Ex-NSE head Chitra Ramkrishna was major player in conspiracy, projected proceeds of crime as untainted: Delhi Court

While denying bail to former National Stock Exchange (NSE) Managing Director Chitra Ramkrishna, a Delhi court on Monday observed that she was the major player in the money laundering and illegal phone-tapping case registered by the Enforcement Directorate (ED) [Chitra Ramkrishna v. ED]..Special Judge Sunena Sharma underlined,“She was the one who accorded approval to the facade contract of study of cyber vulnerabilities. She was the one who used to identify the phone numbers for recording of conversation and was supplied with the transcript of said conversation by the iSec. The applicant was having the dominion over the properties and funds of the NSE and was responsible to discharge her duties in the interest of the NSE.”.According to the ED, NSE’s top officials, including Ramkrishna, conspired with a private company called iSec, for illegal tapping of phone calls and snooping of NSE’s employees.The same, it was alleged, was carried out under the guise of this legal contract under which some suspicious numbers identified by Ramkrishna were given to iSec for recording. iSec in turn allegedly prepared the transcripts of the recorded conversations of these numbers and shared it with her and other top NSE officials.Monetary loss was caused to NSE by allowing iSec to gain money out of said illegal activity done under the guise of a legitimate contract of study of cyber vulnerabilities. It was claimed that with active assistance of Ramkrishna and other top officials of NSE, iSec was able to generate ₹4.54 crore and give it a colour of untainted money by showing it to have been earned through a legitimate source..Appearing for Ramkrishna, Senior Advocate Rebecca John had argued that complaint that led to the registration of the first information report (FIR) and Enforcement Case Information Report (ECIR) was filed on behalf of the Union Ministry of Home Affairs and not by the NSE or its employees, who were allegedly cheated by the accused persons.Therefore, the senior lawyer contended that no prosecution for the offence of Section 420 (cheating) of Indian Penal Code could be initiated on the complaint of a person other than the person aggrieved or the person allegedly cheated.ED’s special counsel Zoheb Hossain argued that at a nascent stage of investigation of both the ECIR and the predicate FIR, no finding could be recorded regarding the presence or absence of essential ingredients of the predicate offences. Further, for the consideration of bail, the matter was to be assessed only on the “broad probabilities” of the case..The defence counsel also relied on the first proviso to Section 45(1) Prevention of Money Laundering Act, saying Ramkrishna being a woman was entitled to the benefit of bail.“In this regard, I may mention that extension of said benefit cannot be claimed as a matter of right as the discretion lies with the court to exercise such powers only in suitable cases. However, I do not find the case fit for exercise of such discretion in favour of applicant for the reason that during relevant time when the alleged offences were committed, the applicant was holding key positions of DMD/MD/JD in NSE and was actively involved in all important affairs of the company,” the court pointed out..According to the court’s prima facie opinion, under the guise of a study, illegal phone-tapping was carried out by using the direct lines of MTNL. For this purpose, the software and hardware of the recording/monitoring server, which was purchased by iSec for NSE from Nexco Techno Solution, was allowed to be installed in the upper basement of the NSE building.“The material on record is sufficient to prima-facie show that the applicant was the major role player in the entire conspiracy as well as in projection of proceeds of crime as untainted money. In the backdrop of these circumstances, there is absolutely no reasonable ground for this court to record any such opinion that the accused/applicant is not guilty of the offence alleged against her especially at this stage when the investigation is yet not complete,” the court held..The case is related to a February 11 order of the Securities and Exchange Board of India (SEBI) that found Ramakrishna allegedly involved in financial misdeeds relating to fixation and frequent revision of another NSE official Anand Subramanian’s compensation in a disproportionate manner, in cahoots with someone whom she claimed to be a “Siddha Purusha”..[Read Order]