IFCI Slumped 6% on the Back of Investigation

IFCI share price slipped 6% intraday on Monday.

Previously, the Supreme Court directed the Centre to
guarantee proper scrutiny of all aspects of alleged
financial irregularities in the Industrial Financial
Corporation of India (IFCI), which includes severe
allegations in regards to investments made by and the
role of its former chief Atul Kumar Rai.
A bench, administered by Chief Justice T S Thakur,
mentioned that the purpose of investigation was to scrutinize the serious
allegations made regarding investments by IFCI. In view of the matter and for the
aforementioned reasons, they are of the view that it is necessary and legitimate to
issue a direction both to the union ministry of finance and union ministry of
corporate affairs to assure that a proper scrutiny is carried forward in respect of
the allegations which form the basis of these proceedings. Justice D Y Chandrachud
also mentioned that they direct the Union Government to secure a due and proper
scrutiny into all aspects of the matter by the (i) severe frauds investigation officer,
(ii) Reserve Bank of India (RBI), and (iii) Securities and Exchange Board of India
(Sebi). Needless to add, the scrutiny shall be administered with due observance of
norms of procedural fairness including an opportunity to IFCI to respond to the
allegations. Also, the solicitor general has also not opposed a direction for further
independent
scrutiny.
IFCI share price was quoting at Rs. 28.75, touching the days high and low at Rs.
29.50 and Rs. 28.65 respectively.
The court gave the judgment on a PIL filed by NGO Centre for Public Interest
Litigation which sought an independent scrutiny into several alleged financial
irregularities which have come to light in recent past in IFCI. While disposing of the
petition, the bench said that the investigation shall be started within a month from

the receipt of a copy of this judgment and executed in four months thereafter. It
further added that after receiving reports of the respective agencies, the
Government should actively determine what action was required to ensure
compliance of law. The petition, filed through Prashant Bhushan, had alleged also
challenged Rais appointment as the managing director and chief executive officer
of the financial services major. The bench said that an investigation into the
allegations was done by ROC which gave its report and the Department of Financial
Services
had
forwarded
it
to
IFCI.
Dynamic Levels has identified IFCI as the top 500 performing stocks for this
quarter.

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Article Written by
Madhurima Chowdhury