The allegations of fund diversion and preferential transactions by Reliance Communication as carried by the Economic Times newspaper is illogical and baseless and is strongly refuted and denied, said the company’s spokesperson.
People in the know told The Economic Times that an SBI-commissioned probe has flagged transactions worth Rs 5,500 crore in the books of these companies after examining over 100,000 entries between May 2017 and March 2018.
The country’s largest bank had engaged accounting firm Binder Dijker Otte (BDO) in November 2017 to study the fund flows between these entities. “A deeper analysis showed that these were just adjustment entries made by the company. An in-depth investigation is needed to track the flow of these funds,” reported ET quoting sources. The report has been tabled before the committee of creditors and questions thrown up by the findings have already been raised with the management.
The spotlight of the probe is on a little-known entity called Netizen that had received capex advances of Rs 4,000 crore on May 20.
However, RCOM refuted the reports and said: “During the period of June 2017 to March 2018, RCOM was under the Strategic Debt Restructuring scheme of Reserve Bank of India and all the transactions were under the full scrutiny of lenders. The alleged report has not been discussed with management and its input is yet to be taken on record by BDO”.