Shivinder Singh vs Malvinder Singh: This is how company was debt trapped
In a petition, seen by DNA Money, Shivinder Singh had alleged that Malvinder and Godhwani used Religare Enterprises Ltd (REL), a non-banking financial company, to borrow the money from public and pushed this company into debt trap.
Shivinder Singh has alleged in his petition in National Company Law Tribunal (NCLT) that his brother Malvinder misused the extended inter-corporate deposits (ICD) as a tool in collusion and connivance with Sunil Godhwani, which was contraventions of various laws and "become the key issue for depicting oppression and mismanagement in RHC Holding company".
In a petition, seen by DNA Money, Shivinder Singh had alleged that Malvinder and Godhwani used Religare Enterprises Ltd (REL), a non-banking financial company, to borrow the money from public and "pushed this company into debt trap".
In 2016, Malvinder Singh used his postion and "caused the companies to extend loan in the form of ICD of Fortis Healthcare Ltd (FHL) and use it for the RHC Holding Company. About Rs 473 crore were taken out of FHL and used to pay the lenders of RHC.
Shivinder alleged that the payment did not help RHC instead led to value erosion of wealth and pushed into a debt trap. In 2017, ICDs turned as a hurdle for negotiation.
Shivinder Singh resigned from all the posts of Fortis Health on September 23, 2015, after which he and his wife Aditi Singh joined Radhasoami Satsang Beas (RSSB) at Beas, Punjab, for charitable work.
On behalf of the Religare Finvest Ltd (RFL), an NBFC subsidiary of REL, Sunil Godhwani had created the fixed deposit of approximately Rs 750 crore with Laxmi Vilas Bank on November 19, 2016, against the security of RHC Holdings and its subsidiary Ramchem Pvt Ltd and granted about Rs 750 crore . "This move eroded capital base and loan avail by RHC against the FD, which remain outstanding till date" the petition said.
The first major shock to FHL came in July 2017 after First Gulf Bank had declared RHC and its subsidiaries as a defaulter.
The next major dumping of FHL shares by RHC and its subsidiaries in August 2017 followed by Indiabulls selling the shares. And the fourth dumping took place after Supreme Court Order on August 31, 2017.
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According to petition Malvinder Singh has used Shivinder Singh's wife Aditi Singh forged the signature and shown it during the Board meetings when she was abroad.
Source: DNA Money
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