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Ranbaxy-Daiichi case: SC invokes ‘country’s honour’, asks Malvinder, Shivinder how will they pay Rs 3,500 crore to Daiichi

Indu Bhan
ranbaxy, fortis

Coming down heavily on the Singh brothers Malvinder and Shivinder the Supreme Court on Thursday asked them to apprise it how they propose to comply with the Rs 3,500-crore arbitral award passed against them by a Singapore tribunal in favour of Japanese drug major Daiichi Sankyo.

A bench headed by Chief Justice Ranjan Gogoi asked the brothers, who were present in the court as per its earlier the direction, to consult their financial and legal advisors and give a concrete plan on how they will comply with the tribunal s order. The apex court asked the brothers to appear before it on March 28 and submit the plan, saying hopefully, it will be the last time you are appearing in the court .

It doesn t look good for the country s honour. You were the flag bearers of the pharmacare industry and it doesn t look good that you are appearing in the court. Both the brothers for this purpose unite. It is not the question of Rs 4,000 to Rs 5,000 crore. It is the question of honour. You have to pay. So reflect, look into your accounts, finances, turn to your legal advisors. We believe this was your first time in the court. Let your next appearance be your last, Chief Justice Ranjan Gogoi, who was heading the bench, said.

As soon as the brothers were asked to come in front, the CJI said that the court would interact directly with them and take help from their counsel only if required.

The Chief Justice asked them: Tell us, are you not obliged in law to secure the final award. With so many ups and downs in the companies and individuals, the court would like the award to be secured. We would like to know how do you propose to secure it in the event orders are passed to the effect that you have to sell the properties, how will you shell out the money?

As Malvinder replied, I am trying my best, the CJI retorted, If you aren t ready to answer, reflect. Whatever you say will be recorded, and will go against you. We will fix the day of your answer as per your convenience.

Turning to Shivinder, the younger brother who in his affidavit stated that he has renounced the world and taken sanyas , the CJI said, You are telling us that you have nothing to do with the companies anymore and that your elder brother is running the show. If you are renouncing the world, it may be good for you, not good for us. You can t renounce the world when there is a decree against you.
At this, Shivinder s senior counsel PS Patwalia submitted, Shivinder has come back to the world in December 2017.

Also read: Malvinder, Shivinder Singh battling host of fund syphoning charges

That s good. Now that you have come back to world, tell us how would you honour the commitment, start thinking about money, the CJI told the younger brother.

Daiichi Sankyo is pursuing the enforcement of the Rs 3,500-crore arbitration award against the Singh brothers pronounced by a Singapore tribunal for concealing information regarding wrongdoings at Ranbaxy Laboratories while selling it to it for $4.6 billion in 2008.

The apex court had on February 26 asked the Fortis Healthcare s former promoters Malvinder and Shivinder Singh to be personally present before it on March 14 to explain the status of Rs 4,000 crore the hospital chain had received from Malaysia s IHH Healthcare Berhad.

The court had asked them to explain the position with regard to funds that allegedly have been diverted by Fortis Healthcare to re-purchase the assets of RHT Health Trust, Singapore, in which the Singh brothers and other judgment debtors had substantial interest till 2017. However, the issue was not taken up during Thursday s hearing.

The apex court had on December 14 put on hold the sale of controlling stake (31%) in Fortis Healthcare to the Malaysian firm on a contempt plea filed by Daiichi against the Singh brothers. The order for maintaining status quo till further orders of the apex court meant that IHH Healthcare, which had in July won the bidding war for Fortis Healthcare with its Rs 4,000-crore offer, could not go ahead with its open offer, which was to commence from December 18, 2018.

Fortis Healthcare, on its part has denied any violation of the Supreme Court s December 14 order saying the same did not arise as the status quo was ordered only with regard to the transaction between Fortis Healthcare and IHH .