The Custodian too has alleged that all the properties listed above, in particular those held by Classic Credit, Classic Shares & Stockbroking Services have been purchased out of Ketan Parekh’s money and are hence his ‘benami properties’ and need to be investigated. It has sought the direction of the court to get to the bottom of Parekh’s repayment of Rs 72.2 crore to MMCB and to acquire all the immovable properties listed in the application. It has requested the Court to direct Ketan Parekh, the two Classic companies and the two Panther companies to submit their audited accounts from 2001-02 along with Income Tax returns to the Custodian for investigation.

Interestingly, while media reports from Gujarat have mentioned that Ketan Parekh has repaid over Rs 223 crore in connection with MCCB, it is not clear why the Custodian mentions a mere Rs 72.2 crore that he admits to repaying between 2002 to 2005. His own statement attached to the Custodian’s application says he has “endeavoured to repay outstanding amounts” to companies he was associated with or for which he stood guarantor. It is not clear if this actually led to any payments.

Interestingly, when this powerful bull market began in 2004, Ketan approached MCCB with the offer of a one time settlement, which the bank discussed and then rejected in 2004. It then filed for an application for cancelling his bail for his failure to pay Rs 380 crore within a three year period. This is less than half the money (Rs 880 crore) that was allegedly scammed out of MCCB by Parekh alone and mentioned in the JPC reports.

... contd.