Fortis Healthcare seeks legal action against Singh Bros

Fortis Healthcare Ltd (FHL) has asked the markets regulator Securities and Exchange Board of India (Sebi) to initiate legal proceedings against its former promoters, the Malvinder and Shivinder Singh, after the brothers along with related entities failed to repay Rs 476 crore.

In an application to Sebi, FHL and Fortis Hospitals have petitioned under Section 28A of Sebi Act for recovery of the amount from Malvinder Mohan Singh, Shivinder Mohan Singh, RHC holdings Pvt Ltd, Shivi Holdings Pvt Ltd, Malav Holdings Pvt Ltd, Religare Finvest Ltd, Best Healthcare Pvt Ltd, Fern healthcare Pvt Ltd and Modland Wears Pvt Ltd.

In an emailed response, Fortis chairman Ravi Rajagopal said FHL and FHSL both have filed formal applications before Sebi to bring on record details of actions taken against the erstwhile promoters and other entities including for recovery.

Fortis Healthcare has also asked the Sebi for a personal hearing on the matter.

On January 18, the Sebi deadline for notices to pay back money to Fortis expired. A petition was filed by Fortis to Sebi on February 13, also requesting for directions against the aforesaid entities.

The Singh brothers’ current shareholding in Fortis Healthcare is 0.16%, which is already attached in court proceedings. In view of the negligible shareholding of erstwhile promoters, the Fortis Board has recommended and approved declassification of these individuals as well as the companies owned and controlled by them as promoters. Application for de-classification of promoters has also been filed before stock exchanges.

PTI in its report quoting Shivinder Singh said that seeking to invoke Section 28A of Sebi Act is “premature, unfair and against the principles of natural justice” when a final order has not been passed in the matter. Singh has said that he did not have a chance to review or respond to Fortis’s own investigation report, which he has requested and not received till date.

Singh was also quoted as saying that the decisions on Inter Corporate Deposits (ICDs) were taken after his retirement and he had no role to play in their planning or execution.

Rajagopal said Malvinder Singh’s lease of Singapore property has been terminated.