In another twist to the protracted battle against Fortis Healthcare and Japan’s Daiichi Sankyo, the former has filed an appeal in the Supreme Court against a recent Delhi high court order requiring a forensic audit of its dealings with IHH Healthcare and RHT Health Trust.The case relates to Daiichi Sankyo’s efforts to enforce its arbitral award against the erstwhile promoters of Fortis Healthcare, Malvinder and Shivinder Singh, and to a complex ownership dispute rooted in a legal battle between the parties.At present, Malaysia-based IHH holds a controlling stake in Fortis Healthcare. Prior to IHH’s takeover, Fortis was operated by Singapore-based RHT Health Trust, and thereafter funds infused by IHH were subsequently used to buy out the trust.A Special Leave Petition (SLP) filed by Fortis before the Supreme Court on September 16, a copy of which was accessed by TOI, says the Delhi high court order issued far-reaching directions based on what it described as highly prejudicial findings against Fortis Healthcare, even though the company was not a party to the arbitration proceedings, and wholly unconnected to the underlying arbitration.Fortis, said it is a publicly listed company and “the consequences of the high court order fall not on the wrongdoers, but on the approximately 2.5 lakh public shareholders and IHH, the ‘white knight’ that rescued it’.The Delhi HC gave the order in enforcement proceedings arising from a 2016 arbitral award of Rs 2,562 crore in favour of Daiichi, on account of fraudulent misrepresentations by the Singh brothers, in relation to the sale of Ranbaxy Labs.“Notably, the Petitioner was never a party to those proceedings in any capacity whatsoever and had no role in the dispute”, the SLP says. Daiichi has claimed that the amount outstanding has since risen to around Rs 5,300 crore.“The order violates well-established principles of company law that no attribution (i.e., holding a company responsible for the acts of its directors) can apply to a listed company like the petitioner (Fortis) with lakhs of shareholders”, the petition says.“FHL was never a party to the arbitration, the arbitral award, or the proceedings in which the Singh Brothers gave their undertakings. A listed company is a separate legal person from its promoters and cannot be made answerable for the personal debts and personal undertakings of individuals, merely because they once sat on its board”, legal sources said.
