In a major development in connection with the ‘Masappadi’ (monthly payment) allegation against Kerala Chief Minister’s daughter Veena Vijayan’s (Veena T’s) company Exalogic Solution, the Registrar of Companies (ROC), Bengaluru has stated that the firm has not produced any document to prove that it has received money for the services rendered to from Cochin Mineral and Rutile Ltd. (CMRL).
An inquiry conducted by the ROC, Bengaluru found that no documents were submitted regarding CMRL’s advertisement for software services or any communication between CMRL and Exalogic before or after the transaction.
The inquiry report also states that neither Exalogic nor CMRL could present the contract details. In its reply to the Bengaluru ROC, Exalogic only explains that GST has been paid on the money received. The ROC found that Exalogic had not produced any evidence as to why it received the money.
The New Delhi bench of ITISB in June last found that T Veena’s firm, Exalogic Solutions received Rs 1.72 crore from CMRL for consultancy services that were never provided.
The Ministry of Corporate Affairs last week ordered a probe against the firm Exalogic Solutions for allegedly receiving payment from Cochin Minerals and Rutile Ltd (CMRL) without providing any service.
A three-member panel comprising Karnataka Deputy Registrar of Companies Varun BS, Chennai deputy director KM Sanker Narayan and Pondicherry registrar of companies A Gokulnath will conduct the probe. The inquiry panel has been asked to submit the report within four months.
Bengaluru ROC’s preliminary investigation report says action can be taken against Exalogic under Section 447 against fraud in company affairs and Section 448 against falsification of documents under the Companies Act 2013. These are sections punishable by imprisonment and a fine. The finding calls for an examination of the books of accounts of Exalogic and CMRL for further investigation.
CMRL also has a share of the state government. As per the Companies Act, the board must be notified when a related party transaction is entered into. However, the CMRL board was not informed of the transaction with the CM’s daughter’s company. This is a violation of Section 188.
The main argument of Chief Minister Pinarayi Vijayan and the CPM was that the Interim Settlement Board ordered without hearing Exalogic’s side. However, it is clear from the Bengaluru ROC’s report that despite the ROC seeking details, Exalogic could not produce a single document.