An official familiar with the report said that the MCA has found that the actions of the firms were violative of sections 447, 448 and 449 of the Companies Act.
Mar 29, 2019, 09.00 AM IST
The MCA probe focused on a number of investments in Deepak Kochhar companies.
The Mumbai regional office of Ministry of Corporate Affairs (MCA) has recommended prosecution action against companies owned by
, the husband of former
, and Videocon chairman VN Dhoot. This, after the department found instances of what an internal report describes as deliberate acts of omission and concealment of facts. The report clams that some financial statements and certificate were false or omitted certain material facts.
An official familiar with the report said that the MCA has found that the actions of the firms were violative of sections 447, 448 and 449 of the Companies Act, which basically deal with punishment of fraud. “Irregularities were observed in the conduct of board meeting. In some of the financial statements and annual reports submitted the disclosures were inadequate or misleading. Some members of the board were suspected to be shadow directors, all these amount of prosecution under certain sections of the Companies Act and the same has been recommended,” said the official to ET. He was referring to alleged action of Deepak Kochhar’s companies as well as Videocon.
Any prosecution, if that were to happen, could be carried out by the Serious Frauds Investigation Office (SFIO). A final decision will be taken by the parent ministry in Delhi. During the probe, MCA’s Mumbai office recorded the statement of the former MD & CEO of ICICI Bank, Chanda Kochhar. The sources cited say that Chanda Kochhar denied any knowledge of the affairs of her husband’s company. Adopting the same line of defence as when she was questioned by the Enforcement Directorate (ED) (probing her role in a alleged money laundering case), Chanda Kochhar told the MCA that the decision to grant the loans to the two companies was taken by the bank’s sanctioning committee and wasn’t her individual decision.
The MCA probe focused on a number of investments in Deepak Kochhar companies. These investments are at the heart of probes by multiple agencies. “The probe into the affairs of the companies owned by Kochhar and Dhoot have been divided into six heads. While the report on the first leg is completed and submitted, work on the second leg has began,”said the above cited official. “ In the first leg of the probe we have found that Kochhar’s company NuPower Renewable pvt ltd (NRPL) received two major loans. While the loan from Dhoot’s company was received in one tranche, loans from companies owned by Kanodia came in intervals. These monies weren’t used for any genuine business purposes and looks to us as a case of accommodative lending. We have therefore recommended prosecution against firms owned by Kochhar and Dhoot,”added the official.
Earlier while speaking to ET on the issue, Dhoot said that only some minor, technical irregularities had been found. “They have not found any irregularity as regard to the Companies Act sections, which carries compulsory prosecution, so there is no question of prosecution,” Dhoot told ET in a text message.
Messages and calls made to Kanodia did not elicit a response. Other than Chanda, the MCA has also recorded statements of Deepak Kochhar and Dhoot. According to sources, Deepak said that his firm was engaged in businesses with entities owned by Videocon and others, but that his wife had nothing to do with the affair of his company. “ While our mandate is not to probe quid pro quo as that is being probed by the ED and the Central Bureau of Investigation, our probe is to look into the affairs of the companies, we have questioned both the husband the wife as the fund flow looks suspicious and the monies have come to his firms around the time ICICI sanctioned loans. The statements of the couple has been unsatisfactory and the same has been concluded in the report,” added the official.
ED TO SEND LRS
In a related development, ED probing money laundering case against Kochhars and Dhoot is in the process of sending letters rogatory (LRs) to Singapore and Hong Kong seeking details of Kocchar’s bank accounts. LRs are a formal request mechanism from a court to a foreign court for judicial assistance
ED summons Chanda, Deepak Kochhar and VN Dhoot in ICICI-Videocon loan case
No conflict of interest: Deepak Kochhar
Corporate Affairs Ministry summons Deepak Kochhar in ICICI Bank controversy
Videocon row: Tax department sends second notice to Deepak Kochhar
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