ED Summons Arvind Datar in Saluja ESOP Investigation
The Enforcement Directorate (ED) has summoned Senior Advocate Arvind Datar as part of its ongoing probe into the ESOPs (Employee Stock Options) granted to Rashmi Saluja by Care Health Insurance.
This summons marks a significant development in the larger investigation involving Religare Enterprises and its former leadership.
Why the ED Is Investigating Datar
The ED is examining whether Datar’s legal opinion played a role in approving the ESOPs awarded to Saluja. At that time, she served as the Executive Chairperson of Religare Enterprises.
Despite her leadership role at Religare, she received stock options from Care Health. This raised serious questions about a potential conflict of interest.
Legal Advice Under Spotlight
Arvind Datar, a senior legal expert in corporate law, had advised Care Health on the legality of granting ESOPs to Saluja.
The ED suspects that this advice may have facilitated personal financial gains for Saluja. If proven, the agency could label this as a governance failure involving both corporate leadership and legal consultants.
What’s at Stake
Religare and Care Health share deep corporate ties. Therefore, decisions in one company directly impact the other.
The decision to grant ESOPs to Saluja has triggered multiple concerns:
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Did the move follow fair procedures?
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Were internal approvals valid?
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Was the legal advice impartial?
These are the key issues now under examination.
Legal Experts React
Many lawyers have expressed concern over this move. Summoning a senior advocate for professional advice is uncommon.
Some argue this could discourage transparent legal consultations in the future. However, others believe that all parties involved in suspect deals—executives, advisors, and boards—must be held responsible.
Implications for Corporate Governance
This case could have wide-ranging consequences for corporate India. If the ED finds wrongdoing:
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Legal opinions will face increased scrutiny.
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Companies may tighten internal policies regarding ESOPs and board benefits.
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Boards might become more cautious before approving executive incentives.
Next Steps in the Probe
The ED will now review:
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Datar’s legal note
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Company board discussions
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Internal approvals, emails, and meeting records
Officials plan to submit key findings later this month. The probe will determine whether the ESOP grant violated laws or best practices.