Ahmedabad-based Pipara & Co’s offices were raided by anti-corruption bureau sleuths in March in connection with alleged misconduct in the audit of Gujarat State Land Development Corporation.
appointed Pipara & Co on 27th September 2019 to carry out a forensic audit of CG Power after the board of the company reported to stock exchanges that it had found several ‘unauthorized’ related party transactions. The forensic auditor has been under investigation of Gujarat’s anti-corruption authorities since 2018. Two of it’s employees were also arrested in connection with the allegations. Based on the auditor’s report SBI filed a complaint with CBI in May.
“We don’t comment on individual accounts”, said a State Bank of India official in response to ET’s queries.
“Our understanding is that the charges levelled by the Anti-Corruption Department pertain to the said two ex-employees and not against the Firm. We have been told by these two past employees that the charges levelled against them were found to be without basis by the Hon’ble Courts and that they have been released on bail by the H’ble Gujarat High Court”, said Gyan Pipara, Partner Pipara & Co in a response to ET’s queries.
“The action of ACB in raiding of our office, was ill motivated and it was with ulterior motive”, said Pipara. He also claimed there was no investigation pending against his firm.
A recent Gujarat high court order granting bail to one of the former employees of Pipara & Co in connection with the audit of Gujarat State Land Development Corporation noted that there was no prima facie evidence to suggest that the employee had received any unlawful gain during his involvement in the audit while he was working with the auditor. However, Gujarat’s anti-corruption bureau has not closed the investigation.
Pipara & Co. submitted its forensic audit report to SBI on 22 May 2020. SBI filed a complaint with CBI on 28 May 2021 alleging diversion of funds to the tune of Rs. 2435 crore from CG Power based on the report of the forensic auditor. An FIR was registered by CBI levelling criminal charges against Thapar and other directors and former employees of CG Power on 22 June 2021. ET has reviewed the contents of the FIR and SBI’s complaint that was appended to it.
Three separate forensic audits have been carried out in the case of CG Power. The company’s board had commissioned an audit by Vaish & Co and Deloitte on 20 June 2019. Sebi subsequently ordered a forensic audit of its own on 17 September 2019 which was carried out by MSA Probe Consulting. Pipara & Co’s forensic audit for SBI was the third such audit.
The findings of all three audits vary, said sources aware of their contents.