Chanda Kochhar Money Trail: A Modern tale of deceit

It is said that if you dress cronyism as a favour, then you wind up on skid row. Equally, sorrows don't come individually but in battalions. The tale of Chanda Kochhar and her husband Deepak intertwining their fate and destiny with Videocons Venugopal Dhoot leaves behind in its wake a smoking gun which refuses to go away from the scene of the crime. At every twist and turn in this long running soap which resembles the cult pulp soap Dynasty, Videocon and Dhoot turn up like a sugar daddy to sign off on sweetheart deals.

Three dubious shell cos find convergence as major investors in both the Credential Finance companies (CFL 1 & CFL 2) floated and owned by the Kochhar brothers - Deepak and Rajiv - as discovered by IANS in its detailed investigation earlier in the series. Modern Fashions, KG Computers and ABS Components. Curiously, Modern Fashions Pvt Ltd was struck off in the wake of demonetisation. Let us examine the Modern Fashions paper trail in government records.

CFL balance sheet reveals that Modern Fashions as on September 30, 2000 invested ₹1.20 crore in preference shares and ₹37.43 lakh in equity shares of CFL, a total of ₹1.57 crore. Again, it emerges that there are two companies named Modern in the mix, just like there are two Credentials. Modern Fashion Pvt Ltd registered in Delhi (U18101DL1988PTC031753) and Moderne Fashions Pvt Ltd registered in Kolkata (U51909WB19 92PTC056997), which subsequently changed its name on MCA's website to Modern Fashions Pvt Ltd (U51909WB1992PTC56997), hitherto Modern Kolkata, a bonafide company not owned by Kochhars.

Modern Kolkata was incorporated on November 17, 1992 with its registered office as 9 Dacres Lane, Flat No 17, 2nd Floor, South Block, Kolkata 700069 by Vivek Himatsingka and Vishal Himatsingka. That is where the similarity ends.

Modern Kolkata seems bonafide with no connections to Kochhars. It files its returns regularly and appears to be completely genuine. Meanwhile, Modern Delhi was incorporated by Anjali Garg and Kamla Garg on May 19, 1988 with ₹1,000 as authorised capital, its registered office is B 33 SFS House, Sheikh Sarai 1, New Delhi 110017.

Sometime in FY 2003-04, Modern Delhi surfaced on the radar as it filed its returns, showing a loss of ₹7,680. RoC (Registrar of Companies) documents show that Rajiv Kochhar entered the company as a minority shareholder and took over its directorship on October 1, 1994. Majority shareholding was with Credential Holdings Pvt Ltd which was incorporated along with elder brother Deepak for ₹200 on September 8, 1994. This is where Chanda Kochhar's brother-in-law Rajiv pops up.

Over time, Modern Delhi's authorised capital ramps up from ₹1 lakh to ₹1.55 crore on 4.10.1995. But the company's paid up capital is shown as ₹1.78 crore in the returns filed in 2003-04 and 2004-05. This company is shown as "struck off" at serial number 13422 out of a total of 24,945 companies that were struck off by RoC Delhi on September 1, 2017 in their continuing action against errant companies after DeMo.

Now comes the Videocon link, in its returns for 2002-04, the company has shown an unsecured loan of ₹1.05 crore. Further, it has stated that it made an investment of ₹56.17 lakh (at cost) in buying 48,000 shares of Videocon International Ltd.

Modern Fashions owned 120,000 shares in CFL 1, while it held 374,300 shares in CFL 2. This is where the convergence sets in. Interestingly, Form 18 also shows how the address of this company has changed. First it was 33 SFS Flats Pocket B, Sheikh Sarai, New Delhi 17 and then it was changed to UB-5 Arunachal Bhawan, Barakhamba Road, Connaught Place, New Delhi, effective 20.3.2006. When visited, the Barakhamba Road address is clearly that of a suitcase company for it is just a hole in the wall, with no sign of life. Here again there is a major discrepancy where the physical copy of Form 18 and the online copy of Form 18 show different addresses.

Physical copy shows Modern Delhi's registered office as 24 School Lane, opposite Holiday Inn, Barakhamba Road, New Delhi-1, to UB 5 Arunachal Bhawan, Barakhamba Road, New Delhi-1. Which is at odds with the Sheikh Sarai address.