Karvy Stock Broking Limited has two months to respond to PMLA notice – The New Indian Express

HYDERABAD: Telangana High Court Judge K Lakshman has given Karvy Stock Broking Limited (KSBL) and nine others two months to file their explanation to the show cause notice issued by the arbitration authority under the Prevention of Money Laundering Act (PMLA) 2002. It is made clear, however, that the petitioners in both written petitions should not seek further extensions and should submit explanations within the said extended period of two months, bearing in mind the object and legislative intent of section 8 of the act, that the adjudication process is time-limited.

The Central Crime Station (CCS) in Hyderabad filed a complaint against KSBL and its directors in 2021, against Karvy Limited and its director for violations of Section 420 of the IPC. They are accused of not having repaid debts which have been qualified as fraudulent accounts. The ED initiated the investigation under the provisions of the Act.

Several additional FIRs filed in the case were also considered. C Parthasarathy, Chairman of Karvy Group of Companies, was detained by the judiciary at Chanchalguda Central Jail in Hyderabad for multiple offenses from August 19, 2021 to May 25, 2022.

According to the ED survey, outstanding loans in KSBL’s accounts as of March 31, 2020 stood at Rs 1,705.23 crore. KSBL illegally obtained these loans from banks/financial institutions by claiming the customers’ shares as its own. In addition, KSBL illegally transferred shares of fully paid clients/who owed no payment to the company and pledged them to banks/financial institutions. This amounted to a flagrant abuse of the client’s power of attorney granted to KSBL/Applicant.

HYDERABAD: Telangana High Court Judge K Lakshman has given Karvy Stock Broking Limited (KSBL) and nine others two months to file their explanation to the show cause notice issued by the arbitration authority under the Prevention of Money Laundering Act (PMLA) 2002. It is made clear, however, that the petitioners in both written petitions should not seek further extensions and should submit explanations within the said extended period of two months, bearing in mind the object and legislative intent of section 8 of the act, that the adjudication process is time-limited. The Central Crime Station (CCS) in Hyderabad filed a complaint against KSBL and its directors in 2021, against Karvy Limited and its director for violations of Section 420 of the IPC. They are accused of not having repaid debts which have been qualified as fraudulent accounts. The ED initiated the investigation under the provisions of the Act. Several additional FIRs filed in the case were also considered. C Parthasarathy, Chairman of Karvy Business Group, was detained by the judiciary at Chanchalguda Central Jail in Hyderabad for multiple offenses from August 19, 2021 to May 25, 2022. According to the ED investigation, loans in course in the accounts of KSBL on March 31, 2020, was Rs 1705.23 crores. KSBL illegally obtained these loans from banks/financial institutions by claiming the customers’ shares as its own. In addition, KSBL illegally transferred shares of fully paid clients/who owed no payment to the company and pledged them to banks/financial institutions. This amounted to a flagrant abuse of the client’s power of attorney granted to KSBL/Applicant.