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Delhi court asks police to conclude probe in Paytm ownership row in 3 weeks

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A court in Delhi has directed the police to complete the probe into the Paytm ownership row within three weeks. The row involves the claim of a former Paytm director, Ashok Kumar Saxena, who said he co-founded the company nearly two decades ago, but did not receive shares owed. The next hearing of the case is scheduled on September 13.

The issue

The former director, a septuagenarian, has claimed he invested $27,500 two decades ago in Paytm parent One97 Communications but was never allotted any stock. The crux of the dispute is a document signed by Saxena and current Paytm chief Vijay Sekhar Sharma, as seen by a news agency that dates back to 2001, according to which Saxena was to own 55% of One97 Communications and the rest was to be owned by Sharma.

Saxena, a director from 2000 to 2004, has written to the market regulator urging it to stop Paytm from proceeding with the IPO. Corporate governance experts said the tussle could spark regulatory inquiries and complicate the approval of an IPO that could value Paytm, backed by Chinese e-commerce leader Alibaba Group Holding Ltd, at up to $25 billion.

What Paytm said

Paytm has said the claim amounts to harassment and cited it under “criminal proceedings” in the prospectus for its proposed $2.2 billion initial public offering (IPO).

Paytm, in a response to a police notice denied Saxena was a co-founder and said the document in question was “merely a letter of intent” which “did not materialise into any definitive agreement”.

What court said

The court of Metropolitan Magistrate Animesh Kumar directed the police to submit the final probe report within three weeks. Police have submitted a status report to the court, but is yet to conclude the investigation.

 

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