Dalal, Mohan get 7-year jail term in
multi-crore securities scam

MUMBAI, Aug 27 (PTI) — In the first major conviction in the multi-crore securities scam case, stock broker Hiten Dalal and former Canara Bank Financial Services (Canfina) Assistant Vice-President S. Mohan were today sentenced to seven years rigorous imprisonment (RI) by a special court here.

The court of Justice S.N. Variava also imposed a fine of Rs 1 lakh each on the two for defrauding Canara Bank subsidiary Canfina by siphoning off Rs 33 crore in 1992.

The special court held Dalal guilty of offences under Section 411 IPC (receiving stolen property through criminal breach of trust) and Section 120 (B) (criminal conspiracy) and Mohan under Section 409 IPC (criminal breach of trust) and various provisions of the Prevention of Corruption Act.

The court, however, granted the two accused two weeks time to appeal to the Supreme Court against its order.

According to CBI Joint Director S.K. Rout and Deputy Inspector General of Police Arup Patnaik, this is the biggest ever conviction so far in any economic offence case in the country.

The court, however, acquitted former Canfina Assistant Vice-Presidents M.K. Ashok Kumar and Balasubramaniam of all charges levelled against them by the CBI.

Rejecting Dalal’s contention that the offence for which he was being convicted was purely technical and not an economic one, the Judge observed that the offence was of "grave nature and time has come to pass on the message to everyone that there may be delay but justice will certainly follow".

Justice Variava agreed with CBI counsel Vishwas Gupte and Raja Thakre that such offenders should be dealt with severely and "this is not a case where there are mitigating circumstances but only aggravating circumstances".

Both Dalal and Mohan had been convicted on August 14 for entering into fraudulent transaction by which the latter abused his position as a public servant to cause loss to Canfina. The court had deferred till today its order on quantum of sentence to be awarded to the two accused.

The CBI had contended that Dalal had entered into transactions with Canfina from which he owed Rs 25 crore to the latter. Instead of paying this amount he offered to sell "cansigo units" worth Rs 33 crore, which were not in his name and also not transferable.

In this process, he not only got Rs 25 crore, otherwise payable by him to Canfina, but also received a cheque for Rs 7.98 crore.

A total of 44 scam-related cases registered by the CBI were being tried by the special court. Of these, Mumbai accounted for 11 cases.

The CBI filed a case against Dalal, Mohan, former executive Vice-Resident M.K. Ashok Kumar and former Assistant Vice-Resident Balasubramaniam of Canfina in 1994.