Raffles education board says allegations against him in India are ‘without legal basis’

SINGAPORE (THE BUSINESS TIMES) – Raffles Education Corporation (REC) announced on Thursday (June 2) that it learned that subpoenas had been issued by an Indian magistrate against the company, certain current and former directors, employees and a consultant.

The opinion of his legal adviser in India is that the allegations are “baseless and baseless”.

The latest update relates to a case, first reported in October last year, registered with the Economic Offenses Wing (EOW) of the Delhi Police.

REC had previously announced that a closure report had been filed. But in its Thursday filing, REC said the case had been reopened following allegations made by a company associated with Mr. Shantanu Prakash, founder of Educomp Solutions and a former business partner of REC.

After the completion of further investigations, EOW filed an indictment in a Delhi District Court, alleging, among other things, theft, forgery and extortion against Mr. Prakash and his associates.

The court magistrate ordered the issuance of subpoenas against the company and its chairman Chew Hua Seng, directors Lim How Teck and He Jun, and former directors Gan Hui Tin and Teo Cheng Lok.

Subpoenas have also been issued against current employees: Mr. Chew’s wife, Doris Chew, his son Chew Han Wei, legal director John Tham and Mr. Saurabh Sharma, a consultant for one of the 100 % REC in India.

The company and the accused persons have not yet received such summonses, the REC said.

In its file, the group indicates that it intends to “rigorously defend its position”. There is also a “good chance” that the case will be overturned, according to his legal adviser in India.

The Indian class counsel believes that the accused persons who are directors or principal officers were only named in the indictment by virtue of their designations in the company at the relevant time.

For the accused persons who are employees but not directors or senior executives, the Indian attorney believes that they too could successfully maintain a challenge to the summons as the allegations against them are also baseless and baseless.

The subpoena order and the resulting lawsuits against the company and other defendants can be considered an “abuse of process”, the REC said.

REC, Educomp and Mr. Prakash have had a long-standing dispute.

An arbitral tribunal in India had issued an arbitration award against Educomp and awarded REC damages of around 163.2 million rupees (S$2.9 million) – a decision REC said Educomp did not had not complied with to date. The arbitration proceedings related to breaches of a stock purchase agreement.

REC also reiterated points from an earlier announcement that Mr. Prakash has several ongoing civil and criminal investigations in India against him.

REC shares were trading at 6.1 cents at 2 p.m. Friday.

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