11.2005 Police Inspector S.S.Sapkal proceeded to Tirucirappalli Tamilnadu State and visited the residence place of Mr. Ravi Ramchandra at Ramnagar No-2 , Tillainagar post, Tiruchirapalli however he was not available at his residence therefore ,enquiry made with his father Mr. Raghvan age 74 yis old, he stated that Mr. Ravi Ramchandran i s doing consultancy in I.T.software in Bangalore therefore he was contacted , be stated that in 1991 when he was attached to Mis ITC Ltd at Kolkata, the said equity warrant was received from Mr Shriram Khattar of Mis ITC Ltd Branch office at Tulsiyani Chamber ,Nariman Point Mumbai 400 021.Tbe enquiry made at Tulsiyani Chamber,,Nariman Point Mumbai, it revealed that the said office was closed in 1995 -96
. 14. Enquiry made with head office of Mis ITC Ltd Kolkata in order to find out whereabouts ofMr.Shriram Khattar, who was the Ex.-employee of Mis ITC Ltd Kolkata. Mis ITC Ltd informed the residential address of Mr Sriram khattar as 8-293/174/2/ I, Road No-14, Banjara Hill, Hyderabad 500 034., therefore enquiry made with the said address and it revealed that Mr Sriram Khattar is working with Escort Heart Institute Okhala ,New Delhi . Therefore on 27/01/2006 P.I. SapkaJ proceeded to New Delhi and met Mr. Srirarn Khattar. he was enquired and his statement was recorded ,he stated that in the year 1991-92 he was working with Mis ITC Ltd branch Mumbai at Tulsiyani Chamber Nariman Point Mumbai ,however he did not remember the transaction in respect of equity warrant of Mis ITC AgroT ech Ltd The branch office of Mumbai was closed in the year 1995-96
15. Enquiry made with Dy. Manager Mr Loyed Herold D'Jima of Mis ITC Badrachalan Ltd at Yucaristic congress b1dg No-I, forth floor, Convent stre,et Colaba Mumbai, it revealed that the said branch office of Mis ITC Ltd was situated at Tilsiyani Chamber Nariman Point Mumbai was closed in the year 1995-96
. Enquiry made with Head office of Mis ITC Ltd Kolkata in respect of transaction of equity warrant of Mis ITC AgroT ech Ltd however they informed that they do not have any records i.e contract notes, bills in respect of the said transaction .16. In Nov. 2003, Custodian office of the Hon'ble Spl,Court Mumbai has appointed chartered accountant Mis Jain Chaudhary & Co. office address, 104 Model Residency, BJ.Marg, Jacob Circle Mahalaxmi Mumbai-11, to audit the accounts of Mr. Shrenik Jhaveri for the financial year 1991-92, therefore he was requested to verify the transaction in respect of tradab1e equity warrant of Mis ITC AgroTech Ltd done by Mr Shrenik Jhaveri. Mr Sidharth Jain, Auditor and Chartered Accountant of the said firm verified vallans ,books of accounts and informed vide his letter dated 07/03/2006 that no such transaction regarding tradable equity warrant of Mis ITC Agro Tech Ltd could be traced. The statement of Mr Sidharth Jain Chartered accountant is recorded.
17. Enquiry made with clearing house of Mumbai Stock Exchange that whether the transaction in respect of Tradable Equity Warrant of Mis ITC AgroTech Ltd. was
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� reflected on the floor of BSE in the year 1991, however BSE informed that clearing house has destroyed all the records pertaining to various data up to a period of 1997.
FINDINGS.
1. Can bank Mutual Fund do not have any records or acknowledgement receipt as to the Tradable Equity Warrant Certificate handed over to share broker Mr. Shrenik Jhaveri
2. Custodian department of Can bank Mutual fund made an entry dated 30/03/1991, in Inward register in respect of receipt of the said equity warrant certificate however no entry was found to be made in outward register in respect of the said equity warrant handed over to Mr Shrenik Jhaveri.or his representative
3. Office Order or Agreement or terms and condition in writing between Can Bank Mutual Fund and share broker Shrenik Jhaveri was not found on record in respect of the said Equity warnra ts handed over to share broker Mr. Shrenik Jbaveri,
4 Mr.Vinod Baid of Kolkata had purchased the said Tradable Equity Warrant Certificate from Mr Ravi Ramchandran the Sr. Manager of ITC Classic ltd Kolkata on 16/0811991, Mr. Ravi Ramchandran had received said equity warrant from Mr. Sriram Khattar who was Manager of branch office of ITC Classic ltd Mumbai. Enquiry made with him however he did not remember as to the transaction of the said equity warrant. The records in respect of transaction of equity warrant are not available with Head Office ITC Ltd Kolkata.
S Ex- Fund Manager of Can bank .Mutual Fund Mr. Bipin Divecha stated that he had handed over the said equity warrant to Mr. Pallav Seth Ex-Sub broker of Shrenik Jhaveri however his statement is not supported by docu�entary evidence.
6 Mis Jain & Choudhary, the chartered accountant has audited the books of account of Mr Shrenik Jhaveri,but he did not trace transaction in respect of equity warrant of of Mis ITC AgroTech Ltd
7 . Enquiry made with BSE, however Clearing House of BSE informed that they have destroyed all the records pertaining to various data up to a period of 1997.
8 Enquiry made with Bank oflndia Stock Exchange branch in respect bank statement of Mr. Shrenik Jhaveri but they informed that they have destroyed the records of 1991. f
9 During the course of investigation documentary evidence i.e contract notes, bills, terms and conditions in writing or Client -broker agreement, acknowledgement receipt, or any other document relating to transaction of equity wartran was not produced. So it is difficult to say that the tradable equity warrant was handed over to Mr. Shrenik Jhaveri by Canbank Mutual fund
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·J.O .It appears from the investigation that the complainant has failed to furnish any documentary evidence in support of his statement that the tradable Equity Warrant was actually·handed over to accused person Shrenik Jhaveri for its sale .
. In these circumstances cognizable offence is not disclose-' Inspector of police,
EOW Unit-5,CB,CID,
Mumbai.
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