Raju brothers bail decision on Saturday

The claim of former Satyam chairman B Ramalinga Raju that he had infused Rs1425 crore into the company was given a new twist on Wednesday when the Central Bureau of Investigation charged the firm with investing Rs175 crore of this money to acquire preferential shares of Nipuna Services, a Satyam business process outsourcing company promoted by Ramalinga and his brother Rama Raju.

The payment for the preferential shares was made out of Rs1425 crore received from 37 front companies of Satyam Computer Services, the CBI told a court here during arguments over the bail applications of the Raju brothers and the company's former chief financial officer, Srinivas Vadlamani.

The court reserved till Saturday orders on the bail pleas as also on an application by the CBI to subject the three accused to a lie detector test and brain mapping.

The CBI, in its chargesheet submitted to the court a few days ago, backed the claim of the government-appointed board of the company that the firm did not owe any money to the front companies floated by Ramalinga Raju. It recalled that he had claimed to have infused Rs1425 crore into Satyam by pledging shares held by his family in several front companies. Ramalinga Raju's contention was that Satyam owed Rs1,230 crore to his family members out of the money that he claims to have brought in.

The CBI, however, lent no credence to his claim as it found no proof that the latter had infused money. The agency said it found no entries in this regard in Satyam's books of accounts. It recovered only letters written by directors of 37 front companies on 8 January staking a claim for money lent to Satyam. These letters were written at the behest of Ramalinga Raju, it said.

Opposing the bail applications on the ground that it would hamper investigations, CBI special public prosecutor Balla Ravindranath said the investigation also revealed evidence of benami share transactions by Raju in the names of trusted employees of Satyam, front companies and his relatives.

His brother Rama Raju conspired with Ramalinga to ensure the transfer of Rs194.6 crore from the Satyam account to a company floated by the former and his family members without the consent of the board. Rama Raju was also responsible for converting the proceeds from such deals into assets acquired for 327 group companies, the CBI argued.