Religare files criminal complaint with EOW against promoters Singh brothers

Religare Enterprises Ltd (REL) Wednesday said its subsidiary Religare Finvest (RFL) has lodged a criminal complaint with the Economic Offences Wing of the Delhi Police against promoters Malvinder Mohan Singh and Shivinder Mohan Singh.

The complaint also names REL ex-CMD Sunil Godhwani, among other directors, for cheating, fraud and misappropriation of funds to the tune of Rs 7.4 billion.

"Religare Finvest, a subsidiary of Religare Enterprises has filed a criminal complaint with the Economic Offences Wing of the Delhi Police against the promoters of REL Malvinder Mohan Singh and Shivinder Mohan Singh as well as REL's former CMD, Sunil Godhwani, N K Ghoshal, the directors and officers of the promoter entities and other unknown persons for various offences under the Indian Penal Code," REL said in a regulatory filing.

The complaint has been registered for various offences including cheating, criminal breach of trust, misappropriation, fraud and forgery and criminal conspiracy, REL said.

"The complaint was filed basis internal inquiries (including an independent forensic review) undertaken by the new RFL board and management," it said.

REL was controlled by the warring Singh brothers until February 2018.

Post their exit from the board of REL in February 2018, the boards of REL and RFL have been re-constituted.

Pursuant to reconstitution, the REL and RFL boards now consist of professionals widely recognised in their respective fields, who are unconnected to the promoters, it said further.

"The reconstituted boards have appointed a new professional management to manage the affairs of REL and its subsidiaries. Through the inquiries undertaken by the new RFL Board and management it has discovered siphoning and misappropriation of funds of RFL amounting to approx Rs 7.4 billions in aggregate through loans to entities that are controlled by, connected to or known to the promoters or their associates," REL said.

Earlier this month, the feud between the brothers took an ugly turn when they allegedly came to blows, following which the younger brother Shivinder said the incident had closed any possibility of them working together to resolve the issues.

The relationship between the Singh brothers, erstwhile promoters of Fortis Healthcare and Ranbaxy, went sour after allegations of fund diversion from the healthcare chain emerged.

It reportedly aggravated further over payment of arbitration award to Daiichi Sankyo. Shivinder had offered to pay his share of the Rs 35 billion award to the Japanese drug maker in a dispute related to the acquisition of Ranbaxy Laboratories.

Earlier in September this year, Shivinder had filed a petition before the National Company Law Tribunal (NCLT), alleging that collective and ongoing actions of Malvinder and ex-Religare chief Sunil Godhwani led to a systemic undermining of the interests of companies and their shareholders.