BharatPe Sues Ashneer Grover, His Family To Seek Rs 88 Crore In Damages

The fintech unicorn, BharatPe is suing former managing director and co-founder Ashneer Grover's wife Madhuri Jain and other family members in damages for up to Rs 88 crore.

The Grover family allegedly created fictitious bills, fictitious enlisted vendors to provide services to the company and overcharged the company for recruitment.

The Delhi High Court issued a summons to the Grover family today, instructing them to respond to the company's charges within two weeks. The next hearing has been scheduled for 9 January.

Meanwhile, the company has filed a criminal complaint with the Economic Offences Wing (EOW) against Grover and his family on 17 counts, including criminal breach of trust, forgery, document fabrication and embezzlement.

“At the moment, it's just a complaint, not an FIR. If the Grovers are found guilty, they could face ten years in prison,” according to the source.

Jain was fired as BharatPe's head of controls earlier this year after a forensic audit revealed several irregularities. Following a public disagreement with the board, Ashneer Grover resigned as CEO.

Senior Advocate Mukul Rohatgi, who represents BharatPe, also asked the court to intervene to prevent Grover from continuing his “vitriolic campaign” against the company on social media.

The company sought Rs 83 crore in damages for misappropriation of funds and Rs 5 crore in damages for reputational harm caused by Grover's public statements in the civil suit.

“Once in these key positions and roles, the Defendants treated the Plaintiff as their personal fiefdom. By willfully perpetuating the Plaintiff company's lack of internal governance policies, they conducted its affairs for their personal benefit,” BharatPe claimed in its plea.

The company claimed that the Grovers created bogus vendors and bills for recruiting services in order to hire employees who were actually hired directly by the company. Rohatgi mentioned in court a certain Mr Behl, who was directly hired for a salary of Rs 1 crore, but fake vendor bills were created to charge the company a 15 per cent commission on the hiring.

In another case, the Grovers arranged for a payment to be made to Golden Holidays, a vendor claiming to provide travel agency services, for a reservation in Thailand. Golden Holidays, on the other hand, did not offer any services. Furthermore, the company had already paid for the same bookings and dates to another travel agency that provided the goods and services.

In addition to questionable transactions and phoney vendors, the company claimed that Grover made no contributions to the technology or concept of BharatPe. His involvement with the company began in 2018 when he made a minor investment of Rs 31,920 for which 3,192 shares were allotted.

According to the company, Grover blatantly misappropriated funds for personal expenses such as rent and utilities on their residence, payments for family members' air travel and the purchase of home appliances such as two televisions and a refrigerator.

Since the beginning of the year, founder Ashneer Grover has been accused of using inappropriate language and threatening a Kotak Group employee for failing to secure an allotment and funding for the Nykaa IPO for himself and his wife Madhuri Jain Grover.

Grover and Madhuri Jain Grover were fired from the company due to allegations of money laundering.

The company had tasked Alvarez, Marsal, Shardul Amarchand Mangaldas and PwC with conducting a corporate governance review and determining whether Grover had engaged in willful misconduct.

On 10 May, BharatPe announced a thorough investigation, the company had decided to take action against employees who had engaged in misconduct and to reclaim Ashneer Grover's restricted shares.

After raising USD 370 million led by Tiger Global, the company joined the unicorn club in August 2021. Later in October, the company named Rajnish Kumar as chairman.

Kumar has also been drawn into the company's squabbles, with Grover calling for his dismissal, as has CEO Suhail Sameer, who has led the company since Grover's departure.