Mahindra Satyam on Tuesday said it has received legal notices for claims totalling Rs 1,230.40 crore from 37 firms floated by its founder, Mr B. Ramalinga Raju. The company, however, rejected the claims as “legally untenable”.
“Mahindra Satyam has received legal notices from 37 companies claiming a refund of Rs 1,230.40 crore, allegedly given as a temporary advance,” the US-listed Indian IT major said in a regulatory filing with the US regulator Securities and Exchange Commission (SEC). The notices pertain to the money that Mr Raju, claimed to have “arranged (borrowed) for the company from the 37 companies.” The investigation, however, revealed that all the lenders are the front companies floated by Mr Raju from 2005 to 2007.
“The notices claim the money back to allegedly repay their creditors, some of whom include Maytas Properties and Maytas Infra,” said the company. In reply, Satyam said it has sent legal notices on November 14 stating that the claims are legally untenable.
According to sources, the company had got notices in October but auditors have not found any entry in the books with regard to the money allegedly lent by Mr Raju’s front companies. Until Mr Raju revealed his fraud, the company was officially known as a zero-debt company.
The CBI chargesheet, however, claims: “It is revealed that an amount of Rs 1,425 crore out of the above said loans obtained from various NBFCs (non-banking finance companies) was transferred to the bank accounts of SCSL (Satyam Computer Services Ltd) by 37 among the 327 companies as a loan over a period of time ranging from November 17, 2006 to October 30, 2008, to meet the expenses of SCSL (Satyam Computers). Out of this amount, an amount of Rs 194.6 crore was returned by SCSL during the months of October and November 2008 to 15 out of the above 37 companies.”
Currently, the company is restating its accounts, which is expected to completed by June 2011. The sources said the company has already replied to the NYSE’s delisting notice seeking more time.
On June 9, Satyam had disclosed a total of about Rs 10,000 crore in legal and other claims. Besides Rs 1,230 crore sought by 37 ‘unacknowledged’ creditors, these included claims worth about Rs 400 crore related to four overseas acquisitions made under the leadership of Mr Raju.
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