Plethico Pharmaceuticals investment fraud case: Court grants bail

The directors of Plethico Pharmaceuticals, who were arrested last week for an alleged investment fraud case of Rs. 172 crore filed by investors, have been granted bail. The arrested accused, including Shashikant Patel, 73, and his son Chirag Patel, 44, are directors of Plethico Pharmaceutical Ltd.

The Economic Offences Wing of the Mumbai Police arrested them for duping more than 18,000 investors from all over the country of Rs. 172 crore on the pretext of creating fixed deposit accounts.

The investors had filed the compliant in 2015 against an Indore-based Plethico pharmaceutical company stating that the Plethico pharmaceutical Ltd floated a scheme to make the fixed deposits in the company and the company will give them 11 to 12.75 percent interest for their investment amount. The investors stated that in 2011, 2012 and 2013 they took fixed deposits from them to the tune of Rs. 172 crore, as is reported by HT.

According to the sources, the duo faced the heavy losses in their business and could not repay the money as promised. The investors waited for two years but when they realized that they will not be getting their money back, decided to take the legal recourse.

In 2015, the investors lodged a complaint and the police filed a FIR under IPC sections of cheating and criminal breach of trust and relevant sections of Maharashtra Protection of Interest of Depositors (MPID) Act.

An officer told to Express, “As many as 18,455 investors had invested in the company, of which 7,000 were from Maharashtra. Once the firm started defaulting, the investors lodged a complaint. We probed the allegations and found that the company had indeed cheated them."

During the interrogation, the duo said that they offered the investment scheme for their business but due to the heavy loss in their business, were unable to pay their investors. On the company website, they also posed false information about the company, calling it a leading global healthcare / pharmaceutical company with a strong emphasis on the herbal and nutraceutical segments, reports Express.

Their Advocate Sudeep Pasbola stated that while the Economic Offences Wing claimed that 18,000 investors were allegedly not repaid the deposits—with the amount being pegged at Rs.172 crore, only 135 people have come forward and the irregularity is of Rs 3.5 crore.

He further said, “The duo have been granted bail by the court. They got a cash bail of Rs 3 lakh each and the surety was Rs 1 lakh each."