Delhi court greenlights audit into Singh brothers' Fortis stake

It imposed no liability, penalty, or fine on IHH or Fortis.

The Delhi High Court has ordered the appointment of a forensic auditor to investigate the dissipation of Fortis Healthcare shares once held by Malvinder Mohan Singh and Shivinder Mohan Singh.

The dispute traces back to Daiichi Sankyo's arbitration award against the Singh Brothers, who were Fortis' erstwhile promoters before IHH Healthcare took control of the company through Northern TK Venture Pte. Ltd.

The forensic auditor's mandate covers three areas, including the dissipation of the Singh Brothers' shareholding in Fortis, the subsequent change in control of the company, and the role of relevant stakeholders.

The order also directs examination of the transaction through which IHH Healthcare Berhad acquired its controlling stake in Fortis via Northern TK Venture Pte. Ltd.

The Court imposed no liability, penalty, or fine on IHH or Fortis. Both companies say they were neither party to the original dispute nor judgment debtors in the underlying execution proceedings.

This stems from a Supreme Court of India judgment issued 22-23 September 2022, in Daiichi Sankyo's long-running case against the Singh Brothers.

Fortis, in a separate filing with India's National Stock Exchange and BSE, characterised the forensic audit as "purely investigative in nature" and said it does not, by itself, result in any determination of liability against the company.

Both IHH and Fortis said they are reviewing the order with legal counsel and will evaluate next steps in accordance with applicable law.