The revelation made by a news portal, The Wire, about the phenomenal rise in the turnover of the business being run by the firm Temple Enterprise Private Ltd owned by Jai Amitbhai Shah, son of the BJP president Amit Shah, has created flutter in the country’s politics.
The story says that the turnover of a company owned by Jay Amitbhai Shah, son of Bharatiya Janata Party leader Amit Shah, increased 16,000 times over in the year following the election of Narendra Modi as prime minister and the elevation of his father to the post of party president The story has given the reference of filings with the Registrar of Companies (RoC) as the source of information.
Company balance sheets, it adds, and annual reports obtained from the RoC reveal that in the financial years ending March 2013 and 2014, Shah’s Temple Enterprise Private Ltd. engaged in negligible activity and recorded losses of Rs 6,230 and Rs 1,724 respectively. In 2014-15, it showed a profit of Rs 18,728 on revenues of only Rs 50,000 before jumping to a turnover of Rs 80.5 crore in 2015-16.
The astonishing surge in Temple Enterprise’s revenues came at a time when the firm received an unsecured loan of Rs 15.78 crore from a financial services firm owned by Rajesh Khandwala, the samdhi (in-law) of Parimal Nathwani, a Rajya Sabha MP and top executive of Reliance Industries, the write-up says.
One year later, in October 2016, however, Jay Shah’s company suddenly stopped its business activities altogether, declaring, in its director’s report, that Temple’s net worth had “fully eroded” because of the loss it posted that year of Rs 1.4 crore and its losses over earlier years.
Temple Enterprise was incorporated in 2004 with Jay Shah and Jitendra Shah listed as its directors. BJP president Amit Shah’s wife, Sonal Shah, also has a stake in the company.
In 2013-14, Temple Enterprise did not own any fixed assets and had no inventories or stock. It also got an income tax refund of Rs 5,796. In FY 2014-15, it earned Rs 50,000 as revenue. However, in 2015-16, the firm’s revenues jumped to over Rs 80.5 crore, a growth of 16 lakh percent. Reserves and surplus turned negative to Rs 80.2 lakh from Rs 19 lakh the previous year. Trade payables were Rs 2.65 crore, up from Rs 5,618 the previous year. The assets of the company were only Rs 2 lakh. The firm had no fixed assets the year before. Short-term loans and advances were Rs 4.14 crore, up from Rs 10,000 the year before. Inventories were Rs 9 crore, up from zero the previous year, according to the firm’s filings.
The massive increase in revenues is described in the filings as coming from the “sale of products”. This included Rs 51 crore of foreign earnings, up from zero the previous year.
The filings also reveal an unsecured loan of Rs 15.78 crore from a listed entity, KIFS Financial Services. The revenue of KIFS Financial Services for the same financial year when the loan was given was Rs 7 crore. The annual report of KIFS Financial Services also does not reflect the Rs 15.78 crore unsecured loan given to Temple Enterprise.
Jai Shah has filed a Rs 100 crore defamation suit against the news portal for the article.
The Congress has gone to the extent of alleging that Jai was already aware of the noteban.
Congress has launched a scathing attack on BJP chief Amit Shah’s son Jay Shah over his business dealings, Congress leader Prithviraj Chavan has sought the info if he was aware of the demonetisation decision of the Centre beforehand.
“This is nothing but crony capitalism by the BJP. Why did Jay Shah close down his company a day before demonetisation was announced? Was he aware of what was going to happen in advance?” Chavan sought to know.
According to Chavan, either Amit Shah or Finance Minister Arun Jaitley should clarify how Jay Shah’s company increased its business manifold after the BJP came to power at the Centre in May, 2014.
“Jay’s company did not have any previous experience in windmills or in the renewable energy sector. Yet, the union minister, Piyush Goyal approved the huge loan against a collateral security of just Rs 6 crore,” he said.
“This raises many questions which cannot be shrugged off by filing a defamation suit. Amit Shah himself should answer whether he misused his position. These dealings should be probed by the Enforcement Directorate and the CBI,” Chavan said.
The Congress also demanded a probe monitored by the Supreme Court into the media report which wrote about the business dealings of Amit Shah’s son Jay Shah.
“Either Amit Shah should immediately step down from his post or he should be relieved from the charge as the party president, so that allegations of irregularities levelled against his son Jay Shah’s company could be probed independently,” AICC spokesperson Pawan Khera demanded.
He further suggested that a commission comprising two sitting judges of the apex court be set up for an independent and credible probe into the matter.
“Modiji had said ‘na khaunga, na khane dunga’? (will not engage in corruption myself, nor allow others), but now the question is being raised over his party president’s son.
“It is the right of the country’s people to know the truth behind what was claimed in the media report regarding his (Jay’s) company,” Khera said.
He also questioned why a Union minister (referring to Railway Minister Piyush Goyal) came out to defend Jay Shah, who is neither a minister in the union cabinet nor a BJP officer-bearer.
The BJP, however, came out in strong defence of Jay Shah and rejected the allegations against him.
However, it has to be seen how far the party was able to tide over the crisis as it has to go to electorate first in Gujarat by the year-end and then to the entire country a year later for seeking re-election to form the government at the Centre.