Court refuses to absolve ex-DHFL director in cheque bounce case | Mumbai news - Hindustan Times
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Court refuses to absolve ex-DHFL director in cheque bounce case

Apr 30, 2023 12:20 AM IST

Former non-executive director of DHFL, Srinath Sridharan, has been refused discharge from a cheque bounce case initiated by IDBI Bank. DHFL had obtained various credit facilities to the tune of INR150 crore ($20.3m) from IDBI Bank, and it was alleged that Aadhar Housing Finance, a DHFL group company, also availed credit facilities from the complainant bank. The cheque was returned due to a difference in signature, and the bank subsequently initiated proceedings against DHFL and its directors, including Sridharan.

MUMBAI: The sessions court on Wednesday refused to discharge Srinath Sridharan, a former non-executive director of Dewan Housing Finance Limited (DHFL), from a cheque bounce case initiated by IDBI Bank.

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DHFL had obtained various credit facilities, including cash credit facilities to the tune of 150 crore from IDBI Bank. It was alleged that Aadhar Housing Finance Limited (AHFL), a group company of DHFL, also availed credit facilities from the complainant bank.

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The promoters of AHFL—Wadhwan Global Capital Ltd, (WGCL) and DHFL—agreed to sell their shareholding in AHFL to a private equity fund. The AHFL had on February 14, 2019, requested the complainant bank to issue a no-objection certificate (NOC) for change in ownership of AHFL. The bank issued a NOC letter dated May 23, 2019.

As per the deal, the company was required to give the bank post-dated cheques to close the credit accounts. The bank claimed that in spite of several intimations, DHFL failed to clear the dues. Hence, the bank deposited a cheque for 98.90 crore. The cheque was returned on account of the difference in signature.

Hence, the bank subsequently initiated proceedings against DHFL and its directors namely—Kapil Wadhawan, Dheeraj Wadhawan, Alok Mishra, Sunjoy Joshi, Dr Deepali Pant Joshi and Sridharan. The court, after taking cognisance of the bank’s complaint, issued proceedings against the company and its directors.

However, Sridharan challenged the proceedings before the sessions court, stating that his role was not specified in the complaint and the cheques were issued before he was appointed as a non-executive director of the firm. The cheque was issued not for the company’s liability but for a transaction of a sister concern, he claimed.

The date of appointment of Sridharan was March 26, 2019. The request for the NOC to the complainant bank was given on February 14, 2019. He further claimed that he was not involved in the day-to-day affairs of the company.

The bank, however, claimed that he was in the realm of affairs of the company, and thus this became a triable issue.

“Obviously, onus can be discharged by the accused at an appropriate stage of the trial. The revision application against issuance of process cannot be a permit for the accused to absolve from liability to discharge such onus, specifically legislated in the form of presumptions in the Negotiable Instrument Act,” the court said while refusing to grant relief to Sridharan.

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