Share of housing finance company Dewan Housing Finance Corporation (DHFL) zoomed 17 percent intraday on Wednesday after an independent review report released by the company reported that it has not promoted any of the 26 shell companies, which were alleged to have siphoned off about Rs 35,000 crore of the company by investigative news portal Cobrapost.
“There is no evidence of DHFL forming shell companies to divert funds, promoters hiding shareholding in any companies and insider trading”, said a report by chartered accountant firm TP Ostwal & Associates.
The report added that monitoring related to 15 borrowers, who offered loans amounting to Rs 7,485 crore, is inadequate, and there were certain instances of non-adherence in loans having major risk implications.
“Loans were disbursed to only 10 of the alleged 45 companies, totalling Rs 4,715 crore — of which Rs 1,640 crore were repaid by borrowers up to December 2018,” read the TP Ostwal report.
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TP Ostwal & Associates LLP also found Cobrapost’s allegations baseless and without merit. “No evidence was found to corroborate or support allegations of tax fraud,” it added.
Cobrapost said on January 29, DHFL and its promoters diverted funds to shell companies to buy assets. And, firms linked to Dewan’s controlling shareholders – the Wadhawans- made political donations beyond mandated levels.
At 09:29 hrs Dewan Housing Finance Corporation was quoting at Rs 157.25, up Rs 23.25, or 17.35 percent. It has touched an intraday high of Rs 160.80 and an intraday low of Rs 147.40.