TaxTMI 
TaxTMI 
2019 (1) TMI 1575
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....ant Upadhyay a/w Mr. Nirav Parmar, i/b K. Ashar & Co for SEBI For the Respondents : Mr. Karl Tamboly a/w Devesh Juvekar, Rishabh Jaisani, Pooja Vasandani i/b Mr. Arun Sane, Ms. Ekta Tyagi, Mr. Naclsher Kohli, i/b DSK Legal, Mr. Malhar Satakia a/w Kamal Shankar, Atul Menon i/b BSR Associates LLP, Mr. Krishnava Dutt, i/b Argus Partners for Keki Mistry (Non Executive Director), Mr. Swapnil Gupte, i/b Argus Partners for Harish Engineer (Non Executive Director), Mr. Mustafa Doctor a/w Anugrah Robin Frey & Akriti Shika, i/b L & L Partners for Deloitte Haskins & Sells, Mr. Mangesh Sawant, Mr. Venkatesh Dhond a/w Prateek Mishra i/b L & L Partners for SRBC & Co LLP, Mr. Krishnava Dutt, i/b Argus Partners, Ms. Pooja Pandey, Mr. Gamonjit Singh Seth....
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....f ICAI and the report of SFIO. Section 130 of the Companies Act reads as below: (1) A company shall not re-open its books of account and not recast its financial statements, unless an application in this regard is made by the Central Government, the Income Tax Authorities, the Securities and Exchange Board, any other statutory regulatory body or authority or any person concerned and an order is made by a court of competent jurisdiction or the Tribunal to the effect that- (i) the relevant earlier accounts were prepared in a fraudulent manner; or (ii) the affairs of the company were mismanaged during the relevant period, casting a doubt on the reliability of financial statements: Provided that the court ....
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....financial statements of to R1 and R3, which are the listed companies, are re-opened and recasted. R3 in the main Company Petition has filed written objection wherein it is stated that an order permitting re-opening of the books of account and re-casting thereof including financial statements of R1 to R3 for the past five years can be passed in a condition when Tribunal comes to the conclusion that the accounts of relevant years were earlier prepared fraudulently; or that the affairs of R1 to R3 were mismanaged during the relevant period, casting a doubt on the reliability of the financial statements. It is further contended on behalf of R3 that the main Company petition is still pending and if any order is passed in this company petit....
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....ng the accounts. Normally accounts of the companies are prepared by the company and audit is done by the auditors. Ld. Counsel appearing on behalf of the erstwhile directors has also opposed the application on the ground that no such order under Section 130 of the Companies Act, 2013 can be passed at this stage without forming an opinion that accounts were being prepared in a fraudulent manner, and at this stage, enquiry/investigation is still pending. Therefore order under Section 130 cannot be passed. We have heard the argument of the Director (P&L) and arguments advanced by the Ld. Sr. Counsels appearing on behalf of the auditors and other Counsels appearing on behalf of erstwhile Directors and perused the records. On bare reading ....
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....ity concerns existed on the balance sheet date. However, no such concerns were reported in the Audit report." In the SFIO Report , para 225.12, it is stated that "in nutshell, the above findings highlight the fraudulent and irresponsible conduct of key managerial & executive personnel of IL&FS Limited in using EWT as a vehicle for their personal enrichment, after the fifth supplemental indenture." Further, it is reported in SFIO report that "it is clear that all the distributions made by the EWT were fraudulent to enrich few employees/managerial personnel." It is further reported that "EWT trust which was primarily meant for welfare of needy employees was thus used as a conduct to give shape to fraudulent motives of the key manager....
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.... stage. In the circumstances, we allow this petition filed under Section 130 of the Companies Act, 2013 for re-opening the books of accounts and recasting the financial statements of Infrastructure Leasing & Financial Services Limited (R1), IL&FS Financial Services Limited (R2) and IL&FS Transportation Networks Limited (R3) for the past five financial years , viz. from Financial Year 2012-13 to Financial Year 2017-2018. We further issue directions to Central Government to appoint such person/firm as the Chartered Accountants to recast the accounts/financial statements of all the three companies, i.e. Infrastructure Leasing & Financial Services Limited (R1), IL&FS Financial Services Limited (R2) and IL&FS Transportation Networks Limite....