After being summoned by Mumbai Police for a bailable warrant, Broker Network founder Rahul Yadav pled not guilty to charges in a private complaint heard at Mumbai’s Additional Metropolitan Magistrate court’s Mazgaon division on November 22, 2023.
Yadav appeared in court after a bailable warrant was issued in October 2023 in relation to the complaint filed by former Broker Network employee Arun Singh Shekhawat in May 2023.
Shekhawat told Inc42 that Mumbai police visited Yadav at his residence in Khar and he was then taken to the Khar Police Station on November 9, 2023. Yadav then paid a bail guarantee of INR 5,000 and was released the same day.
Yadav, who previously cofounded Housing.com, was summoned by the court in this matter in June, July and September, but neither he nor his counsel appeared in front of the magistrate as per court records seen by Inc42.
This led to the bailable warrant notice followed by Yadav being taken into custody. Failure to appear for the November 22, 2023 hearing is likely to have resulted in a non-bailable warrant issued by the magistrate.
The complaint was registered under Section 138 of the Negotiable Instruments (Amendment) Act. The issue relates to a dishonoured or bounced cheque for INR 50 Lakh allegedly signed by Yadav and paid to Shekhawat.
The amount was alleged to be in lieu of INR 50 Lakh borrowed by Yadav from Shekhawat in August 2022 at a time when Broker Network was unable to pay the salaries of employees.
Shekhawat alleged, “He borrowed INR 50 Lakh from me personally on the pretext of paying salaries to employees in August 2022, at an interest rate of 5% per month. Then in 2023, he gave me a cheque for INR 50 Lakh which bounced, and led to my complaint.”
The former Broker Network senior executive added that besides this Yadav and the company owed him INR 70 Lakh in salaries and benefits. These pending dues are not part of the complaint filed by Shekhawat.
EOW Looking Into Rahul Yadav
It must be noted that the Economic Offences Wing is investigating two separate cases against Rahul Yadav, one of which is filed by Broker Network’s lead investor Info Edge.
The first case, which has been registered as an FIR, is about non-payment of dues and subsequent INR 10 Cr fraud allegations raised by Vikas Nowal, country head and cofounder of Interspace Communications.
Inc42 first highlighted the sorry state of the company in June 2023 which showed that Broker Network owes tens of crores of rupees to several vendors. Interspace was one of the many vendors that the troubled startup had not paid despite being an empanelled vendor. Besides this, employees of the company have also not been paid since September 2022.
Read Our Full Broker Network & Rahul Yadav Story Here
The second complaint with the EOW was filed by Broker Network’s chief backer Info Edge, alleging a fraud of INR 288 Cr, which we reported last month. It’s imperative to note that the complaint filed on August 22, 2023, has not yet been registered as an FIR by the EOW.
Besides Rahul Yadav, the EOW complaint names 4B Networks Private Limited, and cofounder and director Pratik Chaudhary as well as Devesh Singh (Yadav’s brother-in-law), Yadav’s wife Karishma Khokhar, and RY Advisory LLP, the partnership firm which was set up by the Broker Network founder.
Key employees and business heads involved with Broker Network such as Sanjay Saini, Vivek Jagtap (former CTO), Ashish Chandna, and Manish Agrawal have been named as co-accused in the complaint.
As detailed in Inc42’s original investigation into Broker Network, these individuals are linked to a network of companies and entities that are alleged to have syphoned off funds from Broker Network for personal gains.
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