DB Realty denies any suit being filed against them  

February 24, 2012

New twist in ongoing tussle between two former partners

Moneylife Digital Team

A day after UAE-based Etisalat announced that it planned to sue Indian realty major DB Realty for “fraud and misrepresentation”, the latter has issued a statement saying no suit has been filed against them.

A press release from DB Realty said, “DB Realty is in the business of real estate development and has no direct or indirect shareholding in Etisalat DB (EDB). No suit or claim has been filed against DB Realty since it was never party to any agreements or otherwise.” The press release also said that Etisalat’s exit will not affect the financials of DB Realty.

The statement comes a day after Etisalat declared it was going to sue DB Realty for fraud and misrepresentation, and has started legal proceedings in the Bombay High Court against Shahid Balwa, chairman of Etisalat DB (EDB); vice chairman Vinod Goenka and Majestic Infracon Pvt Ltd, a DB group company.

Etisalat said that it was “induced into its investment in the company that was then Swan, without any disclosure of the matters that are now alleged by the CBI (Central Bureau of Investigation) and Supreme Court to have occurred in connection with the obtaining of second generation (2G) licences by EDB”.

The overseas company said that the events occurred a year before it had invested in the joint venture and admitted that it is facing major losses due to its investment “despite having no hand in 2G scam”. The Dubai-based telecom major’s statement was followed by a joint declaration by Mr Balwa and Mr Goenka, who claimed that they had filed a suit against Etisalat for mismanagement with the Company law Board (CLB), but withdrew it because Etisalat promised to perform better. The promoters of DB Realty said that Etisalat did not keep its promise, and said that the JV company was facing FEMA investigations due to Etisalat’s investments; and added that “Etisalat will be held responsible for their wrongful acts”.