Harshad Mehta's property to be assessed

The Supreme Court has asked a special court in Mumbai to assess the liabilities and assets of stockbroker Harshad Mehta, who was involved in the securities scam that rocked the country in the early nineties.

The Special Court in Mumbai, which was set up to try matters relating to the securities scam, has been asked to decide afresh pleas against auctioning property worth over Rs 100 crore (Rs 1 billion) belonging to Mehta.

The Special Court ordered auctioning eight out of nine flats belonging to Mehta in the massive housing complex "Madhuli" on the Annie Besant Road.

A Bench headed by Justice S B Sinha (who retired last Saturday) said: "The impugned judgment is set aside and the matter is remanded to the learned Judge, Special Court, for consideration...in the light of the observations of this Court...preferably within a period of six months from the date of this judgment. The appeal is allowed..."

Arvind Kumar Tewari, the counsel for the custodian, said that the landmark judgement "had strengthened the arms of a special court to recover crores of public money siphoned (off) by the Harshad Mehta group and various other notified parties involved in the scam".

Harshad Mehta, who died of a heart attack in Mumbai in December 2001, faced allegations of diverting huge amounts of public money to the securities market.

Jyoti Harshad Mehta, the late stockbroker's wife, and other family members had challenged the special court's orders directing attaching Mehta's property on the grounds that it was constructed using the money accumulated during the stock market scam.

Tewari further said that the verdict would not affect the auction of eight flats belonging to the Mehtas in the massive housing complex "Madhuli" on the Annie Besant Road, which were ordered to be auctioned by the Special Court in Mumbai.

"By a separate order on July 27, this year, Justice Sinha ordered that the sale of these eight flats owned by the the Harshad Mehta's family shall be confirmed by the special court," Tewari said.

The apex court has asked the special court to consider the two audit reports filed by charterd accountants Vyas and Vyas and Vinod K Agarwala and Co.

According to the apex court, a lot of documents had been filed with regard to audited reports by the chartered accountants, but "it does not appear that the special judge had considered this aspect of the matter in great detail."