Markets

Funds diversion case: SEBI issues notice to Fortis’ subsidiary

Our Bureau Mumbai | Updated on April 16, 2021

The management and board are evaluating the notice received by Escorts Heart Institute in consultation with its legal advisors

Securities and Exchange Board of India (SEBI) has issued a notice to Fortis Healthcare Limited in the case related to diversion of funds by the company’s former promoters.

“The management and Board of the Company that was newly constituted after NTK Ventures Pte Ltd (a wholly owned subsidiary of IHH Healthcare Berhad) became promoters of the Company, are evaluating the notice received by Escorts Heart Institute and Research Center Limited (a subsidiary of Fortis), in consultation with its legal advisors,” Fortis Healthcare said in stock exchange filings.

In 2018, the market regulator had asked Fortis Healthcare to take all necessary steps to recover ₹403 crore along with due interest from Malvinder Singh, Shivinder Singh and other entities including Religare Finvest Limited. SEBI has said that money should be recovered within three months.

The funds were reported on the balance sheet of Fortis Healthcare Ltd as cash and cash equivalents, but the money was routed and placed under the control of the Singhs at the time. Fortis’s auditor, Deloitte Haskins & Sells LLP, refused to sign off on the company’s second-quarter results until the funds were accounted for or returned, the people said, asking not to be identified as the information is private.

Published on April 16, 2021

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