The Andhra Pradesh CID has arrested the ex-chief of Satyam Computers Ramalinga Raju and his brother Rama Raju after they gave themselves up at the officce of the director general of police at Hyderabad.
They were interrogated for three hours.
The interrogation was reportedly focussed on whether anyone else in the board of directors was aware of this fraud and since when he has been fudging the company's accounts.
Raju was reported to have been calm throughout the interrogation.
Yesterday SEBI had served summons on Ramalinga Raju and his lawyer had said that he would appear before SEBI officials at 4 pm today. Following the arrest, the SEBI team is now likely to question him while he is in CID custody on Monday.
Three days ago, Raju, Satyam's founder and chairman had resigned from the company after confessing to one of India's biggest accounting frauds.
The arrests came hours after the government superded Satyam's board of directors and said it would nominate 10 nominees to the board. (See: Government nominees to replace Satyam board)
With the dissolution of the board, Satyam's board meeting scheduled for today now stands cancelled and the new board will meet within seven days to take a decision on a new management team.
"The current board ceases to exist and there would not be any meeting tomorrow,'' corporate affairs minister Prem Chand Gupta said in a release, adding, ''the new board will meet in the next seven days."
Deepak Parekh, chairman, HDFC, confirmed that he would not be part of the Satyam board. He suggests having members of NASSCOM, other It and telecom bodies and institution such as LIC as part of the board.
Raju's lawyer says after his late night arrest, a bail application will be moved on behalf of the brothers.
"Andhra Pradesh CID had summoned Ramalinga Raju and Rama Raju, his brother, last evening. Following which Raju made himself available before the Andhra Pradesh Police, after which he was arrested. Interrogation went on for three hours. Ramalinga Raju is suffering from high blood pressure so a doctor was called in. He was treated and now he is alright. We will certainly move a bail application in the appropriate cases," said Bharat Kumar, advocate of Ramalinga Raju.
A case has been registered against Ramalinga Raju and Rama Raju and others under Section 120B (criminal conspiracy), 420 (cheating), 406, 467 and 427 (criminal breach of trust, forgery and using forged documents as genuine).
The CID was trying to collect evidence that can be produced before the court while seeking their custody later in the day. Since the courts are closed on account of it being a Saturday, the accused may be produced before a magistrate at his residence.
Ramalinga Raju is a diabetic and has high blood pressure, his lawyer may request the magistrate to order police to render necessary medical assistance by admitting him to a hospital.