Bharatiya Janata Party (BJP) leader Subramanian Swamy has filed a public interest litigation (PIL) before the Delhi High Court alleging a scam of nearly ₹5,100 crore in Axis Bank making “undue gains” by way of transactions in shares of Max Life Insurance [Dr Subramanian Swamy v Union of India and Ors].
As per the plea, there was blatant fraud in Max Life Insurance and Max Financial Services allowing their shareholder, Axis Bank Limited and its group companies, Axis Securities Limited and Axis Capital Limited to make "undue profits/gains from the purchase and sale of equity shares of Max Life in non-transparent manner”.
The transactions were in violation of the mandatory directions of the Insurance Regulatory and Development Authority of India (IRDAI), Swamy said in his plea.
Therefore, the transaction should be investigated by a committee of experts, he contended.
The plea was heard today by a Division Bench of Acting Chief Justice Manmohan and Justice Manmeet Pritam Singh Arora.
Senior Advocate Rajshekhar Rao appeared for Swamy and contended that for much smaller offences, the Enforcement Directorate (ED) has come into action but even though the total quantum in this case is more than ₹5,100 crore, nothing has been done.
Senior Advocate Mukul Rohatgi appeared for Axis Bank and said that he has not been served an advance copy of the petition.
Rohatgi said that though an email was sent to his side, the petition attached could not be opened.
The Court asked Swamy’s counsel to provide a copy of the plea to Rohatgi and adjourned the case to March 13.
In the PIL, Swamy argued that the issue is of national importance and financial security of the citrizens of the country.
He contended that Axis Bank group companies bought 12.002 % shareholding in Maxlife ₹Rs 31.51/ ₹32.12 per share at total consideration of 736 Crores, which is evidently below the fair market value.
“On simple calculation, resulting to make undue profits/gains from the purchase on the sale of equity shares of Max Life in non-transparent manner, Axis Bank has unlawfully gained approx ₹4000 Crores,” the plea alleged.
It further said that though the IRDAI imposed a penalty of ₹3 crore on Max Life for misrepresentation, the penalty is negligible compared to the total fraud committed.
Senior Advocate Rajshekhar Rao appeared for Subramanian Swamy. He was assisted by advocates Satya Sabharwal and Tanya Arora.
TAGS: Bharatiya Janata Party (BJP) Subramanian Swamy Public Interest Litigation (PIL) Delhi High Court Axis Bank Max Life Insurance Max Financial Services
