The Supreme Court on Monday quashed a petition filed by financial industry magnate Nimesh Kampani to stop proceeding initiated against him in the Nagarjuna Finance Corp case, thus clearing the way for his arrest.
The Supreme Court bench headed by Justice Altamas Kabir, however, allowed Kampani to seek anticipatory bail.
The apex court had on April 2 stayed the arrest of investment banker Kampani.
Nagarjuna Finance, the Hyderabad-based non-banking finance company has been charged with defaulting on repayment of deposits worth Rs 100 crore (Rs 1 billion).
Kampani was a director of Nagarjuna Finance when the alleged default took place. He had resigned as a non-executive director in 1999. He was, however, on the board when the NBFC raised deposits from the public.
Police arrested Nagarjuna Finance chairman K S Raju, and PK Madhav, former director of Nagarjuna Finance and the then Maytas Infra CEO, on December 15.
Both were arrested under Section 5 of the Andhra Pradesh Protection of Depositors of Financial Establishments Act and also under Sections 420 and 406 of the Indian Penal Code.
Another director, GS Raju, was arrested early this year.
KS Raju was a promoter of Nagarjuna Finance before he divested his holding in favour of a Mumbai-based company, Mahalakshmi Factoring Services, in September 2000.
Kampani, however, had earlier told APO police that he was in no way involved with the matter, having resigned as a non-executive director in 1999.