Companies

Corporate Affairs Ministry moves NCLT to recover ₹2,320 cr siphoned off by Amtek Auto promoters

Suresh P. Iyengar | | Updated on: Feb 22, 2022
B:LINE: DELHI BASED AMTEK GROUP CURRENTLY MANUFACTURING AROUND 31 COMPONENTS WHICH INCLUDES COVER TRANSMISSION CASING. SUPPORT TOP LINK, REAR OVER, GEAR SHIFTER FORKS, POWER LIFT POSITION RODS, POWER LIFT INSIDE ARMS, ACTUATING BLOCK COLLER ECT. FOR AUTOMOBILES.IT HAS STORNG PRESENCE IN THE TWO-WHEELER,PASSENGER CARS, TRACTORS AND THE C0MMERCIAL VEHICLES SEGMENTS . IT ENJOYS A MAJOR SHARE IN THE REPLACEMENT AND EXPORT MARKETS.IN THE DOMESTIC MARKET CUSTOMERS INCLUDES MARUTI UDYOG,DAEWOO MOTORS,HINDUSTAN MOTORS, BAJAJ AUTO, LML, KINETIC HONDA, TELCO, NEW HOLLAND, EICHER TRACTORS,MAHINDRA& MAHINDRA,ESCORTS ETC.  AMTEK HAS ALSO BEEN SELECTED AS A STRATEGIC SUPPLIER FOR NEW HOLLAND'S GLOBAL SOURCING PROGRAMME AND FRENCH TRACTOR JOHN DEERE.   AMTEK WITH 850 WORK FORCE HAVING 140 CRORE TURNOVER PIC--KAMAL NARANG

B:LINE: DELHI BASED AMTEK GROUP CURRENTLY MANUFACTURING AROUND 31 COMPONENTS WHICH INCLUDES COVER TRANSMISSION CASING. SUPPORT TOP LINK, REAR OVER, GEAR SHIFTER FORKS, POWER LIFT POSITION RODS, POWER LIFT INSIDE ARMS, ACTUATING BLOCK COLLER ECT. FOR AUTOMOBILES.IT HAS STORNG PRESENCE IN THE TWO-WHEELER,PASSENGER CARS, TRACTORS AND THE C0MMERCIAL VEHICLES SEGMENTS . IT ENJOYS A MAJOR SHARE IN THE REPLACEMENT AND EXPORT MARKETS.IN THE DOMESTIC MARKET CUSTOMERS INCLUDES MARUTI UDYOG,DAEWOO MOTORS,HINDUSTAN MOTORS, BAJAJ AUTO, LML, KINETIC HONDA, TELCO, NEW HOLLAND, EICHER TRACTORS,MAHINDRA& MAHINDRA,ESCORTS ETC. AMTEK HAS ALSO BEEN SELECTED AS A STRATEGIC SUPPLIER FOR NEW HOLLAND'S GLOBAL SOURCING PROGRAMME AND FRENCH TRACTOR JOHN DEERE. AMTEK WITH 850 WORK FORCE HAVING 140 CRORE TURNOVER PIC--KAMAL NARANG | Photo Credit: KAMAL NARANG

NCLT to hear the case on Feb 23

The Ministry of Corporate Affairs has asked the Serious Fraud Investigation Office to investigate the books and dealings of Amtek Auto with its group companies. The decision by the MCA was conveyed to NCLT Chandigarh demanding that the former promoters of Amtek Auto return ₹2,320 crore siphoned off from the company. The MCA’s petition to the NCLT comes up for hearing on February 23.

Funds diverted

The MCA said the amount was allegedly diverted by the former promoters to personal entities by way of loans secured through various banks. The investigations by SFIO is also likely to examine if there were short-comings in implementing the findings of E&Y’sforensic audit. In September last year, the MCA has approached the Mumbai Bench of the NCLT against the promoters and other former directors of Metalyst Forgings, a listed subsidiary of Amtek Auto, seeking an order to attach assets and disgorge the money of Metalyst Forgings from the promoter Arvind Dham, Chief Financial Officer Arun Kumar Maiti and Sanjiv Basin among others after discovering questionable financial transactions for ₹3,454 crore. Of this, there were questionable deals worth ₹2,320 crore, said sources.

Resolution professional

Interestingly, the same resolution professional was appointed to resolve all three companies led by the flagship company — Amtek Auto, Castex Technologies and Metalyst Forgings. Amtek Auto was one the largest auto component players of India with a large national and global foot print which supplied machines forgings and castings to automotive OEMs. Besides the flagshig Amtek Auto, the group companies Castex Technologies and Metalyst Forgings had borrowed ₹7,500 crore and ₹3,500 crore while other group companies had borrowed over ₹2,000 crore. In all, Amtek Group companies borrowed over ₹25,000 crore and defaulted on payments to banks. They were taken for insolvency proceedings and lenders appointed the same Resolution Professional to resolve all three companies.

Revival plan

Last November, lenders approved a revival plan submitted by the US-based hedge fund Deccan Value Investors for about ₹2,700 crore. The Amtek Group owes more than ₹13,000 crore to lenders and was among the 12 debt-laden companies initially taken to the NCLT as per Reserve Bank of India’s direction in 2017.

Published on February 22, 2022

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

COMMENTS
This article is closed for comments.
Please Email the Editor

You May Also Like

Recommended for you