MCA looking at BharatPe Board's conduct in Ashneer Grover controversy

Ashneer Grover last week resigned as company's managing director and director, says he will cooperate with ministry.

The Ministry of Corporate Affairs (MCA) is looking at the conduct of fintech unicorn BharatPe’s board in the Ashneer Grover issue, according to a source close to the developments.
 

Last week, Grover had resigned as the managing director and director within minutes of the agenda of a board meeting being set to discuss the alleged financial wrongdoings by his family.
 

“I haven’t (made a representation to MCA). But I’ll be pleased to cooperate with MCA as an Indian MD and shareholder who has been wronged,” the embattled founder said in a text message on Wednesday.
 

The company did not respond to Business Standard’s query seeking a confirmation on the developments.
 

In the week after Grover’s tumultuous exit, there have been questions on whether his shareholding of around 9 per cent in the company is entirely his own. According to reports, Grover and co-founder Shashvat Nakrani held some of third co-founder Bhavik Koladiya’s stake – and the board has taken the view that the co-founders have to sort out the issue amongst themselves.
 

However, Grover rubbished the reports. “It’s hilarious. You should go and ask the company one simple question. Did the board lie to the RBI (Reserve Bank of India) about shareholding?”
 

“I own all my shares. Who is Bhavik? I’ve got nothing to sort out with anyone. Maybe Sequoia is holding shares for someone — not me,” he retorted.
 

“...Bhavik is no one. I have a written representation to me from the Board that Bhavik is no one and does not even hold any ESOP (employee stock option plans) — leave aside equity,” Grover added.
 

Meanwhile, purported copies of Grover and wife Madhuri Jain’s income tax payments have emerged. According to the bank receipts reviewed by Business Standard, the duo has cumulatively made advance tax payments of Rs 8.2 crore for financial year 2021-22 (FY22).
 

Jain, who was earlier the head of controls at BharatPe, was fired last month by the company on allegations of wrongdoings.

Grover refused to comment on whether the tax receipts were genuine.
 

Asked whether he plans to sell his stake or stay put till an initial public offering (IPO), he told Business Standard: “It’s a function of how a company performs. It’s been two months of degrowth ever since I’ve been out of things. I’ll have to see business performance and new product launches as per timelines to have faith in holding stake here as against deploying my money elsewhere,” he added.
 

On Tuesday, Nakrani accused Grover of creating a false narrative about the company, and said the board acted quickly and decisively in unseating him after receiving the PwC report.
 

In a letter to employees, Nakrani said the Grover episode was an aberration and not the norm at BharatPe, and went on to defend the board, which consists of celebrated names in the banking and financial services industry, he said.
 

“Ashneer Grover, my co-founder, is no longer associated with BharatPe as an employee, a founder or a director of the company,” he wrote.