The Supreme Court Today (July 21) lifted the Bombay High Court’s stay and allowed the Maharashtra Police to resume investigation into alleged Rs 1,243 crore financial scam at Lilavati Hospital. The case involves former trustees and medical vendors in a long-standing corruption probe.
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NEW DELHI: The Supreme Court of India has given the green signal to Maharashtra Police to carry on with their investigation into serious financial fraud allegations related to Lilavati Kirtilal Mehta Medical Trust, which runs the famous Lilavati Hospital in Mumbai.
This came after the Bombay High Court had earlier stayed the investigation, but now the Supreme Court has stayed that High Court order, making way for the probe to continue.
The Supreme Court’s decision came from a bench led by Justices PS Narasimha and AS Chandurkar, who were hearing a petition filed by the Lilavati Trust. The Trust was challenging the Bombay High Court’s July 4 interim order, which had temporarily stopped the investigation started by the Economic Offences Wing (EOW) of the Maharashtra Police.
The background of this case dates back to 2005. The petitioners claim that some former trustees of the hospital trust were involved in illegal and overpriced purchases for nearly 20 years. These deals allegedly involved related vendors and resulted in the misuse of over Rs 1,243 crore. Audits pointed out that prices were tampered with, inventory records were manipulated, and fake documents were used.
The people named as accused in this case include Chetan Mehta, Niket Mehta, Rashmi Mehta, Bhavin Mehta, and a few others. It also includes the directors of Akna Medical and related companies. A forensic audit revealed that purchases from Akna Medical and its partners alone amounted to over Rs 1,200 crore.
An FIR (First Information Report) was registered on March 6 following an earlier order by the Judicial Magistrate at Bandra’s 12th Court on February 28. This Magistrate had taken action based on a complaint that was backed by employee statements and a forensic audit report.
It alleged that the former trustees and some private vendors were involved in financial mismanagement and illegal purchase deals. After this, the former trustees moved the Bombay High Court to try and cancel the FIR.
On July 4, the Bombay High Court passed an interim stay on the ongoing probe.
The Lilavati Trust and its legal team argued in the Supreme Court that this stay order by the High Court was passed without informing either the complainant or the EOW, which is handling the investigation. They also mentioned that
“The State’s Public Prosecutor had not been served with the writ petition at the time of hearing.”
Additionally, the EOW was not even made a party to the High Court petition, “despite being the investigating authority.” The Trust also pointed out that such an ex-parte order (passed without hearing the other side) was:
“Contrary to the principles laid down by the Supreme Court in Neeharika Infrastructure Pvt Ltd v. State of Maharashtra and Asian Resurfacing of Road Agency v. CBI.”
After listening to these arguments, the Supreme Court stayed the Bombay High Court’s order, which means the investigation by EOW can now go forward without any legal blocks.
- The Lilavati Trust was represented by a team of senior lawyers including Abhishek Manu Singhvi, Mukul Rohatgi, and Devadatt Kamat, along with advocates Utsav Trivedi, Manini Roy, and Piyush Tiwari from TAS Law.
CASE TITLE:
Lilavati Kirtilal Mehta Medical Trust Vs State of Maharashtra
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