Subhiksha Trading Services has taken its erstwhile auditor, Deloitte, to court for allegedly parting with sensitive information to a government probing agency.
Subhiksha Trading had earlier approached a disciplinary committee of the auditing regulators, Institute of Chartered Accountants of India (ICAI), for passing on information of Subhiksha?s balance-sheet to the Serious Fraud Investigation Agency that was mandated by the government to probe Subhiksha?s books after widespread allegations of wrongdoings by the retailer before it went bust in early 2009, according to a source.
Vandana Nagpal, the director for ICAI?s disciplinary committee, confirmed that Subhiksha had approached her office, but declined to comment on the matter.
With the disciplinary wing of ICAI dismissing the plea, Subhiksha approached the Madras High Court, challenging the ICAI?s clean chit, the source said.
Subhiksha?s founder R Subramanian declined to comment, saying the company does not comment on matter that are before any court or any quasi-judicial body.
A Deloitte spokesperson said in an e-mailed statement: ?We have been the auditors of the company from 1999-2000 onwards. Given the nature of our relationship with the company, we are bound by professional conduct regulations relating to confidentiality and, therefore, are not in a position to discuss any matters pertaining to the company?.
Maverick businessman Subramanian founded Subhiksha as a single store in Chennai in 1996 and, then, turned it into a nationwide network of 1,600 grocery, pharmacy and mobile phone stores.
However, the slowdown in late 2008 proved fatal for the company and it went bust as it was unable to churn in working capital amid shrinking consumer spending.
Unable to raise capital from the market ot banks, Subhiksha suspended its operations throughout the country amid allegations of non-payments of staff salaries, rents and for supplies to dozens of vendors.
Then in July 2010, the ministry of corporate affairs ordered investigation into Subhiksha following widespread fraud allegations about the company. However, the SFIO probe is still bogged down in court cases and hasn?t moved forward.
Earlier this week, the Madras High Court ordered liquidation of Subhiksha hearing a case filed by Kotak Mahindra Bank which had lend R40 crore to the mothballed retailer.