Andhra HC finally stays proceedings against Kampan

The high court in Hyderabad granted a stay on Wednesday on all further proceedings, including any arrest, on Nimesh Kampani, investment banker and chairman of JM Financial, in the Nagarjuna Finance default case.

This case has caused much comment as Kampani was a non-executive director of Nagarjuna Finance and is being held responsible. In fact, he is supposed to have left the board before the said default.

The order given by Justice K C Bhanu also covers the lookout notice served on him and proceedings in various lower courts.

The Nagarjuna group incorporated NFL as a non-banking financial institution and collected Rs 98.3 crore (Rs 983 million) from 85,160 depositors in 1997-98. It defaulted on repayment after the maturity.

Kampani stepped down from the board in 1999, before the default. However, the state police served a lookout notice on Kampani in the case. He was said to be in Dubai for several months to avoid arrest.

Kampani filed a petition in the HC last week for quashing further proceedings against him. The court orders would be communicated to the Central Bureau of Investigation, which in turn would send out information about the lookout orders being lifted.

The same court, on August 20 this year, had dismissed a petition filed by Kampani seeking anticipatory bail in the same case for the second time. He agreed to pay Rs 1 crore (Rs 10 million) as surety, surrender his passport and cooperate with investigating agencies but wanted an assurance from the court that he would not be handed over to the police for custodial interrogation.

Earlier, Kampani had moved the Supreme Court contesting the AP court's ruling that dismissed his request for bail. The apex court order went against him.

Image: Nimesh Kampani