Mumbai, Feb 05: The National Company Law Tribunal has allowed the Central Government’s plea for winding up the Pune-based company, Netwealth Agrotech India Limited, after the tribunal found that it had committed fraud and cheated around 2,400 villagers, thereby siphoning off the invested money of poor villagers from Pune and Beed districts. The tribunal noted that the company is yet to repay the invested money of around 700 customers.
Official Liquidator appointed
In its order, the tribunal appointed the Official Liquidator attached to the Bombay High Court as the liquidator of the company and directed him to carry out the procedure to take charge of the company’s properties.
Findings of fraud and mismanagement
The tribunal, in its order, maintained: “The findings of the investigation conducted by the Regional Director (Western Region), Mumbai, under the Ministry of Corporate Affairs, Government of India, reveal that the company had floated and operated unauthorised deposit-like schemes under the guise of plot allotment and assured returns, and that its affairs were conducted in a fraudulent manner, resulting in large-scale cheating of the public through acts of commission and omission by the company and its directors. The funds so mobilised from the public were misappropriated and siphoned off by the directors for purposes other than those represented to the investors, including diversion of monies, acquisition of properties, and non-refund of deposits, thereby causing substantial financial loss to a large number of customers and establishing a prima facie case of fraud and mismanagement.”
Directors accused of serious fraud
In its petition, the government stated that the managing director of the company, Machindra Baban Mundhe, along with directors Buvasaheb Janu Bochare and Umrao Vasantrao Gilbile, were involved in serious fraud.
It alleged that they had floated various schemes promising inflated returns and allotment of plots, thereby cheating several investors, particularly poor villagers from the surrounding areas of Pune and Beed districts, and siphoning off their money.
Company operations suspended in 2014
The company had suspended its business operations in 2014. However, in their sworn statements, the three directors gave consent for the takeover of all properties of the company by the government, at its discretion, for sale and repayment of the amounts due to customers.
Irregularities in financial filings
“The company filed its balance sheets for the financial years ending 31.03.2013 to 31.03.2017 on the MCA portal only on 30.04.2018. However, the same appeared to be forged or fabricated, as they lacked previous year figures, the auditor’s report, and notes to accounts. A further investigation revealed that the company raised approximately Rs 3.5 crore from about 2,400 customers, out of which Rs 2,08,65,107 remains unpaid to around 700 customers.”
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Company’s stated objectives
The company was incorporated with the object of carrying on business related to agro-based products. The main object clause of the company, as per its Memorandum of Association, reads as follows: “To carry on the business of agriculture and agricultural technology, including the manufacture of agricultural pesticides and fertilisers, and to produce, manufacture, and process all types of agro-based products and related activities.”
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