Daiichi plea: Supreme Court allows Yes Bank to auction land

The Supreme Court on Thursday allowed Yes Bank to auction agricultural land that former Fortis Healthcare promoters Malvinder Singh and his brother Shivender Singh had offered as collateral against a loan of Rs 1,065 crore taken between 2015-16. Japanese pharma gaint Daiichi Sankyo had opposed sale of the land.

A bench led by Justice UU Lalit while dismissing Daiichi’s appeal, said there was “no reason to interfere” with the Delhi High Court’s October 15 order that allowed the sale of 12 bigha of land in Mehrauli belonging to RHC Holding.

The Singh brothers had in 2019 defaulted on two loans of Rs 500 crore and Rs 565 crore sanctioned by Yes Bank between February 2015 and December 2016 to companies controlled by them. The bank had moved to sell the property, which Daiichi had opposed on the ground that the HC had asked the parties to maintain status quo on the assets.

The pharma major also cited various undertakings and assurances given by the Singh brothers to the HC against disposing of their assets in its petition for enforcement of a Rs 3,500-crore arbitration award against the brothers. The award was pronounced by a Singapore tribunal against the brothers for concealing information regarding wrongdoing at Ranbaxy Laboratories while selling it to Daiichi for $4.6 billion in 2008, the appeal said.

Challenging the HC order, the pharma giant also alleged that certain banks and financial institutions colluded with Singh brothers to dilute the shareholding in Fortis Healthcare. It also alleged that Yes Bank had disbursed a part of the loan in violation of the RBI’s 2015 circular that mandates execution of a loan agreement before such disbursement. It said “…this was an engineered default, structured to defeat the rights of the Decree Holder (Daiichi)… The totality of the conduct of Yes Bank inevitably points to fraud and collusion between Yes Bank and the Judgment Debtors (Singhs) with an intention to defeat the execution proceedings”.