Criminal Investigation Department (CID), Bengal, arrested industrialist Pawan Ruia from his Delhi residence on late Friday night. The 57-year-old chartered accountant-turned-businessman was arrested on the basis of a case registered at Kolkata’s Dum Dum police station, where the complaint was registered by the Indian Railways alleging theft and fraud. He will be brought to Kolkata for questioning. The prime charges levelled against him are cheating and dishonestly inducing delivery of property as well as criminal breach of trust.
Ruia, as the head of the group, faces charges of theft from the factory of Jessop and Co. Limited, a closed engineering firm. The Ruia Group also controls tyre maker Dunlop India Limited, which too has suspended operations. He was asked to report at the CID headquarters repeatedly in Kolkata, but he did not turn up. The complaint that Railways lodged earlier against Ruia alleged theft of goods worth Rs 50 crore belonging to them kept at the Jessop factory. An FIR was registered under Sections 420, 406 and 409 of the Indian Penal Code. Later, Ruia’s lawyer moved to Calcutta High Court. The Ruia Group had told the High Court that he has nothing to do with Jessop and that he is neither the Chairman of Jessop, nor a shareholder. The High Court directed the CID not to arrest the businessman in condition of his cooperation with the investigative agency. But the CID had earlier also alleged that Ruia was not cooperating with them in the process of investigation.
Jessop & Co operates from a 63-acre premises at Jessore Road in Kolkata. A team from the Railways had visited the Jessop premises in Dum Dum earlier this year. Indian Railways is a client of Jessop.
“Ruia is flouting a court order by not properly securing the factory’s perimeter. More than 70 places in the boundary wall are broken,” said a CID officer on raid.
Ruia, his family and associates are the owners of Jessop but neither he nor his family members hold any position in it. They control Jessop through a maze of overseas companies. The Ruia Group has so far maintained that it has no control over the factory assets.
In 2003, the Ruia Group led by Pawan Ruia had acquired Jessop & Co which manufactured railway wagons. In 2014, the factory had shut down indefinitely and in February this year Chief Minister Mamata Banerjee announced that the Bengal government would take over Ruia Group’s Dunlop India and Jessop & Co. “He had a leading role in the Jessop conspiracy. He has to take the responsibility of those theft incidents in the factory. He will be grilled,” said the CID officer.
The officer also added that Jessop is Ruia’s own factory which he deliberately tried to canvas as ailing. He bought this factory at a relatively cheap market price, and spent around Rs 800 crore. But he tried to sell the machineries and land of the factory. Moreover, he never tried to run the factory to make huge amounts of money. It was his tricks to eye-wash the employees promising rejuvenation of Jessop.
“The regular thefts in the factory and sudden fire incidents were plotted by Ruia himself. The fire incidents helped him to destroy important evidence against him and audit reports, the forensic experts told us. He sold the railway materials too in open markets,” the officer further added.
Pawan Ruia is often referred to as the ‘turnaround tycoon’. But his efforts seem to have failed with Jessop, though the company claims that the Ruia Group did manage to successfully run Jessop from 2003 till 2012.