Manpasand Beverages (MBL) shares were on Monday locked in lower circuit, down 20 per cent at Rs 88, on the BSE, with huge sell orders on the counter, after the company’s top management was arrested in a Rs 40 crore Goods and Services Tax (GST) fraud case.
Till 09:23 am, a combined 77,637 shares had changed hands on the NSE and BSE, while there were pending sell orders for 12.48 million shares, representing 11 per cent of total equity of MBL, the exchanges data shows.
“The Commissioner of Central GST and Customs has carried out search and seizure proceedings at various premises of the Company on May 23, 2019, and further inquiry was conducted on May 24, 2019 at GST Bhavan office of Vadodara,” MBL said on Saturday in a regulatory filing.
Abhishek Singh, whole time director, Paresh Thakkar, chief financial officer of the Company and Harshvardhan Singh are under judicial custody of Authority on yesterday, i.e., May 24, 2019, it said.
The company said it is contesting these allegations in accordance with the due process of law. Considering the present status of the case estimated impact on the company and amount involved is not identifiable till the outcome in the matter.
As per a CGST Commissionerate statement, the listed beverages company had been running fake units for availing input tax credit (ITC) fraudulently, committing a tax evasion of Rs 40 crore, involving a turnover of Rs 300 crore.
In a separate regulatory filing, MBL informed the stock exchanges that Vishal Sood, non- executive director of the company has tendered resignation from the post of Director of the company with immediate effect i.e. 24th May, 2019. This resignation is mainly due to search from GST departmental, it said.