Krishna Damani, administrator and treasurer of South Point School and South Point High School, was arrested on Thursday from outside his Dalhousie office for allegedly siphoning off around Rs 10 crore from school funds.
Kolkata police’s joint commissioner Waquar Raza said Damani was arrested based on a complaint that necessitated an investigation.
“A preliminary investigation revealed that money from the school was being siphoned off through a company that provided logistics like manpower to the school at an apparently inflated rate compared with the market prices. This company is owned by relatives of Krishna Damani,” said joint commissioner (organisation) Raza, who is also functioning as joint commissioner (crime).
South Point
The police said a case had been started under IPC sections related to criminal breach of trust; criminal breach of trust by clerk or servant; criminal breach of trust by public servant or by banker, merchant or agent; cheating and dishonestly inducing delivery of property; forgery of valuable security; falsification of accounts, and criminal conspiracy.
If convicted, Damani could be sent to jail for up to 10 years.
Other than Damani, the complaint names three persons — a former employee of South Point Education Society (SPES), a senior financial officer of SPES and a trustee of SPES.
A senior police officer said several persons have already been examined in connection with the case and several others are yet to be questioned. “Many documents have been seized in the past year based on which the arrest has been made,” the officer said.
Law firm Fox and Mandal issued a statement on behalf of the MP Birla Group, of which the South Point Education Society is a part, mentioning that a company engaged by SPES and run by Damani’s relatives was allegedly instrumental in siphoning off funds.
“Scrutiny of the bank statements of Global Staffing Services and Pastille Mercantile showed that money was paid out of South Point School and South Point High School and received in the bank account of Global Staffing Services (which is a division of Pastille Mercantile).... Pastille Mercantile is owned and governed by two directors — Manju Damani and Jaya Damani — who are, respectively, the mother and wife of Krishna Damani,” the statement reads.
A statement issued by the MP Birla Group, whose chairman is Harsh Vardhan Lodha, mentioned that Damani was arrested “in connection with a criminal complaint registered for defalcation of funds, falsification of documents and misuse of office for personal gains. These grave offences which appear to have been committed in collusion with others were unearthed through a threadbare investigation conducted by the MP Birla Group”.
“The MP Birla Group assures all stakeholders, including students and staff members, that the operations of the school are not going to be disrupted by the ongoing investigation. We commit to extend full co-operation to the state administration to make sure that all accomplices
of the prime accused, within and outside the school and SPES, face the full force of the law....”
A statement issued on behalf of South Point School & South Point High School, run and managed by South Point Education Society, whose Governing Council is presided over by Justice Kalpesh S. Jhaveri (former Chief Justice of Orissa High Court), denied the allegations against Damani and said the complaint against him was “frivolous and false”.
The statement says: “In the morning at about 11.30am, one of our esteemed Trustees, Mr Krishna Damani, was detained by Kolkata Police. On protracted enquiries, we understand that such detention by the police was on the basis of a frivolous and false complaint filed by Indranil Choudhury, one of the close associates of Mr Harsh Vardhan Lodha sometime in 2023. The complaint is manifestly motivated with intent to defame and harass the Trustees of our School and to generally demoralise the management, senior staff, teachers as well as our students. Such complaint appears to be handiwork of a conspiracy hatched by and on behest of Mr. Harsh Vardhan Lodha...”
“The entire South Point fraternity deprecates andcondemns such act and conduct. Appropriate legal steps are being taken to protect the interest of the Trustees, officers, teachers and otherstaff members and ensure that the perpetuators of false propaganda and complaint are brought to justice through laws of our land....” the statement says.
The police said they received a complaint in February 2023 from Choudhury, a chartered accountant, on behalf of Lodha, chairman of the MP Birla Group and trustee of South Point Education Society, following which the probe was launched.
An officer said the voluminous complaint, which had details of the transactions of the company owned by Damani’s family members, also mentioned: “Krishna Damani and others associated with him have amassed wealth of more than Rs 20 crore already by diverting funds from South Point Education Society.”
The case was started on the basis of an order in April 2023 of the chief metropolitan magistrate, Kolkata, under Section 156(3) CrPC, the police said.
