India’s roster of private companies is littered with shell companies, shelf companies, and companies with weird names that have nothing to do with their supposed line of work, and often have no meaning whatsoever. Although many of them operate in legally dubious manners – or don’t really ‘operate’ in any meaningful sense of the word – their obscurity means we don’t normally get to hear about them.
One such company is Karanja Infrastructure Private Limited. This is a company which:
has ties to companies in the private defence sector, including Nikhil Gandhi’s and Anil Ambani’s;
is owned by a company in Mauritius, Blackstone Capital Limited, and gets foreign investment from this company from time to time;
has few assets and very little revenue (it has actually gone entire years without any income at all);
has massive, unexplained unsecured debts to the tune of Rs 380 crore, and for which they pay no interest;
gives out large capital advances (around Rs 260 crore) to random companies; and
has been ensuring debt-ridden companies get loans worth hundreds of crores from banks, by guaranteeing the loans against its properties (the value of which comes to barely Rs 63 crores).
For different people reading this, it’ll be ringing different alarm bells. If you are an accountant, you’d would look at its balance sheet and wonder how the company survives. If you’re a lawyer, you’d look at those unsecured debts and wonder how the company hasn’t fallen foul of laws that don’t allow interest-free loans.
If you’re an officer of the Enforcement Directorate (ED), well, you’re going to start wondering if you need to consider an investigation into fun things like money-laundering, round-tripping and financial subterfuge.
Now, those aren’t allegations we’re going to throw around ourselves. Instead, we’re going to present the facts about this company and let you decide what to think.
Maybe you’ll think this is all unnecessary, that it’s entirely above-board. Maybe you’ll think it’s a bit dodgy but not newsworthy. Or maybe you’ll have some questions you’d like to ask.
Like why does this company exist? Who owns it? What does it do? And why in God’s Adam Smith’s name does anyone want to have anything to do with it?
And maybe, just maybe, if enough people ask those questions about this company and others like it, we might start to get some answers about India’s shadowy private defence sector.
They insisted we speak to their bosses, but refused to say who their bosses were, or how to contact them. We were able to get a number for the boss who sometimes comes in to this office from one of the neighbouring shop-owners, but this number couldn’t be reached.
We also reached out to one of the directors of the company (according to the Ministry of Corporate Affairs’ information about KIPL), who said he wouldn’t be able to help us understand the company’s business, and also that he had resigned from the company in February 2016. However, the company’s annual report dated 30 September 2017, available on the Ministry of Corporate Affairs website, bears his signature. He refused to comment any further.
As can be seen, attempts to inquire about the company’s business in good faith were stonewalled, for no apparent reason. Instead, we have to piece together what we can about the company from publicly available information, which doesn’t paint a very favourable picture.
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