Manpasand Beverages says CMD willing to quit after GST fraud debacle; ropes in EY for guidance

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Published: June 6, 2019 1:16:16 PM

Dhirendra Singh expressed his willingness to take necessary actions in the best interest of the company. Earlier on 23 May 2019, search and seizure proceedings were carried out on various premises of the company.

Budget 2019, Section 87A, Income Tax Act, Union Minister of Finance Nirmala Sitharaman, section 80CRepresentative Image

Manpasand Beverages Ltd Chairman and Managing Director Dhirendra Singh is willing to step down from his day-to-day operations at the company if the situation arises, the company announced in a BSE filing. The notification signed by Dhirendra Singh also said that the CMD is reviewing the developments in the company along with public shareholders. Manpasand Beverages got embroiled in Rs 40 crore GST fraud allegations recently, which also resulted in the arrests of its top officials. The FMCG company is now in talks with EY to advise and guide Manpasand Beverages in the matter.

Dhirendra Singh expressed his willingness to take necessary actions in the best interest of the company. Earlier on 23 May 2019, search and seizure proceedings were carried out on various premises of the company, followed by a formal inquiry on 24 May at GST Bhavan office of Vadodara. The search was conducted by the Commissioner of Central GST and Customs. In the investigation, a network of more than 30 fake units was located in various parts of the country. These were used for committing fraud by availing illegal credit, the investigation unearthed. The beneficiary of the fraud and web of shell companies are also being investigated.

Manpasand Beverages Director Abhishek Singh, his brother Harshvardhan Singh, and CFO Paresh Thakkar were arrested as they were found guilty of tax evasion through dummy companies. The company is contesting the allegations, it had earlier said. Several employees resigned after the news surfaced including independent directors Chirag Doshi, Bharat Vyas and Milind Babar. Manpasand Beverages Ltd, which has a market capitalisation of Rs 1,200 crore, witnessed a massive plummet in its stock after 24 May.

“The stock has fallen nearly 60 per cent since May 24. The shares of the company Thursday touched its 52 weeks low and its lower circuit limit of Rs 44.15, down 4.95 per cent on BSE,” PTI reported.

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