Need Malvinder's custody to confront him with witnesses in RFL scam: ED

The ED told the Delhi High Court Tuesday it required further custodial interrogation of former Fortis Healthcare promoter Malvinder Singh and another co-accused to confront them with voluminous documents and several witnesses in a money laundering case related to alleged misappropriation of funds at Religare Fivest Ltd (RFL).

Justice Chander Shekhar heard part arguments of counsel for the Enforcement Directorate (ED) and the accused and listed the case for further hearing on Wednesday.

The court also asked the counsel for Malvinder and Sunil Godhwani, former CMD of Religare Enterprises Ltd (REL), to file by Wednesday morning their responses to the ED's plea challenging trial court's order refusing to extend their custodial interrogation remand. RFL is a group firm of REL, which was earlier promoted by Malvinder and his brother Shivinder Singh brothers.

The ED said it had secured their 9-day custody in two spells and can avail a maximum period of 15 days to keep the accused in its custody for interrogation.

"Two directors of some companies have been called for interrogation for next four days so that they can be confronted with these two accused (Malvinder and Godhwani). We need their further custodial interrogation. We have time till November 28," central government's standing counsel Amit Mahajan said.

He said there are voluminous documents of past 10 years and enormous amount is involved in the fraud and the probe agency is yet to ascertain the entire proceeds of crime.

The ED plea was opposed by senior advocate Ramesh Gupta and lawyer Manu Sharma, appearing for Malvinder and Godhwani, contending that the agency was seeking their custody not for interrogation but to extort their confessions.

The counsel also alleged that the ED investigation was biased and not fair and the agency was shielding big names, including a 'spiritual baba'.

"They want to humiliate and harass us (accused). They do not want any investigation. They can interrogate us in jail or in court, why they want our police custody. There is a nexus between the investigating agency and the baba," the counsel argued.

The ED, which approached the HC on Monday against the trial court's November 23 order, has sought extension of police custody of Malvinder and Godhwani till November 28.

The trial court had on November 23 dismissed the agency's application for further custodial interrogation of Singh and Godhwani and had sent them to judicial custody till December 7.

The agency had taken both into custody on November 14 from Tihar jail, where they had been lodged in a case filed by the Delhi Police in relation to the alleged scam.

Malvinder and Godhwani have been accused of laundering money, punishable under Sections 3 and 4 of the Prevention of Money Laundering Act.

Earlier, they were in judicial custody along with Malvinder's brother Shivinder and two others -- Kavi Arora and Anil Saxena -- in a case filed by the Economic Offences Wing (EOW) of Delhi Police.

The ED alleged that both the brothers, along with others, transferred an amount of about Rs 1,000 crore to various persons from entities linked to the corporate loan book and finally, the money was siphoned off.

The agency started its investigation in the matter on the basis of a case lodged by the Delhi Police.

Malvinder (46), Shivinder (44), Godhwani (58), Arora (48) and Saxena were arrested by EOW for allegedly diverting the money and investing in other companies.

The EOW registered an FIR in March after it received a complaint from RFL's Manpreet Suri against Shivinder, Godhwani and others, alleging that loans were taken by them while managing the firm but the money was invested in other companies.

"They put RFL in a poor financial condition by disbursing loans to companies with no financial standing and controlled by them. The companies to which the loans were disbursed willfully defaulted in repayments and caused a loss to RFL to the tune of Rs 2,397 crore," the police had alleged.