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    • Sep 29, 2023
    • 13 min read

Urging for Justice for the DHFL Victims: An Appeal to the Non-Godi Media

Posted on 29/09/2023 (GMT 08:50 hrs)

Compiled by Debaprasad Bandyopadhyay and Akhar Bandyopadhyay

We, the Dewan Housing Finance Corporation Limited’s (DHFL: an AAA-rated NBFC) FD and NCD Holders, are not at all surprised that all the Godi Media are reluctant to report⤡ the biggest financial scam in post-Independent India (before Hindenburg Report). However, we are surprised that very few non-Godi media have covered it as a “marginal” or unimportant matter.

Therefore, let us introduce to you the brief history of DHFL scam, for which the FD and NCD holders of the DHFL are suffering for the last three and a half years. We do not know the cause behind the non-coverage of the scam by the most of the Non-Godi Media.

I. ALL ABOUT THE DHFL SCAM


II. BACKGROUND OF THE DHFL SCAM: VICTIMIZATION OF FD AND NCD-HOLDERS

In a nutshell, the beginning of the narrative of the DHFL Scam is as follows:

In October 2019, all payments to the DHFL FD holders were stopped after Mr. Ambani, through his company Reliance Nippon Life Insurance, approached the Hon’ble Bombay High Court, which gave its verdict on 10/10/2019. Soon after the company was brought under the Insolvency and Bankruptcy Company (IBC, 2016 amended 35 times after the introduction of such code) in November-December 2019, the board of directors were removed and the Committee of Creditors (CoC) was constituted. A “simulated” bidding war started between 20+ corporate groups including Adani Group (who was more of a dummy/proxy bidder), Oaktree Capitals and Piramal Capital and Housing Finance Limited. All other bidders left the bidding one by one to pave the way for Piramal’s pre-determined acquisition.

NCLT’s verdict (19.05.2021) to reconsider the full repayment proposal of the erstwhile directors of DHFL was left unheard, and Piramal with the CoC got the order revoked within days at the NCLAT on 25.05.2021 (DOWNLOAD NCLAT-order-1) without answering the NCLT’s pertinent questions.

Moreover, after the said NCLT’s first order in May 2021, the DHFL lenders stated the following:

“Lenders said the NCLT order may set a bad precedent, with more promoters moving the court to consider their offer.”

“That if the impugned orders were allowed to operate, it would be extremely prejudicial as it creates a new process, which is contrary to the express provisions of the Code and, if allowed, the CIRP will be never ending where parties will be permitted to keep making offers without regard to sanctity of the process or timelines, including after CoC has exercised its commercial wisdom and approved a plan, which has been submitted by an eligible resolution applicant in compliance with the Code,” DHFL’s lenders said in their appeal.”

SOURCE: Appeals Court Stays Order on Wadhawan VIEW HERE ⤡ (As reported on 26th May, 2021 ©The Mint)

The lenders said that the verdict of the NCLT would set a “bad precedent” (if their first order was being followed), since the DHFL case was the first case to go under the experimental, ill-conceived IBC (2016). “Bad precedent”? Such statement made by lenders is not only irrational or illogical, it is also ridiculously illogical! Be it the first or last precedent, we must call spade a spade! An illegal resolution process does not become legal solely in order to legitimize or rationalize the newly-introduced IBC! Why is the RBI-appointed CoC deliberately providing help to the present politico-legal administration and their engineered codes/ laws/ policies by the help of their wis(h)dom (The CoC can do no wrong! Is the ‘Wis-h-dom’ of the CoC presupposed?)?

Whether the sheer ignoring of the NCLT May 2021 order by the Piramal-CoC can be admitted as a contempt of court or not requires judicial attention. Mr. Piramal thus presumably violated Article 215 of the Indian Constitution. NCLT was forced to approve the resolution plan (which is contrary to their first order) on 07.06.2021. Piramal “acquired” the DHFL in September 2021 on the basis of the NCLT, the lowest quasi-judicial body’s second verdict.


The NCLAT verdict (27.01.2022) that designated the CoC resolution process to be “contrary to law”, “void” and as containing “material irregularities” was stayed by the Hon Supreme Court on 11.04.2022 after Piramal approached it on 01.03.2022 without first approaching the High Court.

Mr. Piramal, as an influential person, is an obsessive and habitual blanket stay order-seeker. Earlier, in a case of eco-terrorism, he did the same thing and was rejected by the National Green Tribunal (NGT). cf. Ajay Piramal: How Many Times Are You Seeking “Blanket” Stay Orders? VIEW HERE ⤡

In the occasion of both the stay orders, it can be seen that Piramal is more equal than others⤡.

For your convenience, we are forwarding the following links to make out the background of DHFL victim’s miseries.

III. REGARDING RBI-APPOINTED CoC’S (MIS-)CONDUCTS



It is to be noted that a Resolution Professional comes within the meaning of ‘Public Servant’ under Section 2(c) of the Prevention of Corruption Act, 1988, and Section 233 of IBC does not protect where he has been apprehended red-handed with the bribe amount – Sanjay Kumar Agarwal Vs. Central Bureau of Investigation, Anti-Corruption Bureau, Dhanbad – Jharkhand High Court.

It is also to be duly noted that the old promoters of the DHFL, Mr. Kapil and Dheeraj Wadhawan, were not allowed to participate in the RBI-appointed CoC’s resolution process following the (controversial and ineligible) IBC U/S 29A ⤡, even though the Hon’ble NCLAT, New Delhi declared: “Suspended Director, who was representing the Corporate Debtor and has submitted the Settlement Proposal is entitled to participate in deliberation and negotiation undertaken by the CoC.” (in Sanjeev Mahajan Vs. Indian Bank (Erstwhile Allahabad Bank) & Anr.)

We are reminded of the known fact that Bankruptcy will not void personal guarantees: Hon’ble Supreme Court VIEW HERE ⤡ (As reported on May 22, 2021 ©The Times of India). Let us look at the rules and regulations of IBC (2016) for such deliberate avoidance of the Wadhawan brothers (“former” promoters of the DHFL) by the CoC to hand the DHFL over to Mr. Ajay Piramal, a hostile bidder and an alleged insider trader ⤡, which appears to be a case of adverse possession⤡ or squatter’s right. It seems that Mr. Piramal is allegedly violating the Tort Law⤡.

The RBI appointed CoC administrator and the representative of the FD-holders are good for nothing, but they had swallowed DHFL victims’ money to continue expensive Resolution process. If they are to be sued by the DHFL victims, they would fight against the victims by utilizing their money. As public servants, what they have done is more than criminal activities. They must be publicly condemned.

IV. ALL ABOUT AJAY PIRAMAL, the “winner” of the DHFL Bidding:

1. Mr. Piramal is an alleged insider trader (2016)


2. He seems to be an eco-terrorist (for polluting Digwal, Telangana in 2019) and also who sought “blanket stay order” at the National Green Tribunal, which was rejected. In the case of the DHFL also, he wanted such a similar stay order on the “controversial” NCLAT second verdict (27/01/2022).

2. He was involved in Flashnet Scam, 2018 (though Mr. Piramal was ready to defame The Wire, who first exposed the scam, for reporting the same, but till date: no such step has been taken by him)

3. He is possibly involved in contempt of court during the DHFL resolution process by ignoring NCLT’s first verdict (19/05/2021) and skipping the points raised by the NCLAT second order (27/01/2022).


V. ALL ABOUT THE WADHAWAN BROTHERS: “OLD” PROMOTERS OF DHFL

The “old” (?!) promoters of the DHFL, viz., the Wadhawan Brothers, were removed from their company roles when DHFL was put under the Corporate Insolvency Resolution Process (CIRP) at the end of 2019. However, they had repeatedly stated their offer for full repayment of all the creditors, which were ignored by the RBI-appointed CoC. The Wadhawans were not also allowed to participate in the decision-making process of the DHFL resolution.

The CBI, on October-November, 2022, came up with a report that stated that the Wadhawans engaged in creating “shell” or “dummy”/”proxy” companies to siphon off astronomical amounts of money through fraudulent transactions by creating fake bank accounts.

It has also been recently reported by the Godi Media that the Wadhawans, who are currently in penal confinement, are living a “lavish” lifestyle under the pretext of seeking medical treatment.

It is also to be noted that Maharashtra is currently under the governance of the BJP coalition with a faction of the Shiv Sena and NCP. It is also to be remembered that the faction of Shiv Sena and Nationalist Congress Party (NCP) members were bought by spending huge amount of money (horse-trading) and blackmailing. How can Wadhawans live such a luxurious life when the BJP coalition is in de facto power in the said state? Could they have done the same without political aid?

Information regarding them could be found in the following two articles:

It is very difficult to understand the situation of the DHFL occupation as both Wadhawan Brothers and Mr. Piramal are favoured by the ruling party of India, although in different ways. It may be conjectured that it is a game of money: terror-funding/political donation/political charity.

VI. WHO IS RESPONSIBLE FOR THE DECEPTIVE AUDITING OF THE DHFL?

i. What is the role of the auditors in the case of the DHFL scam? Did the DHFL lack any diligent auditing? Who is to be held responsible for such collapse of a profitable ongoing concern?

ii. What is the role of the Rating Agencies in the case of the DHFL scam, an AAA-rated company?

Were the watchdogs (they cannot be bulldogs!) of financial affairs taking sedatives or sleeping pills during the so-called “fraudulent transactions” through the alleged “Bandra Books” (yet to be evidentially proved in the court of law) as well as the relation of the DHFL ex-promoters to Yes Bank promoter Mr. Rana Kapoor?

VII. ALL ABOUT THE BRAND AMBASSADOR OF THE DHFL: MR. SHAH RUKH KHAN

Some of the victims of the DHFL Scam are demanding the Brand Ambassador’s positive response on this matter as he has deceived the consumers by promoting the DHFL, under the Consumer Protection Act, 2019⤡, for “False and Misleading Advertisements” by violating the rights of the consumers. Here, the Brand Ambassador of the DHFL did not follow the path of Mr. Mithun Chakraborty, who returned 1.15 crores taken from Saradha ponzi scheme to the Enforcement Directorate. For such deceiving advertisements, the consumers cannot come under the definition of caveat emptor (Let the buyer beware!).

VIII. ROLE OF THE CURRENT RULING PARTY OF INDIA

Mr. Ajay Piramal, the so-called “winner” of the bidding war, has always remained in the good book of the current ruling party of India, viz., the Bharatiya Janata Party (BJP). This was clear even much before the DHFL scam, when Mr. Piramal’s collusion with the ruling party became evident through the fact of Flashnet Scam involving BJP Union Minister Mr. Piyush Goyal.

Furthermore, on 29.01.2019, the Cobrapost, in its findings on the DHFL scam, reported that the BJP, the ruling party of India, was involved in this scam through terror-funding/political donation/political charity. The nexus/collusion amidst DHFL, RKW Developers (Dheeraj Realty), the BJP and the Dawood Ibrahim-Iqbal Mirchi Gang was alleged through this report.



When concerned authority of the RTI gave some #DHFL_Victims a negative (ambiguous?) response, the victims had requested the President, BJP and the Sarsanghchalak of the RSS (a non-registered Hindu extremist group) to file a defamation case against the media houses, who had spread such “rumours” against a party, which is not a public authority.

However, till date no such defamation case has been filed either by the BJP or by the RSS against those newspapers.

It is also to be mentioned that on 25.06.2022, the Indian National Congress alleged the BJP of getting political donations worth 27.5 crores (or more, as political parties are not “public authorities”, it is very difficult to know the exact figure of donations made by unknown sources in the electoral bonds.) from the (ex-?) promoters of the DHFL.

Ambiguously enough, in the case of PM CARES fund, it is simultaneously governmental as well as non-governmental. None can use the RTI for any inquiry about these transparently opaque cases from the scam-hit DHFL.

IX. Piramal’s Defamation against Some Aggravated DHFL Victims, Who Are Conducting Web-Based Non-Violent Civil Disobedience Movement

In the beginning of this year, Piramal’s legal Farm, DSK Legal, filed a defamation case against some of the DHFL victims, who were engaging themselves in the web-based non-violent civil disobedience movement against the crony oligarchy. The case initially reported a cost of 100 Cr to be paid by these innocent victims to compensate for the supposed “reputational loss” suffered by Mr. Piramal!

Soon enough, the 100 cr notion was removed from the consequent e-mailed appeals by one of the “unknown defendants” (?). The initial defamation also talked of geo-blocking of certain posts/tweets posted by those victims, which was also removed subsequently since geo-blocking is impossible in the cyber-space.

Recently in September 2023, the defamation petition by Piramal’s legal team was updated to a contempt petition, saying that one of those DHFL victims, Dr. Debaprasad Bandyopadhyay (designated as “Unknown Defendant 6”), has deliberately ignored the Bombay High Court’s orders to stop posting defamatory content on the social media platforms⤡.

X. CONCLUSIVE(?) REMARKS FROM SISYPHUS

From October 2019, DHFL victims are suffering from psychosomatic disorders for the reason of such scam, where they comprehend the real meaning of the proverb: Justice Delayed, Justice Denied. Some of them are having suicidal tendencies or they are appealing for legalizing active euthanasia in India⤡ by compromising their “Right to Life” (Article 21 of the Indian Constitution).

P.S.: It is to be noted that this is the seventh as well as latest online petition of the DHFL Victims:

Other six (knocking the doors of the Gatekeepers cf. Kafka’s The Trial) are listed below:

Although it is a mere truism that “International law is the vanishing point of jurisprudence” ⤡, yet if sovereign government cuts a sorry figure to implement all the procedures to uphold international business-related rights of its citizens, a financially abused person would be compelled to take his/her/their recourses to the vanishing point, i.e., parallel international “law” (?) without hampering the sovereignty of the imagined nation state⤡. In doing so, the state must be compelled to fulfil its international human rights obligations. The DHFL Victims are financially abused due to the violation of their business related human rights as declared in the United Nations Guiding Principles on Business and Human Rights ⤡ (in this context, “Access to remedy for victims of business-related abuses”).

Dear Non-Godi Media, the new fifth pillar of democracy within the ambit of crony plutocracy and savage cannibalistic capitalism, we are earnestly requesting you to take necessary actions regarding this matter after due checking of facts.

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