Manpasand Beverages scam: How Sebi exposed the Rs 40-crore GST fraud
Securities and Exchange Board of India (Sebi) has barred Manpasand Beverages Ltd (MBL) and its top officials and directors from the securities markets for a period of three years from now and also imposed a total penalty of Rs 74 lakh for manipulating and mis-reporting the company's financial statements.
The Vadodara-based company has been at the centre of controversy since Deloitte resigned as its auditor in May 2018. Things went downhill after its top brass was arrested for the goods and services tax (GST) fraud of Rs 40 crore in 2019.
The company was set up in 1998 by Dhirendra Singh. In the following years, the company focused on rural markets and tier-2 and tier-3 cities to grow its presence, as opposed to its rivals who made metros their target.
In 2018, the company's distribution was at its peak with 600,000 outlets across India, as well as three plants in Vadodara, Varanasi and Sri City. The beverage company had plans to set up its fourth plant. But, the unearthing of the tax scam by the Central GST Commissionerate Vadodara showed that the company had used this network to operate through fake units..
