Bambino Agro facing fraud allegations
2 from promoter family allege fraud, forgery in the BSE-listed company, and file petition in NCLT alleging related party transactions, causing huge loss to the company
♦ Myadam Kartekeya owns 18.11% stake in BAIL
♦ His mother Myadam Anitha, wife of late Myadam Raghuveer, owns 19.88% stake
♦ They alleged that the current management indulged in wide-spread related party transactions
♦ Inflated inventory levels
♦ Rs17-cr worth machinery transferred to non-subsidiaries
♦ Kartekeya further said in the petition that he was arbitrarily removed from the Board of Bambino Agro in September 2017
♦ Petitioners named 13 respondents
Hyderabad: Two persons from the promoter family of city-based Bambino Agro Industries Limited (BAIL) have levelled allegations of fraud, forgery, widespread related-party transactions, gross mismanagement, gross undervaluation and corruption in the BSE-listed company and also against its current management.
In a petition filed with the Hyderabad Bench of the National Company Law Tribunal (NCLT), which is expected to come up for hearing, Myadam Kartekeya, who owns 18.11 per cent stake in Bambino Agro, and his mother Myadam Anitha, wife of late Myadam Raghuveer, who also owns 19.88 per cent stake in the company, alleged that the current management indulged in wide-spread related party transactions, causing huge loss to Bambino Agro.
The petition also mentions that Myadam Kartekeya was arbitrarily removed from the Board of Bambino Agro in September 2017. The petitioners named 13 respondents including Bambino Agro Industries Limited, Myadam Shirisha, Managing Director, Myadam Sugandha Bhai, Additional Director, Venkataraman Subramanian, Independent Director, and Nagarajan Venkataraman Rao, Chief Financial Officer, Bambino Agro, besides Serious Fraud Investigation Office. MyadamShirisha is sister of MyadamKartekeya (petitioner 1).
According to the petitioners, machinery costing Rs 17 crore purchased by BAIL was transferred to Bambino Pasta Private Limited and Seshsayi Foods, which are not subsidiaries of the listed company. The management committed forgery and fraud, while transferring the machinery, the petitioners pointed out.
In another instance, some expensive machinery imported by BAIL was directly delivered to another related party, Diptanshu Food Industries Limited, Gurgaon, causing a loss of Rs 9.3 crore per month to BAIL. The company is also conducting business with related parties (Ghanta Foods Private Limited) in violation of existing laws.
The petitioners also said that current management inflated inventory levels though there was no substantial increase in profits and assets of the company. BAIL has been acting in the interest of the related party private companies where the Directors of BAIL or their family members own shares.
According to them, though BAIL is a public-listed company, none of its affairs are being managed in the manner befitting a public listed company where the public at large would be affected due to the acts of mismanagement.
The petitioners sough appropriate orders from NCLT under Section 241, 242 and 245 of the Companies Act-2013, to 'bring to an end the acts of oppression and mismanagement being perpetrated' by the respondents. They also sought investigation into the affairs of Bambino Agro and removal of its Managing Director and other company officials. The duo also sought orders against related-party transactions.
The petitioners also sought several interim reliefs and appealed to the NCLT to order forensic audit into the financial statements, assets, debts, inventory, etc. They also sought an order suspending the Board of Directors of the company by appointing a receiver to manage the affairs of the company.
Incorporated as Jay Food Industries Limited in 1983, the company which is into the manufacturing of vermicelli, pasta, biscuits and other products was renamed as Bambino Agro Industries Limited in 1997. It has manufacturing units in Telangana (Bibinagar), Madya Pradesh (Bhopal) and Haryana (Gurgaon).