Subhiksha denies any fund diversion, discrepancy

Subhiksha denies any fund diversion, discrepancy
PTI
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First Published: Wed, Feb 11 2009. 05 17 PM IST
Updated: Wed, Feb 11 2009. 05 17 PM IST
New Delhi: Cash-strapped retail chain Subhiksha Trading Services on Wednesday said there were neither discrepancies in its accounts nor diversion of funds, while acknowledging that salary cheques of some of its employees have not been honoured due to non-availability of liquidity.
“We are not aware of any such allegations (account discrepancy and fund diversion) at all and this is the first time we are hearing about this. Obviously these allegations are false and motivated and deserve to be treated with contempt,” Subhiksha Trading Services Managing Director R Subramanian said.
Subramanian’s comments come in the wake of reports that employees of the retail chain were planning to file case for “dishonouring pay cheques” while alleging the company of “diverting funds and fudging the accounts.”
He, however, admitted that the salary cheques of some employees have not been honoured and blamed the situation for non-availability of funds.
“We have admitted that salaries are in arrears since October 2008. Some pay cheques for October and November 2008 dated mid-January 2009 or so were issued based on assurance that we would be receiving some money as an interim measure. Such money did not materialise and the cheques could not be honoured,” Subramanian said.
Subramanian said Subhiksha is trying to raise money for the payment of employees’ salaries.
“The company has every intention of honouring the cheques and is attempting to raise money for this. The fact is that salaries are in arrears and this has been already stated, and that cheques are not honoured is only a technicality and not a real issue,” Subramanian added.
He said the company, which is seeking Rs300 crore as debt or equity to bounce back into business, is in talks with banks and investors for emergency funds once the ongoing corporate debt restructuring programme at Subhiksha gets over.
On being asked about the likely date for resumption of operations, Subramanian said it may happen in May.
He conceded that the company has lost some employees due to the current situation.
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First Published: Wed, Feb 11 2009. 05 17 PM IST