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J. Venkatesan

New Delhi, July 15 The Supreme Court on Tuesday declined to grant further time to Mr Ketan Parekh, the prime accused in the 2001 Madhavpura Bank scam, for depositing Rs 26.43 crore, the instalment amount due on May 1 as a condition to be on bail.

A bench of Mr Justice Ashok Bhan and Mr Justice V.S. Sirpurkar dismissed Mr Parekh’s application for extension of time. One of the conditions for grant of bail was that Mr Parekh should make payment in instalments without any default and as per the order dated May 17, 2007, the bail stands cancelled in view of the default.

In its application seeking cancellation of the bail, the bank said in 2001 that a massive fraud was perpetrated on the bank by Mr Parekh — by siphoning off funds of small investors and depositors who had deposited their monies with the bank. It said Mr Parekh was to pay approximately Rs 396 crore in instalments and Rs 26.43 crore was due as on May 1, 2008. It pointed out that as per the May 2007 order “if any default is made in the deposit of instalment as per schedule prescribed by the apex court, the bail granted to Mr Parekh shall be deemed to have been cancelled and he shall surrender to serve his sentence”.

It said that on May 2, the bank wrote to the CBI (Mumbai) requesting the arrest of Mr Parekh since he did not pay the last instalment of Rs 26.43 cr. It said the “poor and unsuspecting depositors” had faced “great trauma” because of the fraud and misdeeds committed by Mr Parekh.

In another application, the bank sought enhancement of the amount due from Rs 396.41 crore to Rs 949.67 crore being the outstanding principal amount as of August 24, 2001.

It said despite the promise of making the payment in three years, more than six years had passed and Mr Parekh had paid only Rs 370 crore. The bank sought a direction to Mr Parekh to pay a further amount of Rs 579.67 crore.

The bench ordered notice to Mr Parekh on this application and posted the matter for further hearing in August.

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