NEW DELHI: An unsettling experience with the first insolvency verdict where someone related to the defaulting promoter of an auto components manufacturer managed to grab the company at dirt cheap price provided the trigger for the government to seal the opening for a repeat of similar sleighs which, along with a fraud on the exchequer, could have been “politically indefensible” too.
In August, alarm bells rang in the government when National Company Law Tribunal (NCLT) allowed Synergies Castings to acquire Synergies-Dooray Automotive, which made and supplied aluminium alloy wheels for Rs 54 crore when the company owed Rs 900 crore to lenders. The company was allowed to pay Rs 20 crore upfront with the rest over five years.
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