Borrowing: Competition Commission Rejects Complaint against SBI

Competition Commission of India (CCI) has dismissed allegations that public sector lender State Bank of India (SBI) abused its dominant market position by imposing unreasonable and unfair conditions on car loan borrowers. The complainant had alleged that SBI was abusing its dominant position by not informing car loan borrowers in advance about papers required to be signed for availing a loan and compelling them to sign various standard forms which contained one-sided terms.

The CCI held that SBI did not appear to be in a dominant position in the relevant market. The Commission noted that vehicle loan market in India is largely competitive with the presence of many big players from public sector banks, private sector banks and foreign banks in addition to non-banking finance companies and cooperative banks.


Bank Deposits: Minimum Balance Charge

As part of a consumer protection initiative, Reserve Bank of India asked banks not to levy penal charges on customers who don’t maintain a minimum balance in basic savings bank accounts. “Banks should also not take undue advantage of customer difficulty or inattention,” RBI governor said recently. “Instead of levying penal charges for non-maintenance of minimum balance in ordinary savings bank accounts, banks should limit services available on such accounts to those available to basic savings bank deposit accounts,” he said.


Prithvi Info founder asked to testify before US Bankruptcy Court

The US Bankruptcy Court has ordered examination of Madhavi Vuppalapati, founder of the once high flying Prithvi Info Solutions, saying, as President and CEO, she is certainly a person with knowledge of the company’s financial condition

A Bankruptcy Court in the US has directed Madhavi Vuppalapati, founder of Prithvi Information Solutions Ltd to make herself available for an examination under the Federal Rule of Bankruptcy Procedure before 8 May 2014. The case related to a suit filed by Kyko Global Inc seeking to recover damages of over $18 million from Prithvi Info Solutions, which was once a high flying part of India's software story and had been purchased by many top foreign funds. Strangely, despite so much of activity to bring Prithvi to book in the US, the story is hardly reported by India's main stream media.


In its order issued on 8 April 2014, the US Bankruptcy Court for Western District of Pennsylvania said, "Vuppalapati, as the debtor’s (Prithvi Info) President and CEO, is certainly the person with knowledge of the debtor’s financial condition. After all, she is the individual that declared, under penalty of perjury, that the contents of the debtor’s bankruptcy petition and its related filings and disclosures are true and correct. Hiding behind procedural safeguards designed to protect third-parties, Vuppalapati forgets her role in this case. Given Vuppalapati’s role with the debtor, this Court finds that she is the appropriate person to testify with respect to the matters set forth in Kyko’s Notice, and Kyko has shown sufficient cause for this Court to compel the Debtor to be examined under Bankruptcy Rule 2004 (d)."


Last month, the Sheriff from King County auctioned personal assets of Madhavi Vuppalapati to recover $17 million as per directions from a US District Court.


In its Judgment on 6 September 2013, the District Court had said, “Judgment should be entered against Prithvi Information Solutions Ltd, Prithvi Information Solutions International LLC, Prithvi Catalytic Inc, Prithvi Solutions Inc, Madhavi Vuppalapati, DCGS Inc, Inalytix Inc, Avani Investments Inc, Ananya Capital Inc, EPP Inc, Financial Oxygen Inc, Huawei Latin American Solutions Inc and L3C Inc in the amount of $17,568,854 ($17.57 million) plus prejudgment interest accruing at the rate agreed to between the parties at 2.45% per month in the total amount of $796,776, as confessed to by the Defendants.”


However, Prithvi and its associates including Vuppalapati failed to pay $17 million along with penalty charges. This lead to the Sheriff auctioning personal assets like Lexus car, jewellery and household good belonging to Vuppalapati on 20 March 2014.


In January, Kyko Global filed an application before the District Court at Ranga Reddy in Andhra Pradesh seeking execution of a decree sanctioned by the US District Court.


In the petition Kyko Global said that pursuant to a judgement by the US District Court at Western District of Washington, Seattle, Prithvi Info entered into a settlement agreement and agreed to pay $18 million to the company. Following the agreement, the US District Court on 6 September 2013 ordered that judgement be entered for $17.57 million, plus prejudgment interest accruing at the rate agreed to between the parties at 2.45% per month in the total amount of $796,776, as confessed to by Prithvi Info Solutions.


Kyko Global sought attachment of Hyderabad-based Prithvi House, the registered office of Prithvi Information Solution.


Last year Kyko Global had filed a fraud case against the Indian company in the Washington Court. In its petition, Kyko Global had alleged that Prithvi and its affiliates created fictitious, counterfeit customers to get an advance payment of $17 million from them. Moneylife earlier wrote a detailed story on Prithvi info solutions' fraud to Kyko. Read; Prithvi Info Solution founder's assets auctioned to recover $17 million penalty.


In three separate affidavits, Madhavi Vuppalapati, Prithvi Information Solution and its managing director Satish Vuppalapati accepted that, "Certain guarantees were signed by debtors, including myself, in favour of Kyko to secure debt obligations and liabilities owed to Kyko. I acknowledge and agree that as of 25 June 2013, for good and valuable consideration, I am indebted to Kyko in the amount of $18 million plus legal fees, costs, and interest calculated weekly on the total amount at rate of 2.45% per month beginning on 25 June 2013 and I agree to pay amount as demanded by Kyko."


In order to get money back, Kyko filed a lawsuit on 16 June 2013 against Prithvi at the US District Court. On 8 August 2013, Kyko moved the court for issuance of judgment in amount against defendants in pursuant to confession of judgment and the motion was granted by the Court.


At 10.19am Tuesday, Prithvi Info Solutions was trading 4.8% higher at Rs6.35 on the BSE, while the benchmark Sensex was marginally down at 22,483.

Moneylife earlier wrote about scandalous saga of Prithvi Information Solution as it was involved in all kinds of financial manoeuvrings read; Prithvi Info Solutions: Why regulators are silent over the scandalous saga?

Read more stories about Prithvi Information Solution and its frauds here,

Prithvi’s recent acquisition despite multiple scandals and losses raises a stink

Scam: SEBI Finally Wakes Up

Prithvi: No Disclosures

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