Singapore-based multinational bank DBS has registered a complaint with Ulsoor police station against Bengaluru-headquartered Opto Circuits (India) Limited, a medical technology company, alleging the latter defaulted on a Rs 178 crore loan & also falsified information in its audit.
DBS alleged that the firm, which is an export-oriented company, provided wrong information to the Securities & Exchange Board of India (SEBI), income tax department & other regulatory bodies in India. 9 people, including the company’s founder Vinod Ramnani & chartered accountant BV Swamy, have been named as accused.
News Agency, which has accessed the complaint copy, contacted Opto Circuits by email but is yet to get a response.
Police said they have issued notices to the accused directing them to appear for questioning. The bank has submitted all the relevant documents, cops added.
The complaint was filed by Nitin Parmar, an employee at DBS’ Mumbai branch in Nariman Point. He said the cheating was unearthed when bank officials went through the audited copies of the bank balance sheet for 2015-2016.
“The firm’s auditor had intentionally hidden the fact that there was a mammoth bank loan against the firm. The balance sheet had no mention of the loan taken during 2008. When we checked, we discovered the firm had told its investors they had repaid the full loan by selling a property in Singapore. This was a false claim. Similarly, the same balance sheet was submitted to Securities & Exchange Board of India (SEBI) & the I-T department,” the complainant said.
“...With an intention to cheat, auditor BV Swamy intentionally hid the fact that the firm had a loan of Rs 178 crore in the annual balance sheet. It proves the auditor & other accused, with a common interest, cheated the bank,” the complaint reads.
The complaint said as on 31 July 2016, the outstanding amount was Rs 178 crore & that an Early Warning Signal (EWS) circular was issued by the Reserve Bank of India on a framework for dealing with loan frauds. DBS bank classified the account of the accused company as a ‘red-flagged account’.
Opto Circuits (India) Limited then obtained an ex parte interim order in 2017 restraining the bank from further recourse for recovering outstanding dues. But DBS in its complaint said the order was vacated by the court next year.
In their annual report of 2018-19, Opto Circuits (India) Limited claimed the company along with its subsidiary (Cardiac Science Corporation) had borrowed funds from DBS Bank Ltd.
In 2014-15, the loan was restructured & as a part of the process, a sum of Rs 12,678 lakh borrowed by the company was also restructured. As per terms of the agreement with DBS Bank Ltd, upon default by the subsidiary (Cardiac Science Corporation), the bank exercised its rights & assigned the debts to a 3rd party & exercised proxy voting rights to take management control of the company.
As a result of this, according to Opto, the loan of Rs 12,678 lakh stands extinguished. DBS Bank has objected to the company’s stand.
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