 "SC asks Samsung chairman to appear in Ghaziabad court")
JCE Consultancy, an Indian company, had in 2002 filed a case that Samsung Electronics and its 72-year-old chairman had failed to make a payment of $1.4 million (about Rs 8.4 crore).
The trial court had sent summons to Lee Kun-hee but later issued a non-bailable warrant in view of his non-appearance. Wednesday’s order came after the Samsung chairman moved the apex court seeking that the criminal case and the warrant against him be quashed.
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A Supreme Court Bench headed by judge C K Prasad clarified the Court had not expressed any opinion on the merit of the case. The petition was withdrawn after the order.
In 2013, the Allahabad High Court had rejected a similar petition from Samsung and declared Lee an absconder and fugitive.
South Korea is among the countries with which India has extradition treaties in operation. This treaty was signed in 2005.
In a statement issued on Wednesday evening, Samsung Electronics clarified that the case related to “a multi-million-dollar fraud scheme perpetrated against a Samsung subsidiary in Dubai” and the private party that had filed the complaint in India claimed “to have received a bill-of-exchange used in this fraud”. A spokesperson for Samsung said: “Chairman Lee has no relation to this case. There are no grounds, let alone evidence, to support the accusation against Lee, who is not involved in the day-to-day operations of the many overseas subsidiaries of Samsung.”
On the likely impact of the order on investor sentiment, a South Korean industry official, asking not to be named, said: “First the Posco incident and now this. South Korea, it seems, might have to rethink its India investment plans.”
Samsung Electronics, with a turnover of over Rs 25,000 crore in India, is the leader in the country’s smartphone and television market. Samsung also sells consumer durables like air-conditioners, refrigerators and personal computers in India.
Controversies are not new to Lee Kun-hee. In 2008, he was found involved in a major corruption scandal in South Korea, where the company was accused of bribing judges, prosecutors and politicians.
Lee Kun-hee had to resign as the company’s chairman as part of the investigation. He was later convicted by a district court, which found him guilty of tax evasion and financial wrongdoings.
However, the President of South Korea later granted official pardon to Lee Kun-hee, who then returned to Samsung as its chairman.
The chairman also fought a legal battle with his elder brother, a sister and a nephew’s wife, who wanted bigger share in Samsung.
In recent times, several chief executives of multinational companies have faced criminal investigations in India. But Lee Kun-hee is perhaps the first global chairman who has been asked to appear before a trial court in India.
In May last year, direct-selling company Amway’s India managing director & CEO William S Pinckney and two other directors were arrested by the crime branch of the Kerala Police in connection with a 2011 case for an alleged violation of the Prize Chits and Money Circulation Schemes (Banning) Act.
In September 2012, Reebok India’s sacked managing director Subhinder Singh Prem and former chief operating officer Vishnu Bhagat were arrested for alleged involvement in a Rs 870-crore fraud and criminal conspiracy at the company.
THE MAN & HIS WAYS
* Lee Kun-hee is chairman of the Samsung group, South Korea’s largest conglomerate with revenue of about 20% of the country’s GDP
* $12 billion: Lee’s estimated net worth
* Controversial past: Lee had resigned as Samsung chairman in 2008 on being found involved in a graft scandal. The company was accused of bribing judges, politicians and prosecutors
* Conviction & pardon: Lee was convicted by a district court, which found him guilty of tax evasion and financial irregularity. But he was later given an official pardon by the President of South Korea
* Family feud, too: Lee also fought a legal battle with his elder brother, a sister and a nephew’s wife, who wanted larger share in Samsung