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2018, when India Inc poster boys turn rogue

Monday, December 24, 2018
By Rajkumar Leishemba

As the adage goes, there is a black sheep in every flock but India Inc found out, much to its embarrassment, this year that it had quite a few who were not playing by the rule book.

When diamantaire uncle-nephew duo Mehul Choksi and Nirav Modi emerged as kingpins in the Rs 14,000-crore Punjab National Bank fraud upstaging Vijay Mallya, wanted in India for Rs 9,000-crore bank loan default, it was inevitable that the year belonged to the black sheeps of corporate India when it came to hitting the headlines.

Once the poster boys of the spirit of Indian entrepreneurship, the flamboyant Mallya, Choksi and Modi also became convenient tools to be used by political parties ruling and the Opposition alike to score brownie points over each other. Giving them company were the absconding promoters of Gujarat-based pharmaceutical company Sterling Biotech Group Nitin and Chetan Sandesara, wanted in connection with a Rs 5,000-crore bank fraud and money laundering case.

While a London court has ordered for Mallya's extradition to India at the end of a year-long trial although he intends to appeal against the order, it remains to be seen in the coming year how many of the corporate-honchos-turned-fugitives will actually be brought back to India to face the law of the land.

2018 was also the year when the Singh brothers, former Fortis and Ranbaxy promoters and the erstwhile young icons of healthcare industry, fell out and literally coming to blows accusing each other of assault besides blaming each other for the downfall of their business.

Malvinder and Shivinder are also facing a criminal complaint filed by the another firm they promoted, Religare Enterprises with the the Economic Offences Wing of the Delhi Police for cheating, fraud and misappropriation of funds to the tune of Rs 740 crore.

The saga of Tata-Mistry fight continued, moving from the Mumbai bench of NCLT to the NCLAT in the national capital as ousted Tata Sons Chairman Cyrus Mistry sought to slug it out, persisting with his allegations of oppression of minority shareholders and mismanagement by the company.

On the other hand, the National Company Law Tribunal (NCLT) witnessed heightened activities at its different benches took up insolvency proceedings of 12 stressed assets which were referred to it by the RBI last year.

While Tata Steel acquired debt-laden Bhushan Steel Ltd with a Rs 32,500-crore deal and Aditya Birla group firm UltraTech Cement bagging Binani Cement with a revised bid of Rs 7,950.34 crore, the proceedings had to reach all the way to the Supreme Court to decide the winner, thus exposing lacunae in the Insolvency and Bankruptcy Code (IBC).

In the case of auto component maker Amtek Auto, Liberty House won the bid offering to pay financial creditors Rs 3,225 crore upfront and make a fresh infusion of Rs 500 but lenders approached the Chandigarh bench of NCLT alleging failure on the part of the UK-based firm to comply with approved resolution plan.

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