SFIO begins investigation into CG Power and its 15 group companies

The Serious Fraud Investigation Office (SFIO) has started probe into the alleged irregularities at CG Power and Industrial Solutions Ltd and its 15 group companies.

"The company has received a letter...from the office of the Joint Director (Investigation), SFIO, Ministry of Corporate Affairs...informing that the Central Government...has ordered an investigation by the SFIO into the affairs of the company and its 15 related/group companies (not having been specifically identified in the said letter)...The said SFIO Investigation has been initiated," CG Power and Industrial Solutions Ltd said in a regulatory filing.

The company was committed to cooperate with SFIO to enable them to complete its investigation in a time bound manner, the filing added.

Sources had earlier said that the Ministry of Corporate Affairs (MCA) has filed a petition before the Mumbai-bench of the National Company Law Tribunal (NCLT) seeking permission to re-open the books of account and recast the financial statements of CG Power and its subsidiary companies for the past five financial years beginning 2014-15.

MCA had previously asked its SFIO to probe the affairs of the company along with 15 other firms, including two subsidiaries CG Power Solutions Ltd and CG International BV.

The company had in August said that an investigation instituted by its board had found major governance and financial lapses, including some assets being provided as collateral and the money from the loans siphoned off by "identified company personnel, both current and past, including certain non-executive directors".

Gautam Thapar, who was non-executive chairman of the company, was removed by its board on August 29.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Business Standard is now on Telegram.
For insightful reports and views on business, markets, politics and other issues, subscribe to our official Telegram channel