The High Court of Karnataka has rejected the petitions filed by Azim H. Premji, former Chairman and Managing Director of Wipro, his wife, and three others, questioning the summons issued by a city court in a case of alleged illegality in transfer of assets, worth around ₹44,000 crore, from three companies into a private trust and a newly formed company.

Justice John Michael Cunha passed the order while dismissing the petitions filed by Mr. Premji, his wife Yasmeen Azim Premji, and one P. Srinivasan, and M.R. Bhat, presently Regional Director (Southern Region), Ministry of Corporate Affairs, and Venkateshwara Rao, a chartered accountant.

The City Civil and Sessions Court on January 27, 2020 issued summons to them on a private complaint filed by India Awake for Transparency, a Chennai-based company.

The High Court, in its May 15 order, said that there was nothing wrong in the trial court’s order of taking cognisance of the offences of criminal breach of trust and corruption by prima facie holding that there are ingredients of offences as the trial court was not required to examine the correctness or otherwise of the allegations while taking cognisance of offences.

It was claimed in the complaint that Mr. Premji, his wife and Mr. Srinivasan were entrusted with the dominion over the properties and assets of three companies — Vidya Investment and Trading Company Private Limited, Regal Investment and Trading Company Private Limited, and Napean Trading and Investment Company Private Limited — as directors and they were holding the assets of worth about ₹31,342 crore in fiduciary capacity, without having any financial interest or ownership.

Pointing out that these three companies had total assets of ₹51,549 crore, the complainant had alleged that by taking advantage of their position as directors, during 2010-2012, the trio took away ₹13,602 crore of assets of the three companies by way of gifts and transferred the same to a private trust controlled by Mr. Premji and his wife.

In respect of the remaining assets of ₹31,342 crore, it is alleged they had conspired among themselves and merged the three companies into a new company called Hasham Investment and Trading Company Private Limited [a company wholly owned by the private trust run by Mr. Premji and wife] without any payment, and through this device they got control over the assets worth ₹31,342 crore belonging to the three companies.

Mr. Rao, who was appointed by the High Court for the process of amalgamation of these companies, and Mr. Bhat, who was then Registrar of Companies, Karnataka, connived in these illegal transactions of huge assets, which otherwise would have vested with the Union of India as bona vacantia or escheat, it was alleged in the complaint.