Last Updated on Jun 25, 2021 by Manonmayi

The greed for money led to India’s biggest stock market scam of 1992 when Harshad Mehta, also known as the Big Bull of Dalal Street, deceived the entire nation of Rs 4,000 cr. Here are 10 facts about him.

This article covers:

Fact No. 1: Came to Mumbai dirt poor

Born in a lower-middle-class family, in Paneli Moti, Rajkot, Harshad Mehta came to Mumbai in search of a living. At the time, the Big Bull of Dalal street had only Rs 40 in his pockets. To survive in the city of dreams, he took meagre jobs for the next 8 yrs.

Fact No. 2: Became the “Big B” of the stock market

By the 1990s, Harshad Mehta had risen to such prominence in the share market with his relentless hard work and unwavering will, that he earned the title ‘Amitabh Bachchan of the stock market’.

Fact No. 3: The most treasured man of the Income Tax department

In 1992, Harshad Mehta paid the highest income tax of Rs 24 cr, just a few weeks before the scam was exposed. In fact, some said that if he was alive and not caught, Harshad Mehta would have been richer than Mr Mukesh Ambani.

Fact No. 4: Lived life king size

He owned a 12,000 sq. ft. lavish penthouse in Worli and a fleet of rare, luxurious cars like the Lexus Starlet and Toyota Corolla. Many people only dreamt of owning these in the 1990s.

Fact No. 5: Orchestrated India’s biggest scam ever

Between April 1991 and 1992, Mehta manipulated Sensex in a way that it surged from just over 1,000 points to almost 4,500 points. This resulted in a huge scam of Rs 4,000 cr, which made it the biggest in India that was planned just by a single person. When adjusted for inflation, the scam would amount to Rs 24,000 cr.

Fact No. 6: Got a staggering surge in market value

In this scam, Rs 3,500 cr of funds from the banks were diverted to a group of stockbrokers, led by Harshad Mehta. These funds were then put into selective stocks, causing them to surge over a staggering 4,500 per cent.

Fact No. 7: The biggest stock market scam exposed

Journalist Sucheta Dalal exposed the scam on 23rd Apr 1992 in the columns of the Times of India. Based on the scam, she co-wrote a book titled “The Scam: Who Won, Who Lost, Who Got Away” with Debashish Basu.

Fact No. 8: Poor banking system

Thanks to the scandal, loopholes in the Indian banking system and the Bombay Stock Exchange (BSE) transaction system were exposed. Watchdog SEBI further introduced new rules to address the loopholes. Mehta was on trial for 9 yrs until he passed away in late 2001 due to a cardiac arrest in Tihar jail.

Fact No. 9: Allegation against Prime Minister

On 16th Jun 1993, when Mehta was out on bail, he publicly claimed that he had bribed the then Congress President and Prime Minister Mr P. V. Narasimha Rao of Rs 1 cr for getting Mehta out of the scandal case.

Fact No. 10: Case magnitude

The CBI charged Mehta with 72 criminal cases, which included bribery, cheating, forgery, criminal conspiracy and falsification of accounts. He was also charged with over 600 civil action suits by banks and institutions regarding the money he owed them. Mehta had fooled 4 banks of an amount of Rs 1,700 cr.

15 Comments

  1. This is the irony that when a small be it Narender Modi be it Adani or Harshad Mehta anyone of he goes up fast then beggies have problems

  2. Man with vision, passion, dedication and conviction… Man of decade .. created history… iam a big fan … the good thing about him is he never hide his wealth, lived king size …

  3. Harshad Mehta was just too brilliant to utilise the banking loophole…He wasn’t the scamster..

  4. Unnikrishnan Nair

    Mehta was an intelligent man but lacked wisdom thoughts. He was intelligent but not wise.

  5. Harshad Mehta was Good man , anyways what he did what he felt in that situation…..there is no meanings to discuss that part here after all Prime minister of India took the brided it means Harshad is not solely responsible to make this possible ….why the SBI,PNB, and other Gov banks offered him to diversify free park fund in Money market and stocks market ?

    If there was no rules it means that was the system loophole then in the first case system was responsible including all the Government officials …

    In our livelihood we offer bribe to many ones right? The same way he did , that was Harshads style to do ….

    Anyways I never hold him responsible for that scandal and I never convinced as that was a scandal …

    And even Suchita Dalal and her reporting agency admitted that it wasnt the scandale , that was system loophole, but as cognizant/responsible citizen he shouldn’t have had taken that advantage therefore he should have had put that suggest in the discussion to bring the change in the system…

    And If I am not wrong many class of actions being invoked by the many investors ….

    Just kind request we all know who was he so don’t spred false information …

    Thanks,

  6. DEVPRIYO BHATTACHARYA

    Was he alone in doing so? Answer is NO. He exploited the loopholes. Correct. But he bribed govt officials. You have not mentioned the crime committed by govt officials. This is Bad. This fact check just one side of the story. NO USE. BIASED ARTICLE. HAVE THE COURAGE TO BLAME GOVT OFFICIALS.

    • I like this blog, and I like to add that loopholes of banks and other financial institutions are lead to human to find out the short cut for success. So it’s not only Harshad bhai scam it’s about the whole the system responsible for it. Institute and Govt. needs to be look into this….Scam also going on after Harshad bhai….but he never run aways from all this devil as he knows that He was just spent money illigally and forget all the necessary rules.
      Anyways Govt. Must take actions against currupted Persons or Company as soon as earliest before they gone away from Country..

    • All Gujarati are smarter to make a money but some of them are choose short cut to become a billionaire…As A Gujarati I pledge I never run away from any suitation occurred during my Carrie.. Honesty in my blood. HARSHIL KUMAR