Hyderabad-based financial services firm Karvy Group has filed a complaint against the promoters of Deccan Chronicle Holdings Limited (DCHL) late on Tuesday alleging, among other things, forgery and misrepresentation. Karvy representatives lodged the complaint with the city police, invoking provisions under Sections 420 (cheating), 406 (criminal breach of trust), 458 (wrongful restraint) and 471 (passing off forged documents as genuine) read with Section 34 (acts done by several persons in furtherance of common intention).
The case was filed against DCHL Chairman T. Venkataram Reddy and Vice-Chairmen T. Vinayak Ravi Reddy and P. K. Iyer. The Karvy group filed the complaint accusing DCHL of providing misinformation to third party, and introducing forged documents in its name.
The case comes close on the heels of a petition filed by IFCI in the Andhra Pradesh High Court seeking liquidation of Deccan Chronicle, alleging that the media house had huge liabilities . As it was sceptical of the financial health of the company, IFCI sought appointment of a liquidator for winding up DCHL to recover its dues.
The IFCI case pertains to issuance of non-convertible debentures (NCD) by the DCHL through IDBI in which IFCI had invested about Rs.25 crore through 250 NCDs. The NCDs, carrying a coupon rate of 11.25 per cent, were to mature in June last week, but IFCI alleged in its petition that DCHL had defaulted in repaying the redemption amount. The case is pending hearing before the High Court. Promoters of the company, who had pledged 11.28 crore shares, forming 54 per cent of the equity capital with Future Capital Holdings Ltd to raise funds, have pledged an additional 14.46 per cent stake with Religare Finvest. DCHL’s share price continued its slide to touch a new low of Rs.13.95, down from Tuesday’s Rs.15.45.