Hero MotoCorp under scanner, MCA orders probe for diversion of funds
New Delhi, June 15
The Ministry of Corporate Affairs (MCA) has ordered an investigation to assess Hero MotoCorp’s relationship with a third-party vendor in a case related to alleged diversion of funds, two government sources said on Thursday.
The investigation has been ordered in the “public interest” to probe the ownership structure of Hero MotoCorp and whether it controlled the third-party vendor, said the two sources, who are privy to the internal government directive.
The internal government order follows a preliminary inquiry conducted by the Registrar of Companies, the two sources said.
The case was seen fit for a further formal investigation in the “public interest”, they said.
The Ministry of Corporate Affairs, under legal provisions, now has powers to record statements of company officials and ask for documents to conduct an investigation.
Separately, Hero MotoCorp was under the scrutiny of India’s income tax authorities last year.
The company last year said tax inspectors visited its offices and the home of CEO Pawan Munjal as part of a “routine inquiry”. Reuters
Ownership structure
- The investigation has been ordered in the “public interest” to probe the ownership structure of Hero MotoCorp and whether it controlled the third-party vendor
- The internal government order follows a preliminary inquiry conducted by the Registrar of Companies
- Separately, Hero MotoCorp was under the scrutiny of I-T authorities last year
