The Madras High Court has stayed all further proceedings in an inquiry initiated by the Directorate of Enforcement (ED) against DMK MP S. Jagathrakshakan with respect to purchase of shares of Chrome Leather Company Private Limited in 1995.
Justices N. Kirubakaran and V.M. Velumani also called for the records of a civil suit filed in 1963 from the custody of a judicial magistrate in Chengalpattu. The High Court Registry was directed to obtain the records in a sealed cover within four weeks.
The interim orders were passed on a writ petition filed by the MP challenging the summons issued to him by the ED on June 12 this year. The judges wondered how could action be taken now for transactions that took place in 1965 and 1995.
Senior counsel C. Manishankar and advocate N. Senthil Kumar, representing the petitioner, told the court that the shares of the leather company held by one Ida L. Chambers was the subject matter of a civil CB-CID suit filed in the High Court in 1963.
On February 19, 1965, a decree was passed by the court on the basis of a compromise reached between the shareholder and his stepson Roy Edwin Medcalf Chambers. Thereafter, the shares were sold to one Nagappa Chettiar on April 21, 1965.
The purchaser pledged the shares with Central Bank of India in 1970 and availed loans. As there was default in payment of loan, the company was auctioned and VKK Charities was declared the successful bidder on whose behalf the MP had purchased the shares in 1995.
“After passage of more than four decades, the present complainant, who appears to have been in a deep slumber, has suddenly woken up like Rip Van Winkle and lodged a police complaint on June 20, 2007, alleging forgery of share certificates by Nagappa Chettiar,” the Bench said.
The police closed the complaint after terming it as a mistake of fact. However, in 2013, the Crime Branch-Criminal Investigation Department (CB-CID) wanted to reopen the investigation but a Judicial Magistrate in Chengalpattu refused permission.
The CB-CID filed a revision against the refusal and obtained an order for further investigation from an Additional Sessions Court in 2016. Subsequently, the FIR was assigned a new crime number though it was booked on the basis of a complaint lodged in 2007.
It was only after all these proceedings, the ED had begun a parallel probe under the Prevention of Money Laundering Act of 2002. The judges pointed out that the complainant Q. Dawson was the power of attorney holder of one George Joseph Chambers and both of them had been castigated by the court on many occasions.