Court reserves orders on SEBI petition to meet Raju brothers

Securities and Exchange Board of India (SEBI) officials will have to wait till January 19 to know whether they can record the statement of the former Satyam Chairman B. Ramalinga Raju and his brother B. Rama Raju, both of whom are in jail since January 10. A court here on Friday posted for Monday orders on SEBI’s petition for recording the statements of the Raju brothers as also hearing on the bail application of the Raju brothers and former Chief Financial Officer Srinivas Vadlamani. It will pronounce its judgment on Saturday on an application by the police seeking custody of the three accused in the multi-crore Satyam scam. The SEBI plea was stiffly opposed by Mr. Ramalinga Raju’s advocate S.R. Ashok on the ground that “it is a knee jerk reaction in a sensitive issue.” SEBI counsel T. Bal Reddy said Mr. Raju had offered to subject himself to the laws of the land and nothing should prevent him now from giving a statement. The Sixth Additional Chief Metropolitan Magistrate D. Ramakrishna, who heard the case, reserved orders after Additional Public Prosecutor K. Ajay Kumar and counsels for the three accused presented their arguments in a packed court hall here on Friday. The Raju brothers engaged a battery of top lawyers, including a former advocate general, during the day-long arguments that had a touch of drama as the team made a pitched attempt to defend the ex-Satyam boss. Disputing the SEBI argument that it wanted access to the Rajus for one day to inquire into the dealing in shares by Satyam Computer Services Limited , Mr. Ashok said the stock market regulator could get the information it required from the share transfer agency. The SEBI, he remarked, wanted to demonstrate to the country that it was also a player in the fire fighting exercise. The prosecution, arguing for seven-day police custody of the Satyam trio, said the connivance of some other company directors, financial institutions and bankers could not be exposed unless they were interrogated. Mr. Ajay Kumar said the benami transactions in 250 companies to which the funds of Satyam were diverted had to be dug out. The company held000 of bank accounts in various parts of the world and it was a legal necessity to trace them out. Besides, the former CFO played a crucial role in the company’s accounting, particularly in the opening of bank accounts and purchase of properties. Mr. Vadlamani disposed of 92,000 shares and used the proceeds to acquire assets, he said. Senior lawyers D. Prakash Reddy and C. Padmanabha Reddy who appeared for the Raju brothers said there was no prima facie evidence to justify police custody which was meant for recovering something. But, three agencies involved in the investigations had seized almost all the records during their numerous searches at Satyam’s offices and the residences of their directors. The Crime Investigation Department had recovered 44 documents even after making an application for police custody n January 10.