Fraud-hit CG Power ’s Chief Executive Officer KN Neelkant has resigned from all the subsidiaries of the company.
Sources in the company that BusinessLine spoke to confirmed the development.
This comes after the board of CG Power & Industrial Solutions removed its founder Gautam Thapar as Chairman following an investigation which alleged that money was siphoned off from the company. Thapar has refuted these allegations. This was followed by the sacking of CFO VR Venkatesh.
Also read:CG Power reports massive fraud
Industry sources said that this resignation paves the way forward for current lenders and prospective investors.
“A clean-up is required and the money trail needs to be tracked,” said a source.
On May 10, CG Power’s board had sent Neelkant on leave pending an investigation into some suspect, unauthorised and undisclosed transaction.
The board informed stock exchanges that an investigation by an independent law firm had found that some employees had carried out unauthorised transactions, which led to a potential understatement of not only the liabilities of CG Power but even advances to related and unrelated parties of the company and the group.
CG Power disclosed that the advances to related and unrelated parties have been potentially understated by ₹1,990.36 crore and ₹2,806.63 crore, respectively, as on March 31, 2018.
Sources also added that Neelkant had abstained from voting on the resolution to remove Thapar as the company’s Chairman on August 29. The board has ordered a forensic investigation in the entire matter.