Sitaraman of SBI convicted 23 years after the Securities Scam of 1992 surfaced
Moneylife Digital Team 02 November 2015
Sitaraman who had helped Harshad Mehta as an SBI employee was convicted by the Bombay High Court, along with MS Srinavasan of State Bank of Saurashtra
On 23rd April 1992, when the Times of India first reported that Rs500 crore had been credited to the Big Bull’s (Harshad Mehta’s account) thanks to a missing SGL (Securities General Ledger) receipt, the man at the centre of it all was R Sitaraman, the manager. Over 23 years later, the Special Court set up for the expeditious trial of offences has finally delivered a verdict convicting R Sitaraman and a former chief manager of State Bank of India (SBI) and MS Srinivasan of State Bank of Saurashtra (SBS) in case 1 of 1996. Justice Roshan Dalvi, on her last day in office (30 October 2015) sentenced the two to four years rigorious imprisonment and a fine of Rs5 lakh each for criminal breach of trust and misappropriation of funds and under the Prevention of Corruption Act. The accused have also been asked to pay a compensation of Rs5 crore as compensation for embezzlement. 
The order says, Srinivasan and Sitaraman are “exposed and uncovered to have caused tremendous loss aggregating to several hundreds of crores of rupees to SBS and SBI unbefitting their position as public servants responsible to the public exchequer. They are seen to have degraded themselves in misappropriating public property for illegal and criminal ends causing enormous monetary loss to the public exchequer. Their acts can well be termed anti-national as such acts had caused a tremendous economic strain and drain upon the country resulting in the scam of 1992. The sentence against them must account for wanton economic loss to the country reflecting the deprecation for the subterfuge of accused A1 & A8 and the consequent conundrum caused to our country. They have not only corrupted themselves but corroded the country”.  
Sucheta Dalal, managing editor of Moneylife had broken that story in 1992. She later co-authored a book on the huge securities scam of 1992, titled The Scam, co-authored with Debashis Basu. The book starts with the desperate hunt for Mr Sitaraman by SBI’s vigilance chief at Palani near Coimbatore in Tamil Nadu, where he had gone for his son’s thread ceremony. This was after the Bank had discovered a gaping hole of Rs574 crore in the SGLs that it held.
The events that snowballed after the article was published engulfed the entire banking system and exposed the antiquated systems of the Reserve Bank of India (RBI) public debt office and dangers of brokers dominating the then powerful Bombay Stock Exchange (BSE). 
Some 23 years later, the Court has been able to deliver the verdict on that case. The first paragraph of the judgement itself points to the pointlessness of long-delayed judgements. Of the 22 accused facing trial, three were discharged, three are dead and only two are convicted after 16 were given the benefit of doubt.  Even here, the involvement of one of the two, is not very clear to those who followed and wrote about the case in details two decades ago. 
Justice Roshan Dalvi’s judgement has brought the curtain down on one act of this saga; the final act will be played out in the Supreme Court, probably after another long delay. Ironically, the Special Court at the Bombay was set up under a new act for “expeditious” hearing of the scam cases. Of course, scams of far bigger magnitude have occurred in the country since the securities scam of 1992. 
8 years ago
wrt the readers' outburst in the form of comments on the over 2 decades delay, in the court delivering its verdict, what is more puzzling is the 'reaction', rather than the delay grieved about.

Why should one say so? For finding an answer,simply have in view:


We, as a nation, have some fine qualities but a sense of the value of time is not one of them. Perhaps, there are historical reasons. Ancient India had evolved the concepts of eternity and infinity. So what do years wasted in a litigation matter against the backdrop of eternity. Believing in incarnation, what does it matter if you waste this life. You will have many more lives in which to make good.

Our cases drag on over a length of time which makes eternity intelligible

The law may or may not be an ass but is certainly a snail; cases proceed at a pace as unduly slow in a community of snails.

Justice has to be blind but I see no reason why it should also be lame; here it just hobbles along, barely able to walk.


(A narration from Palkhivala’s published speech (1987) - "The Judiciary and the Legal Profession", in the Book- We, the Nation THE LOST DECADES)

Key Note: It is commonly believed, rightly or wrongly, that the root cause lies in the fact -of -life- for -ages that 'human being', created as the only supposed-to-be rational of all, is still in the process of 'evolution'. Should , however, anyone not mind to go by the wisdom gathered in hindsight,the imponderable requiring an attempt to find an answer is-what is right word to appropriately signify just the reversed process ?!

Hemlata Mohan
8 years ago
If in such an important case where a Spl Court was constituted took 23 years to deliver the verdict,what can the common man expect from the normal courts?
Shame on us!
Mahesh S Bhatt
8 years ago
Stupid delayed justice loses meaning/sense.

Why Judges are getting strength in giving correct judgements on last day pf their tenure is also worth examining.

Sucheta another success Congrats.

Can we have time defined justice like USA?

What laws we need to implement to make it happen is Sucheta your expertise advice GOI/Law Ministry.

8 years ago

Makes for an utterly disgustful read; essentially the extremely wanting / utter absence sense of 'time' and failure of conscious noting of its value, to the humanity at large!

Is it not an obvious instance of proverbial, - HEAD i win, TAIL you lose ?!

POINTS (in abundance) To Ponder:

WHAT IS AILING THE humanity AT LARGE today, more than ever before?

A very useful article,- not to miss any word, or line, or underlying message, to be so found if individual's own mind./brain/ intellect / conscience lends scope to so FIND / REALIZE impromptu – for “SELF MOTIVATION” culminating in "self-improvement" , to start with !


And many, many more- particularly to anyone being a 'public servant', in its most comprehensive sense, - those in PSBs being no exception,to the rules and norms of profound 'ethical behavior'

8 years ago
Throughout the World, the Judiciary exist to shut the stable doors after the horses have fled. But India's judiciary excel. They shut the doors after the stable has collapsed. I was informed by a Senior Advocate that India's courts make a habit of adjourning and delaying cases not because of their incompetence or incapacity to read English, add, subtract, know the law or assess evidence, but, because, they hope that given enough time, the parties will come to an amicable settlement or resign themselves to their fate. This judicial disregard for the rule of law, combined with the Police disinclination to enforce the rule of law encouraged by India's grotesque Constitution and laws have resulted in India. 143 out of 172 countries in Internal Peace and Stability in just 69 fell years.
Vaibhav Dhoka
8 years ago
India is country of belated justice.23 years is more than One generation.Therefore common man avoid to climb staircase of Judiciary as no one can predict when justice will be delivered.As all sectors in life is infested with corruption,judiciary is more infested with corruption and sword of contempt is used to suppress common man's voice.
Sunil Rebello
8 years ago
here justice served late - is better than not served.
but the delay is also criminal. our justice system requires a complete overhaul - in order that justice can be delivered on time to serve its purpose.
by now Srinivasan and Sitaraman may be nearing their life end.
Sucheta Dalal and Debashis Basu this was one of your early scoops.. which you kept building on every day and every year.
May the good Lord bless you both with Good Health and peace of mind.
Shirish Sadanand Shanbhag
Replied to Sunil Rebello comment 8 years ago
I fully agree with Sunil Rebello's views.
How Court will recover the fine from these two culprits is a moot question.
My best wishes to Sucheta Dalal & Dedbashish Basu, for their perseverance, for all these years with judicial proceedings.
Nithya iyer
Replied to Shirish Sadanand Shanbhag comment 7 years ago
Do not simply post comments without knowing the truth. You are talking about culprit what you know what m S Srinivasan underwent in his life. You think justice is served or it is just the actual culprits have escaped making him a scape goat. Think about it. He and his family were left on streets with no money no job and three children. The house wife had to start going for work n surviving with 1k income per month. Srinivasan attending the court cases by travelling to Mumbai in unreserved train and no money to pay to lawyers and had to fight the case on own. All 16 who escaped or acquitted had money to pay to lawyers. While srinivasan was accused and made the scape goat. He lost his son just 2 weeks before the verdict was announced. Even today he travels to court by bus and train. And you speak about him this way without knowing the truth. He is a man of ethics and man of truth. Even in all miseries he will not blame anyone for his misery. That's his nature
Sucheta Dalal
Replied to Nithya iyer comment 7 years ago
In fact nothing is known about Mr Srinivasan. That is a great pity. We had helped Mr Bavedekar, who was also an innocent victim in the scam. we were surprised at the addition of Mr Srinivasan's name to Sitharaman in the verdict. What is the situation. If you know about him, why have you never reached out to help him? Even those of us who covered the scam helped people who were trapped innocently -- like Mr Bavedekar. Aren't you equally responsible for doing nothing? Those who stand and watch ...
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