Delhi HC orders investigation into AskMe's finances

The SFIO will submit a report on AskMe's finances by the end of this month, reports Tech in Asia

The battle between the board of Getit Infoservices – which operated popular e-commerce and listings website AskMe – and its majority investor Astro has reached a tipping point.

According to a court order reviewed by Tech in Asia, the Delhi High Court has directed the Serious Fraud Investigation Office (SFIO) to probe allegations of misappropriation of funds and company assets, a move that Astro has been lobbying for.

The SFIO will submit a report on AskMe’s finances by the end of this month. Malaysia-based Astro Entertainment Network (AENL) filed a petition in the Delhi High Court in December last year to close down Getit Infoservices, Tech in Asia had reported.

The court has also agreed to appoint a provisional liquidator to wind up the company that suspended operations in August last year.

A “winding up petition” is different from a bankruptcy filing. In bankruptcy, an entity or an individual can be given a fresh start, depending on the petition clauses. Bankruptcy is filed for when debts and liabilities are in excess of assets. Liquidation, on the other hand, refers only to companies, and means terminating all operations permanently. Not every company that’s liquidated is bankrupt.

Astro has invested over $300 million in Getit since 2010. Astro’s contention was Getit’s huge debt, which amounted to over $80 million. As of July 2016, AskMe recorded losses of $60.7 million.

The court has subsequently ordered all the directors of the company, including managing director Sanjiv Gupta, to submit their statement regarding the investigation in the next few days. 

The restrictions on the company directors was a response to Astro’s contention that the Getit board resorted to hostility and has repeatedly obstructed decision-making process regarding AskMe.

This is an excerpt from an article published on TechInAsia. You can read the full story here