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Mumbai: Four booked for embezzling society funds in Worli

According to the FIR lodged with Worli Police station, a forensic audit conducted by the residential society has unfolded a scam worth Rs 1 crore

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Mumbai: Four booked for embezzling society funds in Worli
Pankaj Mansion
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The residents of a tony housing society in Worli have been paying more for their cable TV and Wi-Fi services. This they came to know after an internal audit was carried out by the committee. Apart from this, the society members also found discrepancies in maintenance work carried out in the building which was carried out between 2010 to 2015. Now, an FIR has been lodged against former committee members by the secretary of this society — Pankaj Mansion.

According to the FIR lodged with Worli Police station, a forensic audit conducted by the residential society has unfolded a scam worth Rs 1 crore. This was allegedly committed by the society's former committee members for over five years without anyone's knowledge. Neither did the fraud come to light when the registers and other documents of Pankaj Mansion building were scrutinised by the auditors. The secretary of the said building, Mangilaal Jain (64) registered a complaint against four people who were then committee members of the society. The accused in this case are former treasurer Bharat Jain, and three other members of the society namely Pankaj Khullar, Jagdish Badlani and Vimlesh Kabra.

According to the Worli police, in 2013 the previous committee members resigned after expiration of their term and Jain took the interim charge till a new body was appointed by the manager of the building. After being elected, Jain who was performing executive duties discovered that the registers, records, finance related documents and other papers showed many inconsistencies and there were several loopholes when monetary transactions were tallied. In order to establish what went wrong, the committee decided to conduct a forensic audit of the documents and records from 2008 till 2013.

"In September 2015, the auditors gave their final report to the committee which highlighted that payments made by the building for the cable and internet connections, maintenance and repair works and advertising agencies to put up hoarding near their premises had many irregularities and a significant amount of money was embezzled by someone. The report mentioned that in 2013, the building received a bill of Rs 24.35 lakhs for cable connections of all three wings from a cable operator, on which Rs 12 lakhs were allegedly overcharged. Also, the society had not issued any tender notice for the cable service provider but the accused men released the payment without the consent of the society thereby causing loss to the residents," said a police officer.

For 115 cable connections, bills of 143 connections were made which highlighted that the service provider levied higher tariff rates to the users than the usual one. Jain told DNA that approval for internet connection in the society was never sanctioned but then too, Rs 19 lakhs were separately misappropriated by charging high rates to the users.

"When the chairman confronted the service providers, they informed that the members of the committee deliberately asked them to charge high rates and later send their cut to them after the payment was released from society funds. The fraud set up for internet connection gave no tax relief; thus, additional Rs 2 lakhs were paid as tax to service providers," added Jain.

As per police reports, the committee members undertook maintenance and repairs work of the building from 2010 till 2013 and allocated a fund of Rs 75 lakhs without taking anyone into consideration. The contractors hired offered cheap rates of work and when the final bill was submitted, it had no service tax and Value Added Tax (VAT) numbers which deepened the suspicion of the accused men doing fraud. Badlani signed all the bills of repair works and Khullar looked after the cable and net connection affairs, said the police.

"The accused men is also alleged to have used society funds for their personal works. Minutes of meeting records, society registers and all other documents show faulty transactions. We have registered a case under section 120-B, 34, 379, 406, 409, 420, 465, 467, 468, 471, 474 and 477-A of the Indian Penal Code. Action shall be initiated in the case after proper investigation," the officer added.

MISAPPROPRIATION

  • For  115 cable connections, bills of 143 connections were made 
     
  • Rs 19 lakhs were misappropriated by charging high rates for internet connection
     
  • They allocated Rs 75 lakhs for building repair without taking anyone into  consideration
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