The ministry of corporate affairs has ordered an investigation into Austral Coke and Projects Ltd as it has found serious irregularities such as falsification of accounts and income tax evasion. The ministry has directed the investigating agency, Serious Fraud Investigation Office (SFIO), to conduct an investigation under Section 235 of the Company?s Act.
An official of the ministry told FE, ?The investigation department of the ministry of corporate affairs has suspected serious irregularities in the accounts books of Austral Coke and Projects Ltd and has directed the SFIO to conduct an investigation in the company.?
The low ash metallurgical coke manufacturer?s promoters Ratan Lal Tamakhuwala and Rishi Raj Agarwal refused to speak to FE.
Austral Coke and Projects has already been barred by Sebi from raising funds from the capital market.
This was after the Income Tax department found that the company had prima facie committed a fraud on its shareholders. In its letter dated August 26, 2009 to Sebi, it had said, ?The company appears to have prima facie violated the provisions of Regulation 3 & 4 of the Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 2003.? The company had raised Rs 140 crore through IPO in August 2008 to finance its expansion. However, an investigation undertaken by the Income Tax department found that a part of the funds raised was wrongly shown in the books of the company as utilised towards purchase of capital goods which were bogus.
The company was also nailed by the tax department for showing bogus purchases and sales in the books of accounts of the company. The investigation on the residential and business premises of Austral Group had found that the company had been showing fake purchases worth Rs 553 crore from 29 non-existent concerns all floated by one Ajitkumar Jindal from Kolkata. The tax authorities had also found out that the company had shown bogus sales of Rs 595 crore in its books of accounts.
