Satyam case: Ramalinga Raju, his brother and 2 others sentenced to 6 months' imprisonment

B. Ramalinga Raju, the former chairman of Satyam Computer Services Ltd, his brother and managing director B. Rama Raju, former whole-time director of Satyam, Ram Mynampati and Former chief financial officer Vadlamani Srinivas were handed six months’ imprisonment by an economic offences court in Hyderabad, in the cases filed by the Serious Fraud Investigation Office (SFIO) of the Ministry of Corporate Affairs under the Companies Act. Raju was also fined a total of Rs.10.5 lakh in six different cases filed by the Serious Frauds Investigations Office (SFIO).

 

Ramalinga Raju : a file picture

The court also imposed fines of different amounts to 11 individuals who figured in the seven cases filed by the SFIO. The highest fine of Rs. 2.66 crore payable in two months was for Krishna G. Palepu, a director then. Former Satyam directors Vinod Dham, Mangalam Srinivasan, M. Rammohan Rao, T.R. Prasad, V.S. Raju have been fined Rs.20,000 each.

SFIO filed a total of seven cases for violations in auditing process and Companies Act. The court acquitted the accused in one case relating to the payment of dividends and restricted the sentence to mere fine in two others. In the remaining four cases, imprisonment was awarded to the Raju brothers, whole time director Ram Mynampati and chief financial officer Srinivas Vadlamani. All the accused, except Mr. Palepu, were present in the court when the verdict was pronounced by the judge K. Laxman. The Court also issued a non-bailable warrant against Palepu, who was not present in the court on Monday.

However, the operation of the imprisonment and fine was suspended for a month to enable the accused to appeal in a higher court. 

The cases where the sentence was restricted to a fine of Rs. five lakh each on the accused related to balance sheets for 2006-07 and 2007-08 where professional charges were paid to Mr. Krishna Palepu in addition to his normal salary without the opinion of the Centre considering his qualifications. Incomplete particulars in balance sheets were pointed out in the other case. 

The accused were awarded imprisonment for merely disclosing amounts of dividend remitted in foreign currencies without identifying the number of non-resident shareholders, failure to disclose information about payments to auditors on taxation and company law matters, lack of details about employees in balance sheets from 2003 to 2008 and giving distorted figures of profit and loss.