NCLT orders freeze on accounts, assets of Videocon group

MUMBAI: The Mumbai bench of the National Company Law Tribunal (NCLT) on Tuesday ordered the Videocon group’s bank accounts frozen and properties attached following a petition by the ministry of corporate affairs.

In an order issued late in the evening, the tribunal has asked the promoter, Venugopal Dhoot, to disclose the moveable and immovable properties and bank accounts belonging to the group in India and abroad. The court has also directed the Central Depository Services Ltd (CSDL), National Securities Depository Ltd (NSDL), Central Board of Direct Taxes (CBDT), Reserve Bank of India (RBI) and Indian Banks’ Association (IBA) among others to name the Videocon assets under their watch and for them to be frozen with immediate effect in order to be used for recovery of dues.

The ministry had approached the Mumbai bench against Venugopal Dhoot and other former directors and senior officials of Videocon Industries Ltd under Section 241 and 242 of the Companies Act that deals with oppression and mismanagement in the company.

The court noted that the reserves and surpluses of Videocon Industries, as declared in the financial statements in 2014, stood at ₹10,028.09 crore and for fiscal year 2019 at ₹2,972.73 crore, showing a steep fall in just five years. During the same period secured loans rose from ₹20,149.23 crore to ₹28,586.87 crore.

“The Bench is surprised with the manner in which the financial institution has come forward to grant loans to a sinking ship and again come forward to file a petition under Section 7 of the IBC and again supports this petition. This certainly raises the eyebrows of the common man in the public,” read the order.

The order said that transaction audit reports also reveal fraudulent transactions by the promoters.

The latest order by the NCLT has put further roadblocks on the potential transaction between Anil Agarwal-backed Twin Star Technologies and VIL.