Pradhin Ltd Faces Scrutiny as CoC Approves Auditors Amid Siphoning Allegations

Total admitted debt stands at approximately Rs. 23.47 crore.

Reader Takeaway: Auditors appointed, but significant shareholder allegations of fund diversion require close monitoring.

What just happened

The 2nd Committee of Creditors (CoC) meeting for Pradhin Ltd, held on August 14, 2026, confirmed a 100% quorum of Financial Creditors. Key decisions included appointing a forensic auditor for Rs. 4.5 lakh plus GST and retaining the existing statutory auditor, Mr. S. Parth Shah, for pending compliances at a fee of Rs. 2.10 lakh. Operational expenses, including staff salaries and rent, were also approved.

Why this matters

These appointments are crucial steps in the Corporate Insolvency Resolution Process (CIRP). However, the CoC meeting was overshadowed by serious allegations from a shareholder, Mr. Mahesh, who claimed over Rs. 110 crore raised via equity/rights issues was siphoned or diverted. He also questioned the eligibility of two financial creditors, suggesting their funds might be for warrants, not debt.

The backstory

Pradhin Ltd is currently undergoing CIRP. The process involves a CoC comprising financial and operational creditors who aim to find a resolution for the company's debts. This meeting is part of that structured process to manage the company's affairs while investigating its financial health.

What changes now

The appointment of a forensic auditor means a deep dive into the company's transactions will commence. The Resolution Professional (RP) will examine the shareholder's allegations and has requested documentary evidence. The continuation of the statutory auditor will ensure ongoing compliances are handled.

Risks to watch

The primary risk is the potential validity of the shareholder's allegations. If proven, they could significantly alter the financial claims and the CIRP outcome. The eligibility challenge to financial creditors could also impact the CoC's composition and voting power.

Shareholder Allegations Detailed

• Fund Diversion: Allegations point to a siphoning of over Rs. 110 crore from equity/rights issues.
• CoC Eligibility Challenge: Questioning the classification of funds from two financial creditors, suggesting they are for warrants, not debt.
• Audit Scope Expansion: Request to include Rs. 128 crore in receivables and Rs. 56 crore in advances in the forensic audit.

Operational Updates

The RP has opened a new CIRP bank account with ICICI Bank and is transferring balances. The corporate office in Ahmedabad has been closed, with assets moved to the Chennai registered office.

What to track next

Investors should closely follow the findings of the forensic audit and the RP's investigation into the shareholder's allegations. Updates on the validity of financial creditor claims and any resolutions proposed for Pradhin Ltd will be critical.