Shri Narendra Modi
Hon’ble
Prime Minister of India
Prime
Ministers Office
Raisina
Hills
New
Delhi – 110 001
15th March
2016
Subject: Appeal to seek an appropriate
investigation into illicit banking and commercial relationship between Videocon Group of Venugopal Dhoot and ICICI Bank’s MD & CEO Chanda Kochhar’s family owned NuPower Renewable Group steered by her husband Mr. Deepak Kochhar for amassing wrongful personal gains deceiving
Stakeholders, Shareholders, Public / Private Sector Banks and Indian Regulatory
Agencies for unjust and illegal enrichment through corrupt banking practices within India and tax heavens by a high
level CBI/ED/SFIO/SEBI/the RBI team to ensure healthy private sector Banking.
Dear Mr. Prime Minister, Sir,
Being
a vigilant investor shareholder of the Videocon Group and the ICICI Bank, I am committed
to bring about transparency and good corporate governance for healthy
functioning of the Indian private corporate sector and the private sector Banks,
I am constrained to seek your kind intervention for preventing certain dirty
banking practices and illicit corporate dealings by persons interested in amassing
wrongful personal gains. This adds to the erosion of the corporate quality of
Bank Funded Assets.
Sir,
the fact that the Videocon Group led by Mr. Venugopal N. Dhoot has made hefty political contribution of Rs.
11.1 crore to the Bhartiya Janta Party’s (BJP) led Union Government during the year
2014, as against just Rs. 5 lakh in the previous year, should not deter the Government
to order an appropriate independent investigation to bring out the truth relating
to opaque corporate transactions and prevent impending banking crisis in the
ICICI Limited. The Videocon Group is heading deep into crisis and will soon become
drain on Banks as Non Performing Asset despite the ICICI Bank offering them murky
financial supports. This is a serious misgovernance issue and deservers your
intervention or else the reputation of the Government will get tainted.
Please
read this representation in conjunction with a detailed corporate dossier Annexed herewith (Annexure: 1– 22) detailing chronology of events relating to nexus
between the ICICI Bank CEO&MD specifically with Venugopal Dhoot of Videocon
Group.
The Dhoots
of Videocon Group have dubious business track record of pursuing Unfair Trade Practices
post economic reforms initiated by the Congress led UPA Government. The
Videocon Group has cheated and defrauded millions of small investors and State
Government Financial Institutions in Gujarat. In September 1992, the
undersigned acted as a whistle blower, and the Hon’ble MRTP Commission had then
stalled the public offering by the newly established Videocon Narmada
Electronics Limited (VNEL) public issue at a hefty premium circumventing the
then prevailing laws. VNEL - a JV with Gujarat Narmada Valley Corporation turned
sick and got merged with Videocon International Limited. The group has conned
million of small investors and amassed wealth manipulating the government and
judicial machinery to their advantage.
Through
this representation the undersigned is again blowing the whistle laud and clear
to seek your intervention in the matter to avert corporate fraud on investors and
the Indian private sector Banks. Over the past two decades the Videocon Group,
has spread business interests in India and overseas markets covering Consumer
Electronics, Oil and Gas Exploration, Telecom and Power sectors enterprise and
has established several oversea entities including tax heavens. The Group
fortunes have been sinking and the investors have lost money yet the promoters
have become wealthy by enjoying their proximity to the people who matter in
corridors of power.
You
may be shocked to know that the Videocon Group – led by the Videocon Industries
Limited – has a debt of Rs. 45,405 crore for the financial year (FY) 2014-2015
on books. Over the years the absolute debt levels have risen unabated despite
assets sales both partly due to ongoing capex but substantially due to operational
losses. The absolute debt levels have risen from Rs. 12,000 crore (Cr) in FY
2011 to Rs. 45,405 Cr as of December 2014. The Auditors have already reported
that the Videocon Group has made default of Rs. 1820 Cr during FY 15 in
repayment of debt of up to 360 days.
In
fact, the internationally reputed Research firm Credit Suisse in their famous report
entitled “House of Debt” released on
21st October 2015 has identified the Videocon Group as number 4th
largest Corporate as “House of Debt” under high financial stress in India. The
fortunes of Videocon Group rests on fresh borrowing to service mounting debts. Now
the survival of the Group precariously depends upon Dhoots brother’s ability to
obtain sweetheart deals from their bankers for bail out dealings. The ICICI
Bank has fallen pray to their design.
Under
a premeditated conspiracy the Videocon Chief Venugopal Dhoot incorporated a Joint Venture business
enterprise with Deepak Kochhar – husband
of the CEO&MD of ICICI Bank Ms. Chanda Kochhar way back on 24th
December 2008 in the name of NuPower
Renewables Private Limited as 50:50 joint venture (JV). The NuPower
Renewables is a JV between Venugopal Dhoot and his brother Rajkumar Dhoot and
Deepak Kochhar along with his wife and his financial services company – Pacific Capital Services Private Limited
established in 1999 – where Ms. Chanda Kochhar is the ultimate financial
beneficiary of the Joint Venture with the sinking Videocon Group.
RISE OF KOCHHAR’S OWNED JOINT VENTURE – NUPOWER
RENEWABLES LIMITED FUNDED BY THE VIDEOCON GROUP CHIARMAN VENUGOPAL DHOOT:
In December 2008, Venugopal Dhoot and
Kochhar’s family conspired and incorporated a private joint venture company named
NuPower Renewables Private Limited in Mumbai wherein both the Videocon Group
Chief Venugopal Dhoot and the family of Chanda Kochhar – her husband and
father/sister-in-law owned 50:50 joint equity ownership.
The
first Directors of the NuPower Group included:
1.
Mr. Venugopal N. Dhoot
2.
Mr.
Deepak V. Kochhar
3.
Mr. Saurabh P. Dhoot.
The list
of initial subscribers of the NuPower were the Dhoot brothers family including
Venugopal Dhoot, Saurabh Dhoot (son of Venugopal’s brother Pradeep Dhoot),
Rajkumar Dhoot and Deepak Kochhar and Kochhar’s owned Pacific Capital Service
Private Limited. The Pacific Capital Services Private Limited then was owned 90% by Mrs. Neelam Advani (wife of Mrs. Chanda Kochhar’s brother
Mahesh Advani) and 10% by Mr.
Virendra Kochhar (Father-in-law of Mrs.
Chanda Kochhar).
Mrs.
Chanda Kochhar was ICICI Bank’s Joint MD & Chief Financial Officer (CFO)
till early 2009. In May 2009 Chanda
Kochhar became the CEO & MD of ICICI Bank Limited.
Upon
Chanda Kochhar becoming CEO & MD the identity and ownership of the NuPower Renewables Private Limited was masked by
transferring the shareholding to “Pinnacle Energy” (A Trust) where Mr. Deepak Kochhar the husband of Chanda
Kochhar is the Managing Trustee. As per the Valuation Report doctored by
the E&Y dated 10th December 2014 the shareholding pattern of the
NuPower Renewables Private Limited as at 31st March 2014 constituted equity
ownership as 92.7% with Pinnacle Energy (A Trust) with Mr. Deepak Kochhar as
Managing Trustee and Other owned 7.3% shares in the NuPower.
In June 2009, after Chanda Kochhar became the CEO & MD
of the ICICI Bank laired transfers were carried out to mask the true identity of
the NuPower Group. Both the group of shareholders namely, Venugopal Dhoot and
his family and Pacific Capital Services Private Limited owned by Kochhar’s transferred their shareholding in
NuPower Renewables Private Limited to Supreme
Energy Private Limited (Supreme Energy). The Supreme Energy is essentially
a shell company fully owned by Venugopal Dhoot only to effect shoddy private
financial transactions.
The
rise of the NuPower Renewable Private Limited funded by the Videocon Group became
more significant when in the 2009-2010 the
Supreme Energy funded NuPower Group by Rs. 64 crore by subscribing to its
zero coupon fully convertible debentures since:
(i)
Supreme Energy owned by Venugopal Dhoot funded
Rs. 64 crore by way of extending unsecured loans which it borrowed from one of
the listed company owned by Videocon Group,
(ii)
Subsequently, Supreme Energy surreptitiously
converted this loan belonging to the small shareholders of Videocon Group into
zero coupon optionally convertible debentures. However, in violation of the
laws, the details of the debenture holders have not been disclosed either in
the Annual Return or in the accounts filed with Registrar of Companies, which
is a mandatory requirement.
The
Annual Reports filed by the NuPower Group reveals that the funds received by
the Supreme Energy from the Videocon Group were utilized to purchase the Wind
Energy Generators. As a result a finance company owned by Chanda Kochhar’s
family became a Wind Energy generation company styled as – NuPower Renewable
Private Limited.
Further,
In March 2012, NuPower further
allotted 18,97,500 equity shares of Rs. 10 each, aggregating Rs. 1.89 crore to
Deepak Kochhar and 1,00,000 equity shares of Rs. 10 each to Sunil Bhuta (the
CFO of NuPower Group). As a result of this allotment, Deepak Kochhar acquired
substantial stake of 92.67% of diluted equity share capital in NuPower
Renewables Private Limited and the Supreme Energy got reduced to minority
holding of 2.32% and the rest is held by their employees. It is pertinent to
note, while the Venugopal Dhoot of Videocon Group invested Rs. 64 crore through
the Related Party in NuPower Renewables, its shareholding in NuPower got reduced
to just 2.32%, whereas just with the investments of only Rs. 1.89 crore Deepak Kochhar acquired 92.67 % stake in
NuPower Renewable Private Limited.
Interestingly,
in March 2012, itself shares of
NuPower Renewables Private Limited (NRPL) held by Deepak Kochhar were
transferred to Pinnacle Energy (A Trust) whose managing Trustee is Deepak
Kochhar himself. The present shareholding structure (as of 31st
March, 2015) of NuPower Renewables Private Limited is as under:
Name of the shareholder
|
No. of shares
|
% Holding
|
Pinnacle Energy (a
Trust) through
Its Managing
Trustee Deepak Kochhar
|
1,897,500
|
92.67
|
Deepak
Virendra Kochhar
|
2,500
|
0.12
|
Supreme
Energy Private Limited
|
47,496
|
2.32
|
Mahesh
Chandra Pungalia (employee of Videocon Group)
|
1
|
0.00
|
Sunil
Bhuta
|
100,000
|
4.89
|
Shruti
Sunil Bhuta
|
1
|
0.00
|
Bhupinder
Singh Bajaj
|
1
|
0.00
|
Prem
Rajani
|
1
|
0.00
|
DH
Renewables Holdings Ltd, Mauritius
|
1
|
0.00
|
Total
|
2,047,501
|
100.00
|
The
E&Y Merchant Banking Services – a subsidiary of the Ernst & Young LLP
valued the enterprise value of NRPL as at 31 March 2014 at Rs. 1092 crore! The
role of Merchant Banking arm of accounting giant E&Y becomes questionable
for over valuing the NRPL.
QUID PRO QUO DEAL BY CHANDA KOCHHAR’S ICICI
BANK LED DIRTY DEALINGS WITH VENUGOPAL DHOOT IN SAVING VIDEOCON GROUP FROM DEBT
DEFAULTS:
Once
again, during the Congress led UPA government the ICICI Bank headed by Chanda
Kochhar extended sweetheart funding to the Videocon Group both in India and
abroad through companies established in tax heavens like the Cayman Ireland and
Mauritius.
In April 2012, just after complete
transfer of ownership and control of NuPower Renewables to Kochhar’s family the
ICICI Bank extended Rupee loan to various private companies belonging to the
Videocon Industries Limited to the tune of Rs. 3,250 crore as per the break-up
given below:
Rupee Loan of Rs. 3,250 crore to the Promoters of Videocon Group by
ICICI Bank
Name of the Company
|
Date of ICICI
Bank funding
|
Amount of loan in Rs. Crore
|
Trend Electronics Limited
|
30.04.2012
|
650
|
Century Appliances Limited
|
30.04.2012
|
650
|
Kail Limited
|
30.04.2012
|
650
|
Value Industries Limited
|
30.04.2012
|
650
|
Evans Fraser & Company
India Limited
|
30.04.2012
|
650
|
Total
|
3,250
|
In
addition, the helping hands of the ICICI Bank extend overseas destinations as
well. The ICICI Bank extended offshore funding amounting to Rs. 660 crore to another foreign entity owned
by the Videocon Group.
A Videocon
Group Company based in Cayman Islands namely Tuskar Overseas Inc. was also
funded by ICICI Bank Ltd through its UK and Canada branches with a massive sum
of Rs. 660 Crore. The said offshore loan was backed by guarantees given by six
Indian Videocon Group firms including Tek Care India Pvt. Ltd, Shree Dhoot
Trading and Agencies Ltd, Value Industries Ltd and Trend Electronics Ltd.
Sir,
round tripping foreign investments in Indian corporates has been a subject of
curious investigation to unearth host of scams perpetrated by the Congress led
UPA Government. It is against this background that the Bank funding provided by
the ICICI Bank to Videocon Group assumes significance. The above said banking transaction
reflects a deep-rooted conspiracy on the part of ICICI Bank’s lending
arrangement with the Videocon Group. Such transactions constitute Indian
private sector Banking scam.
Evidently,
Mrs. Chanda Kochhar facilitated this unscrupulous domestic offshore funding in
abuse of her position as the CEO & MD. Chanda Kochhar’s greed of making
private gains by corrupt means has resulted in wrongful losses to the ICICI
Bank and the ICICI Bank’s future is in a precarious financial condition. There
are - serious risk of sticky loans
extended to groups like the Videocon promoted by Venugopal Dhoot becoming NPA’s
with the ICICI Bank. Mrs. Chanda Kochhar’s actions are in conflict with the
interest of the ICICI Bank and deserve to be strictly dealt with by the RBI.
Furthermore,
during the period between December 2010 and March 2012, NuPower Renewables also
received large overseas funding’s aggregating to Rs. 325 crore in the form of
compulsorily convertible preference shares (CCPS) from an obscure Mauritius
based entity named Firstland Holdings Limited. Later in 2014, the above funding
was shifted to another Mauritius based entity named DH Renewables Holding
Limited.
In
December 2014, a further sum of Rs. 66 crore was funded by the same entity DH
Renewables Holdings Limited, Mauritius. DH Renewables Holdings Limited,
Mauritius is wholly owned subsidiary of Accion Diversified Strategies Fund SPC,
a company incorporate in Cayman Islands and having its head office in
Singapore. It needs to be investigated
whether the funding to Renewable Holdings from Mauritius have any corporate
clients of ICICI Bank link with the Kochhar’s owned NuPower Renewables Private
Limited.
A
careful evaluation of the information dossier attached compiled from the
available published sources and information available in public domain leads to
disquieting inferences. A corrupt nexus
between the ICICI Bank’s Chief Chanda Kochhar dealings with the Videocon Group
Chief Venugopal Dhoot and his family is well established.
Videocon Group gifted the remaining equity
stake held by Supreme Energy in NuPower Renewables Private Limited to Deepak
Kochhar’s Pinnacle Energy.
On 29.09.2012, after the disbursement
of loans of Rs. 3910 Crore (3250 + 660) by ICICI Bank to various firms of the
Videocon Group. The Group also transferred the ownership of Supreme Energy to
Deepak Kochhar’s Pinnacle Energy (A Trust). Thus Deepak Kochhar became absolute
owner of NuPower with 95.11% equity stake. With the generosity of Videocon
Chief Venugopal Dhoot the NuPower Group is under complete beneficial ownership
of the ICICI Bank Chief & MD Mrs. Chanda Kochhar. This is serious abuse of
authority and deserves to be thoroughly probed to protect the interests of the
ICICI Bank’s stakeholders and save the Bank from sub prime assets.
In
the light of above submissions the Government should institute an investigation
by the CBI / SFIO / ED / SEBI / RBI etc. into the corporate banking affairs of
the ICICI Bank and its corrupt dealings with the Videocon Group and other leading
sticky Corporate Houses bank dealings with the ICICI Bank under the Prevention
of Corruption Act.
Therefore, In order to protect the health of
our banking institutions and in the interests of millions depositors of ICICI
Bank and to safeguard investors money, may I again request that a high-level
anti-corruption investigation by CBI/ED/ SFIO/ SEBI and the RBI may please be
ordered in the matter to avert corporate bankruptcy of private sector Bank like
the ICICI Bank and corporate collapse of the Videocon Industries Limited before
its is late.
The Hon’ble
Supreme Court Bench headed by Justice Ranjan Gogoi and
Justice PC Pant have held that all officials of a private bank operating under
the license issued by the Reserve Bank of India are to be defined as public servants under the Prevention of Corruption Act
and be prosecuted like the public servants for corrupt practices. The Government committed to transparency and good governance must
act accordingly.
Thanking
you in anticipation of a prompt action in a matter of great public importance.
Yours
sincerely,
(ARVIND GUPTA)
E-mail:
trust_arvind@yahoo.com
Mobile:
9871798080
Shareholder
Folio No: 479887 (VIL)
Client
Id: 10778640 (ICICI Bank)
CC: Mr. Arun Jaitley
Union Minister of
Finance and Corporate Affairs
Ministry of
Finance, North Block,
Raisina Hill, New
Delhi 110011
Dr. Raghuram Rajan
Governor,
Reserve Bank of India
Central Office Building, 18th Floor,
Shahid Bhagat Singh Road, Mumbai 400 001
Mr. UK Sinha
Chairman,
The Securities and Exchange Board of India
Plot No.C4-A,'G' Block, Bandra Kurla Complex,
Bandra (East), Mumbai 400051
Mr. K V Chowdary
Central Vigilance Commission
Satarkata Bhavan, A-Block
GPO Complex, INA
New Delhi - 110 023
Mr.
Anil Kumar Sinha
The Director
Central Bureau of Investigation
Plot No 5-B, CGO Complex,
Lodhi Road, New Delhi-110003
Mr. Karnal Singh
Director
Enforcement Directorate
6th Floor, Lok Nayak Bhawan
Khan Market, New Delhi 110003
Shri P.K. Tiwari
Director, FIU-IND
Financial Intelligence Unit - India
6th Floor, Hotel Samrat
Kautilya Marg, Chanakyapuri
New Delhi -110021, India
Financial Intelligence Unit - India
6th Floor, Hotel Samrat
Kautilya Marg, Chanakyapuri
New Delhi -110021, India
Mr. Ratan Watal
Finance
Secretary & Secretary (Expenditure)
Room
No. 128-A,
North
Block, New Delhi 110001
Dr. Hashmukh Adhia
Secretary Revenue
North Block, New Delhi
110001
Mr. Najib Shah
Director General
Department of Revenue Intelligence
7th Floor, D Block,
I.P.Bhawan,
I.P.Estate, New Delhi
Mr. Nilimesh Baruah
The Director
Serious Fraud Investigation Office
Ministry of Company Affairs, 2nd Floor, ‘B’
Wing,
Paryaveran Bhawan,
CGO Complex, Lodhi Road,
New Delhi, 110003
