TaxTMI 
TaxTMI 
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2025 (11) TMI 15
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....ajaj, Advocate for the petitioner(s) in CRM-M-14813-2022. Mr. J.S. Lalli, Dy. Solicitor General of India with Mr. Manish Verma, Advocate, for the respondent, SFIO, in CRM-M-19815, 19764, 19913-2025. Ms. Puneeta Sethi, Sr. Panel Counsel with Mr. Yashoodev S. Thakur, Advocate for respondent-SFIO in CRM-M-14813, 22108, 22109, 18396, 18661-2022. Mr. Shalender Kashyap, Advocate and, Mr. Parchand Sethi, Advocate, for Union Bank of India/Corporation Bank in CRM-M-19815-2025. Mr. Gaurav Goel and Mr. Teginder Singh, Advocate, for respondents no.4, 10, 12-BOI, IOB, CBOI in CRM-M-19815-2025. Mr. Rahish Pahwa, Advocate, for respondent-Canara Bank in CRM-M-19815-2025. Mr. Kunal Dawar, Adv. for respondent no. 14 in CRM-M-19815-2025. Mr. Arvind Rajotia, Advocate, for respondent no. 15-PNB in CRM-M-19815-2025 Mr. C.S. Pasricha, Advocate and Mr. Saurabh Sudhir, Advocate for the respondent, Karnataka Bank in CRM-M-19815-2025. Mr. Rahul Garg, Advocate for respondent nos. 3, 5 to 7-SBI in CRM-M-19815-2025. Mr. Sumit Batra, Advocate for respondent-LIC Housing Fin. Mr. Arvind Rajotia, Advocate for respondent-PNB. Mr. Sharik Minhas, Advocate for KPS Dhillon, Advocate for res....
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....gla, and Sushil Singla. It is revealed that the persons above were the actual controlling "mind and will" and were in control of the affairs of the SRS Group. The degree of their control was such that the directors in these companies were appointed or removed at their whim and fancy. 6. That in view of the revelations based on the investigation conducted by the Respondent/SFIO, the following offences have been invoked in the criminal complaint in accordance with the role/period of involvement of each of the accused: a) False statement in balance sheets/books of SRS group of companies: Offences invoked against signatories/Directors to the balance sheets - Section 448 of the Act and/or Section 628 of the Companies Act, 1956. b) Fraudulent representation before banks for obtaining credit facilities: Offences invoked against loan taking companies and the controllers of the said companies who submitted falsified balance sheets signatories/directors to the balance sheets - Section 36(c) of the Act. c) Siphoning and diversion of funds received as loan from banks/financial institutions: Offences invoked against respective companies and the individuals involved....
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....6-17), SRS Learn & Knowledge Ltd (2016-17), Latest IT solutions Pvt. Ltd (2015-2016, 2016-17), SRS Knowledge & Technologies Pvt. Ltd ( 2015-16 and 2016-17) Top choice Computech Ltd ( 2015-16), SRS Automotive Components Pvt. Ltd. (2015-16 and 2016-17), SRS Mines Overseas Ltd (2015-16, 2016-17) and SRS Modern Sales Ltd (2015-16). 11. The allegations against the accused A-80 Naresh Kumar [CRM-M 22108-2022] are that the investigation revealed that Naresh Kumar/petitioner, being the Statutory Auditor, audited the financials of SRS Limited (2016-17 & 2017-18) & SRS Real Estate Limited (2016-17), which were either false in any material particulars, knowing it to be false and/or omitted material facts, knowing it to be material. 12. The allegations against the accused A-76 Pankaj Kumar Bansal [CRM-M 22109-2022] are that investigation revealed that Pankaj Kumar Bansal/petitioner, being the Statutory Auditor, audited the financials of SRS Finance Limited (2015-16 & 2016-17) SRS Real Infrastructure Limited (2015-16, 2016-17 and 2017-18), SRS Entertainment India Ltd (2016-17) and SRS Limited (2016-17, 2017-18), which were either false in any material particulars, knowing it to be false a....
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.... 18. The facts relevant to the adjudication of the bail applications filed by Chartered Accountants are being referred TO from the complaint and other documents attached to all the files mentioned above. Additionally, the replies, including the reply filed by the State Bank of India, which headed the consortium of lending banks, are also being considered. 19. The petitioners' counsel seek bail primarily on the ground that, before the filing of the complaint, none of the accused was arrested and, as such, the investigator never intended to arrest them, and now, they are throwing the burden on the trial Court and the Courts to arrest them, which is not justifiable. It was further argued that the trial Court did not issue warrants but instead issued a summons, which further shows that the Court's intention was not to deny bail. 20. On the contrary, the counsel appearing for SFIO opposes the bail(s) and submits that the grounds for bail and the parameters for the bail are akin to Section 45 of the PMLA Act, Section 37 of the NDPS Act and Section 20 of UAPA, and before this Court can grant bail, there should be subjective satisfaction that all the accused are not prima fa....
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....rofessionals under the law and ethical code. 25. It will be appropriate to refer to the relevant extract of the reply dated 17.07.2025 filed by SFIO, as under:- (4). That despite being aware of the proceedings pending before the ld. Special Court, the petitioner did not appear in person before the ld. Special Court, consequently, the ld. Special Court, vide order dated 23.11.2021 & 11.03.2022 directed issuance of bailable warrants and non-bailable warrants respectively against the petitioner herein. (5). That pursuant to the issuance of the warrants of arrest as above, the petitioner herein approached the ld. Special Court seeking recall of the warrant issued against him, wherein, the ld. Special Court, vide order dated 30.03.2022, dismissed the application filed by the petitioner seeking recalling of the abovesaid warrants of arrest and also declined the prayer to supply complete set of relied upon documents to the Counsel for the petitioner. (12). That the investigation into the affairs of eighty-eight companies of SRS group revealed that SRS Group consisted of two categories of companies with the nomenclature 'SRS companies' and 'non-SRS companies'.....
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....de its order dated 10.06.2021, issued 'directions' to the SFIO to file and initiate prosecution against the persons identified in the investigation report including against the petitioner herein. (14). That, accordingly, the criminal complaint under reference i.e., COMA-17-2021 along with one another complaint i.e., COMA-18-2021, were filed before ld. Special Court (Companies Act), and the petitioner herein has been arrayed as amongst the accused in COMA-17-2021 only. Copy of the criminal complaint bearing No. COMA-17-2021 has been annexed along with the petition as Annexure P-1. (15). That the ld. Special Court, vide cognizance order dated 16.08.2021, was pleased to take cognizance of all the offences as mentioned in the said complaint. Further, as far as the petitioner herein is concerned, the ld. Special Court, has summoned the petitioner herein for the offences as under:- COMA 17 of 2021 * u/s 143 r/w 147, 448 of the Companies Act, 2013; * u/s 227 r/w 233, 628 of the Companies Act, 1956. Copy of the cognizance order dated 16.08.2021 passed in COMA-17-2021 has been annexed along with the petition as Annexure P-2. (17). That w....
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....any circular trading. xx xx xx xx xx f) It is respectfully submitted that in the Second modus operandi, SRS Modern Sales Limited had shown purchases from one set of SRS Group companies and sale to another set of SRS Group companies either on the same day or within a couple of days, By adopting this modus operandi, the goods sold by SRS Modern Sales Limited were again re-purchased at a much lower price than the sale price on the same day or next couple of days. This circular trading helped SRS Modern Sales Ltd. in inflating the net worth of the company and to show enhanced sale/purchase and profits in SRS Modern Sales Limited. The following table illustrates the same:- xx xx xx xx xx g) It is respectfully submitted that, the total purchase of jewellery made by the SRS Group (consisting of SRS Companies and non-SRS Companies) from the other sources (companies/entities, Bank and Import) excluding the SRS Group from the year 2010-11 to 2017-18 was Rs. 9140.03 crores. By adopting the modus operandi of the circular trading/round-tripping, the purchases of Rs. 9140.03 crores resulted in an inflated combined sale of Rs. 45519.74 crore. h) Furthe....
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....crore over the period from 2013-14 to 2016-17. The company submitted that annual balance sheets for the year 2013-14, 2014-15 & 2015-16, CMA data, and project report along with the request application. In the proposal note dated 10.07.2015, the banks have considered the submitted balance sheets of the company for analysis. The banks were relying on the information disclosed in the financial statements with respect to Turnover, Different Ratio, Profitability, Asset Quality, based on these financial Parameters which are derived from the figures given in the balance sheets duly submitted by SRS Modern to Union Bank of India, and decided to lend/sanction the credit facilities. l) It is revealed that annual balance sheet submitted by SRS Modern Sales Ltd. to the banks for the year 2013-14, 2014-15 and 2015-16 shows gross sales as Rs. 533.88 Crore Rs. 547.37 Crore and Rs. 569.44 Crore respectively. However, the investigation has revealed that these sales figure includes the sales resulting out of circular entries and sales to own non-SRS companies. The amount of these sales for the year 2013-14, 2014-15 and 2015-16 are Rs. 454.21 Crore Rs. 488.97 Crore and Rs. 434.7 Crore respec....
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.... 2016-17 Receipt 8.97 6.91 9.59 4.33 9.58 37.44 5.95 Payment 5.54 4.18 12.74 4.05 4.32 14 17.19 s) It is revealed that these transactions have not been reflected as related party transactions in the respective years. t) Investigation revealed that the company majority transacted in the sale & purchase or made the investment in unlisted shares of companies of SRS Group in the year 2010-11 and 2017-18. Neither the share certificates nor the transfer deeds were maintained and transfer fee on the purchase of unlisted shares was not paid to the Government. The purpose of entering in these sale purchases of shares was to set off intercompany balances and to adjust losses of the company or to show the company in profits. u) Investigation revealed that the company had paid rent in lieu of an assured return to the investors who were invested in the properties at SRS Towers from the year 2010-11 to 2016-17. It is also revealed that the payment had been made but no benefit had been accrued to the company. The rent paid is nothing but the amount paid in lieu of assured returns to the investor of SRS Real Infrastructure ....
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....n the sale purchase or made the investment in unlisted shares of companies of SRS Group. It is observed that the company had entered into the transaction of unlisted shares at the same rate or different rates on the same day/year during the period 2010-11 to 2016-17. Neither the share certificates nor the transfer deeds were maintained and the transfer fee on the purchase of unlisted shares was not paid to the Government. The purpose to entering in these sales & purchases of shares was to set off intercompany balances and to adjust losses of the company or to show the company in profits. cc) Investigation revealed that the company had paid rent in lieu of an assured return to the investors who were invested in the properties at SRS Towers, SRS Emarald Court from the year 2010-11 to 2016-17. It is also revealed that the payment had been made but no benefit had been accrued to the company. The rent paid is nothing but the assured return paid by the Top choice Computech limited to the investor of SRS Real Infrastructure Limited who have purchased the property in SRS Tower. xx xx xx xx xx 23. In view of the above, it is submitted that petitioner, being amongs....
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....elief of bail to two of the co-accused/statutory auditors namely Ruchi Jain & Pankaj Mittal is concerned, it is submitted that, the petitioner herein cannot seek parity with any of the co-accused/statutory auditors as they have been granted the relief on peculiar facts and circumstances of their cases. In this regard it is submitted as under:- Petitioner/co-accused Name of Companies vis-à- vis financial year wherein Accused/petitioners were Auditor Case Against co-accused/Petitioner Ruchi Jain (co-accused on bail from Ld. Special Court) * SRS ltd for F.Y's 2013-14 to 2015-16 * SRS Real Estate Limited for FY's 2011-12, 2013-14 to2015-16. * SRS Ltd: - It is revealed that the Auditor knowingly did not verify the actual stocky inventory, which would have revealed about the movements of stock resulting in revelation of bogus sales/purchase of goods. * Investigation revealed that debtors mentioned in the financial statements contained the names of other SRS Group Companies. However, these companies were not declared as 'related parties. Pankaj Mittal (co-accused on bail from Ld. Special Court) * BTL Holding Co. Ltd (F.Y. 2015-16) * SRS Smart Retail....
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....id balance sheets submitted to the banks for the year 2013-14, 2014-15 and 2015-16 shows gross sales as Rs. 533.88 crore Rs. 547.37 Crore and Rs. 569.44 Crore respectively. However, the investigation has revealed that these sales figure includes the sales resulting out of circular entries and sales to own non-SRS companies. It is revealed that the said balance sheets submitted to the banks for the year 2013-14, 2014-15 and 2015-16 shows gross purchase as Rs. 521.52 Crore Rs. 536.67 Crore and Rs. 564.50 Crore respectively. However, the investigation has revealed that these purchases figures includes the purchases resulting out of circular entries and purchases from own non-SRS companies. The amount of these purchases for the year 2013-14, 2014-15 and 2015-16 are Rs. 446.02 Crore Rs. 475.76 Crore and Rs. 456.36 Crore respectively. It is revealed that the total purchase of Jewellery made by the SRS Group (consisting of SRS Companies and Non-SRS Companies) from the other sources (companies/entities, Bank and Import) excluding the SRS Group from the year 2010-11 to 2017-18 was for Rs. 9140.03 crores. By adopting the modus operandi of circular trading/round-tripping, the purchases ....
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....d shares at the same rate or different rates on the same day/year during the period 2010-11 to 2016-17. The purpose to entering in these sale purchases of shares was to set off intercompany balances and to adjust losses of the company or to show the company in profits. * Top choice Computech Ltd:- The loans and advances received from some SRS Group companies were not reflected as a related party transaction in the years 2012-13, 2014-15, 2015-16 and 2016-17. Further, transactions have not been reflected as related party transactions in the respective years. 45. That the aforesaid clearly shows that the petitioner herein has been arrayed as an accused with respect to the audit work done by him respecting the companies as detailed above which are different from the companies whose financials have been audited by the co-accused/statutory auditors namely Ruchi Jain & Pankaj Mittal. Further, the falsification/misstatements in the financials of the companies audited by co-accused Ruchi Jain & Pankaj Mittal is different from that of the financials audited by the petitioner herein. 46. That in this regard pertinent would be to mention that in case of co-accused Ruch....
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....iled by the petitioner, and further denies every allegation levelled against the answering respondent bank, and its officials, and further submits that the duties performed by the officials of the respondent bank, has been done diligently, as per banking norms and guidelines, under the parameters of banking Rules and laws. It is further submitted that the contentions that has not been expressly denied by the respondent bank hereinafter, should not be construed as an admission and rather be treated as a denial. 4. That the answering respondent Bank State Bank of India (SBI) (hereinafter refer to as respondent-bank (SBI)) is a body corporate constituted under the State Bank of India Act, 1955 having its Corporate Centre at Madame Cama Road, Nariman Point, Mumbai-400021 and one of its Local Head Office at 11. Parliament Street, New Delhi-110001 and one of its Branches, Stressed Assets Management Branch-l, at 6th Floor, Mohan Singh Place, Baba Kharak Singh Marg. Connaught Place, New Delhi-110001. It is a body corporate with perpetual succession and can sue and be sued in its own name. 5. That the action of granting financial assistance to SRS group of companies. is to....
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....orporate Guarantor) Registered Office: Fiat No. 202. 2nd Floor, 27, New Delhi House, Barakhamba Road, Connaught Place, New Delhi-110001., 10) Latest It Solutions Pvt. Ltd. (Corporate Guarantor) Registered Office: Flat No. 202. 2nd Floor, 27. New Delhi House, Barakhamba Road, Connaught Place, New Delhi-110001. Second Address: Unit No. 713. SRS Tower, Gt Road, Near Metro Station, Mewla, Maharajpur, Faridabad, Haryana 121003. 11) BTL Portfolio Limited (Corporate Guarantor) Registered Office: "SRS Multiplex", Top Floor, City Centre, Sector-12. Faridabad, Haryana-121007. Second Address: Flat No. 202. 2nd Floor, 27. New Delhi House, Barakhamba Road. Connaught Place, New Delhi-110001. 12) SRS International Limited (Corporate Guarantor) Registered Office: Flat No. 202, 2nd Floor, 27. New Delhi House, Barakhamba Road, Connaught Place, New Delhi-110001. 13) BTL Holding Company Ltd (Corporate Guarantor), Registered Office: Flat No. 202, 2nd Floor, 27, New Delhi House, Barakhamba Road, Connaught Place, New Delhi-110001. 7. That in lieu of said financial assistance, the borrower, i.e., SRS Limited, with an intention to secure the loan/credit faciliti....
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...., Sector-2, Urban Estate, Faridabad, ad-measuring 22.68 Sq. Mtr 15) Plot of Land situated at S.C.O Plot No. 91, Huda Market, Sector-2, Urban Estate, Faridabad, ad-measuring 137.50 Sq. Mtr.. 16) Plot of Land situated at S.C.O Plot No. 94, Huda Market, Sector-2. Urban Estate, Faridabad, ad-measuring 137.50 Sq. Mfr. 17) Plot of Land situated at Shop Booth No. 36. Huda Market, Sector-2, Urban Estate, Faridabad, ad-measuring 22.68 59. Mir 18) Plot of Land situated at Shop Booth No. 54, Huda Market, Sector-8, Urban Estate, Faridabad, ad-measuring 22.68 Sq. Mtr 19) Plot of Land situated at Kiosk No. 176, Huda Market, Sector-15. Urban Estate, Faridabad, ad-measuring 81.80 Sq. Ft. 20) Plot of Land situated at Shop Booth No. 60, Huda Market, Sector-20A, Urban Estate, Faridabad, ad-measuring 22.687 Sq. Mtr 21) Plot of Land situated at Shop Booth No. 61, Huda Market, Sector-20A, Urban Estate, Faridabad, ad-measuring 22.687 Sq. Mtr 22) Plot of Land situated at Shop Booth No. 61, Huda Market, Sector-16, Urban Estate, Faridabad, ad-measuring 29.84 Sq. Mtr 23) Plot of Land situated at Kiosk No. 181, Huda Market, Sector-15, Urban Estate, Faridab....
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....a) 9 Kanals 0 Marla out of khevat/khata No. 1174/1364, mustil No.150 kila No. 24/2 (1-17), 25/2 (1-17), mustil No. 156 kila No. 4/1 (1-17), 5/1 (3-9) kita 4; and (b) land admeasuring 12 Kanals 11 Marla out of khevat No. 1175/1365 mustil No. 149 kila No. 22/2 (2-13), mustil No. 157 kila No. 2 (6-17), 3 (8-0), 9 (7-3), 10/2 (2-13), 12 (7-13), 19/1 (1-11), 26 (1-13) kita 8 at Sector 8, Palwal, Haryana. 11. That even further SRS Automotive, also deposited the title deeds, of his immovable property, i.e., SRS Tower on 14/15, Mathura Road, Near Mewla Maharjpur Metro Station, Faridabad, Haryana 121003 with all the building and structure on Land measuring 13 Kanals comprised in Khasra No. 44/22/2, area 2 Kanals 13 Marlas, Khasra No. 44/23, area 8 Kanals, and Khasra No. 24/1, area 2 Kanals 7 Marlas situated in Revenue Estate of Mewia, Maharajpur, Tena Faridabad, District Gurgaon 12 That the respondent bank, Individually and through consortium granted various credit facilities to the borrower (SRS Limited). The details of which is as below: 13 FIRST CREDIT FACILITY: That the respondent bank (SBI) individually. provided the credit/loan facilities as tabulated below ....
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....7 for Rs. 121.52 crores by "SBI Consortium", i.e. SBI, BOI, UBI, State Bank of Patiala (SBP), State Bank of Travancore (SBT), State Bank of Bikaner and Jaipur (SBBJ). Further the consortium banks entered into an inter-se Agreement dated 25.08.2007 regarding the sharing of the hypothecated assets of SRS Limited. Respondent bank-SBI was designated as Security Agent of the 'SBI Consortium' vide Security Agent Agreement dated 25.08.2007. BANK WORKING CAPITAL Non Fund Based LC/SBLC TOTAL (In Crores) STATE BANK OF INDIA 47.00 47.00 BANK OF INDIA 15.00 15.00 UNION BANK OF INDIA 16.72 16.72 STATE BANK OF PATIALA 25.00 2 5.00 STATE BANK OF TRAVANCORE 10.00 10.00 STATE BANK OF BIKANER & JAIPUR 7.80 7.80 TOTAL 121.52 121.52 19. That further, in consideration to the grant of aggregate facilities of Rs. 121.52 crores, borrower company and its guarantors, signed and executed the following loan and guarantee documents on 25.08.2007 in favour of consortium Bank. The documents are: a) Facility Agreement dated 25.08.2007 in token of having accepted the terms and conditions. b) a Joint Deed of H....
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....rge on Fixed Assets dated 29.12.2008 by SRS limited. i) Letter of Undertaking for not creating further charge over their Property and Assets including uncalled Capital dated 29.12.2008 by SRS limited. j) Letter of Undertaking dated 29.12.2008 by SRS limited. k) SRS limited along with respondent bank and BTL Investment Ltd. signed and executed a Tripartite Agreement for Payment of Monthly Rentals dated 29.12.2008 l) A Link Letter dated 29.12.2008 executed by borrower and guarantors ((6(1) to (6(7)). m) Balance Confirmation as on 27.12.2008 by SRS limited. n) a Revival Letter dated 29.12.2008 and 17.01.2009, executed. by SRS limited in favour of respondent bank. 22. FOURTH CREDIT FACILITY: That SRS limited on 17.01.2009, availed Working Capital Facilities for Rs.30.00 crores from the "SBI Consortium", consisting SBI, UBI, and OBC. The details is tabulated below: BANK WORKING CAPITAL (Fund Based) TOTAL (In Crores) STATE BANK OF INDIA 15.00 15.00 UNION BANK OF INDIA 03.00 03.00 ORIENTAL BANK OF COMMERCE 12.00 12.00 TOTAL 30.00 30.00 23. That in consideration to the grant....
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....n Working Capital @ SBAR, i.e. 11.75% and Term Loan @ SBAR, i.e. 11.75% p.a. with monthly rests. b) Agreement of Loan for Overall Limit dated 05.08.2009. c) Agreement of Hypothecation of Goods and Assets dated 05.08.2009. d) A Deed of Guarantee dated 05.08.2009, by SRS Limited (6 (1) to 6(7)). e) Letter regarding the Grant of Individual Limits within the Overall Limit dated 05.08.2009. f) L/C Agreement-cum-Indemnity dated 05.08.2009 by SE Limited. Letter of Undertaking dated 05.08.2009 by SRS Umited. h) RBI Consent Clause dated 05.08.2009 by SRS Limited. i) CIBIL Consent Clause dated 05.08.2009 by borrower and Guarantors (Para 6(1) to 7 (7)) j) SRS Limited, SBI Bank and SRS Finance Ltd. signed and executed a Tripartite Agreement for Payment of Monthly Rentals dated 05.08.2009. k) A Link Letter dated 05.08.2009 l) A Balance Confirmation as on 03.08.2009. m) A Revival Letter dated 05.08.2009. 27. FIFTH CREDIT FACILITY: That SRS limited on 02.08.2010, availed Working Capital Facilities for Rs.195.00 crores from the "SBI Consortium", consisting SBI, BOI, SBT, SBP, OBC. The detail....
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....11 TERM LOAN-II (NEW) RS. 50.00 TOTAL TERM LOANS RS. 69.11 TOTAL NON FUND BASED LIMITS RS. 159.11 NON FUND BASED LIMITS LETTER OF CREDIT RS. 55.00 TOTAL NON FUND BASED LIMITS RS. 55.00 TOTAL: RS. 214.11 31. That in consideration to the grant of the aforesaid Overall Limit of Rs.214.11 crores by SBI Consortium", the Borrower and its Guarantors, signed and executed and kept on executing various loan and guarantee documents in favour of respondent bank and its consortium. The executed documents are" a) the Agreement of loan for Term Loan II (New) dated 24.03.2011 b) Agreement of Hypothecation of Goods for Assets dated 24.03.2011 for Term Loan II (New). c) Agreement of Hypothecation of Goods for Assets dated 24.03.2011 d) Deed of Guarantee dated 24.03.2011 for Term Loan II (New). e) Letter Regarding the Grant of individual Limits for Term Loan II (New) dated 24.03.2011. f) Agreement of loan for Overall Limit dated 24.03.2011 of Rs. 145.00 Crores g) Agreement of Hypothecation of Goods and Assets dated 24.03.2011 for the Overall Limit of Rs. 145.00 Crores. h) ....
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.... in favour of respondent bank. 34. That further SBI Consortium, entered into an Inter-se Agreement dated 30.05.2011 regarding the sharing of the hypothecated assets of SRS Limited. Respondent Bank (SBI) was designated as the Lead Bank of the 'SBI Consortium and Letter of Authority doled 30.05.2011. 35. ENHANCEMENT/RENEWAL: That SRS limited, sought renewing/enhancing the loan/credit facility, Respondent bank SBI renewed the aforesaid loan/credit facilities vide sanction letter dated 31.03.2012. NATURE OF FACILITY/LIMIT AMOUNT (IN CRORES) (I) CASH CREDIT (HYP, OF STOCK) RS. 90.00 (II) CASH CREDIT (METAL LOAN) (RS. 20.00) (III) CASH CREDIT (HYP. OF GOLD/JEWELLERY) (RS. 12.00) (IV) CASH CREDIT (BOOK DEBTS JEWELLERY) (RS. 12.00) (V) CASH CREDIT (BOOK DEBTS WHOLESALE) (RS. 12.00) TOTAL FUND BASED WORKING CAPITAL LIMITS RS. 90.00 (I) TERM LOAN (OUTSTANDING) RS. 17.80 TOTAL FUND BASED LIMITS RS. 17.80 A. NON FUND BASED LIMITS (I) LETTER OF CREDIT RS. 205.00 TOTAL NON FUND BASED LIMITS RS. 205.00 TOTAL LIMIT (A+B) RS. 312.80 36. That in consideration to the enhancement/ renewa....
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.... SBI, SRS limited, as Borrower and other Guarantors, signed and executed the various loan and guarantee documents on 23.10.2010 in favour of the SBI. The documents are: a) Letter of Sanction of Credit Facilities dated 12.10.2012 in token of having accepted the terms and conditions regulating the aforesaid Overall Limit of Rs. 316.25 crores. b) Agreement of loan for Overall Limit dated 23.10.2012 of Rs. 22.78 crores. c) Agreement of Hypothecation of Goods and Assets dated 23.10.2012 of Rs. 22.78 crores. d) the Deed of Guarantee dated 23.10.2012 for the Overall Limit of Rs. 22.78 crores. e) Grant of Individual Limits within the Overall Limit dated 23.10.2012 for the Overall Limit of Rs. 22.78 crores. f) Agreement cum indemnity dated 23.10.2012 for the Non fund based Limit of Rs. 205.00 crores. g) Undertaking 23.10.2012 in favour of the respondent bank (581). h) a CIBIL Letter 23.10.2012 in favour of SBI. i) the Link Letter dated 23.10.2012 in favour of the SBI. 39. SEVENTH CREDIT FACILITY: That SRS limited on 23.10.2012, availed Working Capital Facilities for Rs.625.00 crores from the "SBI Conso....
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....ON FUND BASED LIMITS (III) LETTER OF CREDIT RS. 205.00 TOTAL NON FUND BASED UMITS RS. 205.00 TOTAL LIMIT (A+B) RS. 315.00 43. That in consideration to the abovementioned Credit/loan facilities of Rs.315.00 crores by SBI, SRS Limited, as Borrower and other persons and detailed in Para 6 as Guarantors, signed and executed various loan and guarantee documents in favour of the SBI. The documents are: a) Letter of Sanction of Credit Facilities dated 28.11.2013 in token of having accepted the terms and conditions regulating the aforesaid Overall Limit of Rs. 315.00 crores. b) Agreement cum Indemnity dated 04.02.2014for the Letter of Credit Limit of Rs. 205.00 crores. c) Declaration dated 04.02.2014 for the Overall Limit of Rs. 315.00 crores. d) Certificate dated 04.02.2014 for the Overall Limit of Rs. 315.00 crores. e) separate confirmation letters dated 04.02.2014 f) Declaration cum Undertaking dated 04.02.2014. g) A CIBIL Consent Clause dated 04.02.2014. 44. EIGHTH CREDIT FACILITY: That SRS limited on 04.02.2014, availed Working Capital Facilities for Rs.825.00 crores from the "....
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....CASH CREDIT (METAL LOAN) RS. 40.00 TOTAL FUND BASED WORKING CAPITAL LIMITS RS. 100.00 (III) CORPORATE LOAN RS. 08.50 TOTAL FUND BASED LIMITS RS. 108.50 D. NON FUND BASED LIMITS (IV) LETTER OF CREDIT RS. 205.00 TOTAL NON FUND BASED LIMITS RS. 205.00 TOTAL LMIT (A+B) RS. 313.50 48. That in consideration to the abovementioned Credit/loan facilities of Rs.313.50 crores by SBI, SRS Limited, as Borrower and others mentioned in Para 6 as Guarantors, signed and executed various loan and guarantee documents on 16.03.2015. The documents are: a) Letter of Sanction of Credit Facilities dated 16.03.2015 in token of having accepted the terms and conditions regulating the aforesaid Overall Limit of Rs. 313.50 crores. b) Balance Confirmation letter as on 31.03.2015. 49. ENHANCEMENT / RENEWAL: That SRS limited, sought renewing/enhancing the loan/credit facility. Respondent bank SBI renewed. the aforesaid loan/credit facilities vide sanction letter dated 03.03.2016. NATURE OF FACILITY/LIMIT AMOUNT (IN CRORES) CASH CREDIT (HYP. OF STOCK) RS. 100.00 COMMERCIAL PAPER (RS.100.00) FBD/EBR (RS. ....
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.....03.2016 : Rs. 50,00,00,000.00 ii. Accrued Interest from 01.04.2016 till 06.05.2018 : Rs. 13,84,31,758.14 Total of C : Rs. 63,84,31,758.31 E. A/C NO. 61133402581 (SBBJ) i. Outstanding amount along with interest upto 28.06.2016 : Rs. 50,01,36,65.23 ii. Accrued Interest from 29.06.2016 till 06.05.2018 : Rs. 12,05,85,802.22 Total of E : Rs. 62,07,22,457.45 F. A/C NO. 67119842889 (SBT) i. Outstanding amount along with interest upto 28.06.2016 : Rs. 38,90,53,966.04 ii. Accrued Interest from 29.06.2016 till 06.05.2018 : Rs. 9,46,76,383.81 Total of F : Rs. 48,37,30,349.85 G. A/C NO. 32661891349 (CORPORATE LOAN) . Outstanding amount along with interest upto 28.06.2016 : Rs. 4,75,03,150.00 ii. Accrued Interest from 29.06.2016 till 06.05.2018 : Rs. 1,21,33,283.56 Total of G : Rs. 5,96,36,433.56 H. A/C NO. 65088929561 (SBP) i. Outstanding amount along with interest upto 28.06.2016 : Rs. 86,76,59,778.14 ii. Accrued Interest from 29.06.2016 till 06.05.2018 : Rs. 20,73,11,879.79 Total of H : Rs. 1,07,49,71,657.87 TOTAL A+B+C+D+E+F+G+H : Rs. 5,85....
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....xtended loans routinely, presuming that everything was in order. Thus, in view of no objection raised by the banks and non-consideration of any document prepared by any of the petitioners-Chartered Accountants, it cannot be said that at the time of extending the loan by the consortium of banks, any of the petitioner(s)-Chartered Accountants, including Internal and Statutory Auditors, had any role or participation. 28. Regarding siphoning off the loans by the petitioner-Chartered Accountants, the primary question is: 'What was their culpability or conspiracy?' The statutory auditors are paid professional fee as remunerations for their services in accordance with the rules or prevalent market practices. A perusal of the complaint or the reply filed by the consortium of banks, does not point towards a single averment that any of the petitioners-Chartered Accountants, who were statutory auditors, were paid remunerations which were disproportionate to the work they had done or was it more than the market rates or it was on the higher side, which would reflect that the SRS Group of Companies was compensating them for favourable audit reports. Needless to say, the company's funds c....
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....e offence is covered under Section 447^2 of the Companies Act, 2013, the statutory rigors of S.212(6) of the Companies Act, 2013 come into operation, and the accused seeking bail must satisfy its twin conditions. On reading S. 212(6) of the Companies Act, 2013, it is clearly inferable that to protect the financial interests of the shareholders, investors, financers, tax authorities, employees, and business partners, etc., the legislature added teeth to make bail difficult for the violators of the provisions of the Companies Act, 2013. The provisions are couched in negative language and explicitly mandate that in order to grant bail; the Court must record a finding that there are reasonable grounds for believing that the accused seeking bail is not guilty of the offence. Even if the Court fulfills one of the conditions, namely, reasonable grounds for believing that the accused is not guilty of such an offense, the Court has to take steps by putting conditions to assure that while on bail, the accused is not likely to commit any such crime again. Both the twin conditions must be satisfied before a person accused of Section 447 of Companies Act, 2013 is to be released on bail. If eith....
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....t was usurped - and are now hunting for someone to blame. If there were intentional lapses by Chartered Accountants, why were they not arrested and subjected to a custodial investigation before the complaint was filed? The siphoning of massive funds points to failures not only of the Chartered Accountants but also of the Regulators and Tax Authorities, as well as loopholes in statutes and rules. 37. In Serious Fraud Investigation Office v. Nittin Johari, decided on 12-09-2019, a three-Judge bench of Hon'ble Supreme Court holds, [11]. At this juncture, it must be noted that even as per Section 212(7) of the Companies Act, the limitation under Section 212(6) with respect to grant of bail is in addition to those already provided in the Cr.P.C. Thus, it is necessary to advert to the principles governing the grant of bail under Section 439 of the Cr.P.C. Specifically, heed must be paid to the stringent view taken by this Court towards grant of bail with respect of economic offences. In this regard, it is pertinent to refer to the following observations of this Court in Y.S. Jagan Mohan Reddy (supra) [(2013) 7 SCC 439]. 38. The law of bail, like any other branch of law, ha....
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....ss- (i) the Public Prosecutor has been given an opportunity to oppose the application for such release; and (ii) where the Public Prosecutor opposes the application, the court is satisfied that there are reasonable grounds for believing that he is not guilty of such offence and that he is not likely to commit any offence while on bail: Provided that a person, who, is under the age of sixteen years or is a woman or is sick or infirm, may be released on bail, if the Special Court so directs: Provided further that the Special Court shall not take cognizance of any offence referred to this sub-section except upon a complaint in writing made by- (i) the Director, Serious Fraud Investigation Office; or (ii) any officer of the Central Government authorised, by a general or special order in writing in this behalf by that Government. 2. S. 447. Punishment for fraud.-Without prejudice to any liability including repayment of any debt under this Actor any other law for the time being in force, any person who is found to be guilty of fraud, involving an amount of at least ten lakh rupees or one per cent. of the turnover of the company, wh....