Fortis Healthcare has approached the Supreme Court to challenge a recent Delhi High Court order directing a forensic audit into transactions involving the company, Malaysia-based IHH Healthcare Berhad, and RHT Health Trust. The appeal seeks to set aside the High Court's decision, while Axis Bank is also expected to file a similar challenge.
The dispute arises from the long-running Daiichi Sankyo–Fortis litigation, which concerns the enforcement of an arbitration award against former Fortis promoters Malvinder and Shivinder Singh. The Delhi High Court ordered the forensic audit to reconstruct the movement of shares and financial transactions, examining whether assets were dissipated in violation of earlier court orders.
Why was a forensic audit ordered?
The High Court appointed an independent forensic auditor to trace the complete chain of transactions related to Fortis Healthcare shares after 2016. The audit is intended to examine share transfers, pledges, invocation of securities, open-market sales, and related financial dealings involving multiple banks and financial institutions.
Importantly, the order does not amount to a finding of wrongdoing. The forensic audit is an investigative exercise designed to assist the court in determining whether judicial assurances regarding assets were undermined through subsequent transactions.
Why the appeal matters?
Fortis argues that the audit could have significant implications for the company and its stakeholders despite the change in ownership that occurred through IHH Healthcare's 2018 acquisition. The Supreme Court's decision on whether to stay or modify the audit order may influence how courts balance enforcement of historic liabilities with the rights of current shareholders and financial institutions.
The case is being closely watched by the healthcare, banking, and corporate governance sectors because it may shape future judicial approaches to forensic investigations involving complex shareholding structures and legacy promoter disputes.