iD Desk
iD Desk
The Reserve Bank of India (RBI) had admitted that the Margadarsi Finance Limited had violated the norms and collected deposits from the people. The RBI opened up for the first time in the case in the Supreme Court on Tuesday.
The advocate for the RBI told the court that the Margadarsi had gone against its Act 45S by collecting deposits from the people. It was a clear violation of the set rules, the RBI told the supreme court. It further said that the Margadarsi is a Hindu United Family (HUF) company, and it was not entitled to collect deposits from the people.
However, the Margadarsi collected deposits to the tune of Rs 2,600 crore in violation of the rules of the RBI. The State government advocate further informed the court that Margadarsi had collected another Rs 2,500 crore worth of deposits from the people.
The court, on hearing the case, posted it for further hearing on April 9. Congress former MP, Vundavalli Arun Kumar told the media that it was good that the RBI had entered the case. The RBI’s statement proves that the Margadarsi had indulged in financial irregularities.
Andhra Pradesh state government advocate Niranjan Reddy also told the court that the Margadarsi had committed several financial blunders and it required stringent action. He wanted an investigation by the financial agencies to find out the financial irregularities of the company.
It is now to be seen what decision that the supreme court would take in the issue as the RBI had categorically said that the collection of deposits is against its law. It is also to be seen how the Margadarsi would save its skin as the RBI had entered the battle.
Vundavalli Arun Kumar had been fighting against the financial irregularities of the Margadarsi for the past one decade. He filed several cases against Margadarsi over the years.
