By Saloni Shukla and Shruti SrivastavaThe Indian government has sought to reopen the books of Infrastructure Leasing Financial Services group, alleging evidence of auditing lapses was uncovered while looking into allegations that funds were siphoned from the beleaguered financier.A probe by Indias Serious Fraud Investigation Office indicated the lenders accounts were fraudulent and mismanaged, Sanjay Shorey, a lawyer for the government told the National Company Law Tribunal on Friday.
The court told the government to notify those involved, including regulators and tax authorities, of its petition and set Jan.
1 as the next hearing date.Indias is probing the alleged diversion and siphoning of funds from ILFS, a systemically important infrastructure financier, which missed a series of debt repayments this year.
The groups struggle to service $12.6 billion in borrowings had roiled the credit market and continues to make it harder for other non-bank lenders to access funds.
The government in October replaced the management of the troubled company.The initial findings of a body overseeing accountants found that ILFSs statutory auditors were responsible for mismanagement, Shorey told the court in Mumbai.
The petition included copies of the Institute of Chartered Accountants of Indias initial opinion of audits of some companies conducted by Deloitte Haskins Sells LLP, SRBC Co.
LLP and BSR Associates LLP, according to a copy of the petition seen by Bloomberg.A spokeswoman for EY, an SRBC Co.
affiliate, declined to comment before seeing a copy of the petition, while there was no immediate response to an email sent to Deloitte Haskins and a representative for KPMG, a BSR affiliate, wasnt immediately reachable.Shorey, who was representing the Ministry of Corporate Affairs, has asked for a re-examination of the books over the past five years of Infrastructure Leasing Financial Services, ILFS Financial Services Ltd.
and ILFS Transportation Networks Ltd.
He asked that the central government be allowed to appoint an auditor and the books to be finalized in three months.