Hyderabad: A court granted bail to former chairman and founder of outsourcer Satyam Computer Services in a case of accounting fraud that turned out to be India`s biggest corporate scandal.
Ramalinga Raju, a management graduate from Ohio University who founded Satyam in 1987, shocked investors in January 2009 when he said the firm`s profits had been overstated for years and assets falsified in a fraud allegedly worth over $1.5 billion.
Raju had been in police custody since the revelation of the fraud. A court in Hyderabad, where Satyam is headquartered, granted the bail on Wednesday.
"He has been cooperating with the investigation, he has been cooperating with the trial, and he will do so without exception and without any concession," Raju`s lawyer Bharat Kumar told reporters outside the court.
Kumar said he could not immediately comment on the grounds for the bail as he was yet to receive a court judgement copy, but local television channels said Raju was granted bail on medical grounds.
"The important grounds are that this is a long incarceration as an under-trial prisoner," Kumar said. "My client himself surrendered before the police and he cooperated all through with the investigating agencies and his health is also not good."
The Central Bureau of Investigation (CBI), which has been investigating the case, will appeal to the apex court after studying the order, VV Lakshmi Narayana, a Hyderabad-based senior official with the CBI, told Reuters.
In April last year, the bureau had said it had filed charges against nine people for alleged involvement in fraud at the outsourcing firm. The charges include criminal conspiracy, cheating, forgery and falsification of accounts.
Five former Satyam officials were also granted bail in July. Those included former managing director B. Rama Raju and former finance chief Vadlamani Srinivas.
Satyam was sold to IT firm Tech Mahindra, majority-owned by automaker Mahindra & Mahindra and partly owned by British telecoms operator BT Plc, in an auction in April last year.
It was subsequently renamed Mahindra Satyam, which is also listed in New York. The firm counts General Electric Co, Citigroup, Cisco Systems and GlaxoSmithKline among its clients.
Shares in Mahindra Satyam ended 0.5 percent lower at 84.95 rupees and Tech Mahindra closed little changed at 714.70 rupees in the main Mumbai market that rose 1.2 percent.