Amidst a series of legal tussles, Rahul Yadav, co-founder of 4B Networks, and Sanjay Saini, a founding member, have approached a Mumbai Court to secure anticipatory bail, aiming to shield themselves from ongoing legal challenges.
Seeking Bail Amidst Allegations in 4B Networks
As reported by CNBC-TV18, Yadav and Saini have filed for bail in connection with a First Information Report (FIR) lodged by Vikas Nowal, co-founder and country head of Interspace Communications. The FIR alleges fraud and deceit by Yadav, implicating the Economic Offences Wing (EOW).
Anticipatory Bail Challenged
Reportedly, Mumbai police are set to oppose the anticipatory bail application made by the duo, adding an additional layer of complexity to the situation.
Under Scrutiny in 4B Networks
The duo has been under agency questioning for several days. During this inquiry, both Yadav and Saini have assured the agency that they intend to settle the money owed to Interspace. However, they have refrained from providing a reason for the initial payment default.
The Allegations
Earlier this month, Nowal filed an FIR with the EOW, invoking sections 406, 409, 420, and 34 of the Indian Penal Code. The allegations revolve around criminal breach of trust and fraud amounting to INR 10 crore. The dispute centers on the advertising agency Interspace Communications, which Broker Network enlisted for outdoor ad campaigns in February 2022.
Disputed Transactions
According to the FIR, Interspace set up 83 ad hoardings in Pune between April and August 2022. Nowal accuses Broker Network of defrauding Interspace and failing to make the INR 10 crore payment for the ad activity conducted in 2022.
Parallel Legal Matters
This development coincides with another legal incident. While hearing an arbitration case filed by Innov8, a coworking space provider, the Delhi High Court observed that 4B Networks had forfeited its right to respond due to a failure to address non-payment of INR 1.08 crore in rent to Innov8.
Investor Controversy in 4B Networks
Furthermore, Broker Network is entangled in an arbitration proceeding with investor InfoEdge. InfoEdge had invested INR 288 crore in the startup led by Rahul Yadav but had to devalue its investment due to allegations of financial misconduct.
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Refusal to Disclose Information
Rahul Yadav’s reluctance to divulge financial transaction details during a forensic audit prompted by InfoEdge led to escalated arbitration proceedings.
Looking Forward
InfoEdge has taken the matter to the Delhi High Court against Yadav and Pratik Choudhary, another party to the shareholders’ agreement of 4B Networks. The High Court directed Yadav and Choudhary not to sell, transfer, or dispose of any assets or properties of 4B Networks and to preserve all records and information.
