A Strong Brew Of Lost Clients & Fudged Accounts

New Delhi, May 29: | Updated: May 30 2003, 05:30am hrs
He handed the nation its first indigenous can of beer. Sanjay Jain of Rajasthan Breweries Limited (RBL) wooed Strohs, Kingfisher, Lowenbrau among several others and set up a spiffy brewery off Delhi-Jaipur highway. Today, he doesnt have an address, his distributors have turned detectives and the police and courts waste a lot of paper tracking his cases.

There is a lot Sanjay Jain has to answer to his investors, employees and distributors (they paid upfront for consignments that never came) for. Like, how the travel bills of he and his family to USA and Israel, and farmhouses in Delhi and flats in Mumbai cropped up as business development expenses in the company account books.

This Distributor Wants His Money Back
Sanjay Jain owes nearly Rs 40 lakh to Sunil Yadav, a Delhi-based distributor. Yadav paid up Rs 25 lakh but RBL supplied him only two truckloads of beer.
Later, when Yadav asked Sanjay Jain to return rest of the money, Jain gave him six cheques amounting to Rs 25.85 lakh. Two bounced, and Jain requested Yadav not to deposit the others.
Meanwhile, the cheques expired. Jain promised to pay up later but defaulted again and Yadav filed a case. The promoter was arrested in September 2001 for few hours but was immediately bailed out.
Jain issued Yadav fresh cheques amounting to Rs 18 lakh alongwith a three-year-old Honda City and Rs 1 lakh in cash. The cheques bounced again. Sanjay went to jail in December 2002 for four-five days.
Today Yadav is fighting 13 cases against Jain and his wife Nisha Narain Jain, also a director in the company.

S K Lahiri, the companys CEO between February 1995 to August 1996, says RBL did not pay provident fund to its over 100-odd employees amounting to nearly Rs 15 lakh. In fact, for a long time, the management didnt open an EPF account but kept on deducting it from employees salary.

FACT FILE

Money raised from investors: Rs 136 crore
Money they raised from investors: Rs 50 crore
Money they raised from FIs: Rs 82 crore
Money they owe to distributors: Rs 2.5 crore
The companys shares are traded till 1998
Where the promoter is today: Sanjay Jain is in Delhi and keeps shuttling between houses owned by his family members. This farmhouse is owned by his brother in Chhatarpur. None of his lenders can pin him down.

Mismanagement and diversion of funds are the reasons why the brewery looks the way it is today. Near the 111 km milestone from Delhi, there is no Rajasthan Breweries Ltd signboard. Its been shut for two years now. There is nothing but rusted pipes, an empty warehouse and heaps of beer bottle caps bearing labels including Kingfisher, Derby, Bullet and Lowenbrau.

The main gate of the plant is locked and sealed by the Bank of Rajasthan which took possession of the assets last year. A section of the property has been sold off and the new owners have begun construction.