Tarnaka resident booked for cheating business partner by diverting Rs 1 crore

Hyderabad: The Uppal Police has recently registered a cheating case against a man for allegedly duping his business partnership by fraudulently diverting more than Rs 1 crore from company funds.

The complainant said that a person named Jaipal Reddy failed to honour his work share of the business partnership resulting in losses and it put her in danger of losing her property to the bank. She also accused him of diverting funds to other firms run by him and his family members.

Victim took home loans to start the business

In her complaint, Vatsala Reddy from Venkatapuram said that she met Jaipal Reddy Chiluka, a resident of Tarnaka in Secunderabad, at Landmark Worldwide Breakthrough Technologies, where they did a course together from 2012 to 2017.

Impressed with Jaipal’s business ideas, Vatsala Reddy joined him in starting a small-scale business, funding it through loans and borrowing from relatives as she had no regular income.

In 2019, Jaipal Reddy and Vatsala Reddy established Bomax Enterprises Private Limited in Ramanthapur, Uppal, specialising in manufacturing and supplying Blister Boxes and Blister Trays.

The initial investment was Rs 4.91 lakhs, of which Rs 3.41 lakhs was invested by Jaipal Reddy and Rs 1.50 lakhs by Vatsala. They obtained a term loan of Rs 9 lakhs from the Punjab National Bank, pledging her property as collateral. They also took additional loans from others. While Vatsala Reddy handled customer relations, Jaipal Reddy managed manufacturing and finances.

Victim's limited participation helped Jaipal

Due to health issues, Vatsala Reddy started working from home in 2020, limiting active participation. She was informed by the bank that their company had failed to remit the EMI for the loan. Shocked, Vatsala Reddy contacted Jaipal Reddy, who confirmed the company’s financial standing and assured her he would remit the payments soon. Vatsala Reddy expressed her dismay at not being informed earlier and he explained that he had withheld this information to avoid adding to the stress due to her health and family issues.

Surprised by this response, Vatsala Reddy visited the office on February 9. The staff, following Jaipal Reddy’s instructions, refused her entry. When Vatsala Reddy contacted him, he promised a meeting upon his return from travel. Meanwhile, she received more calls from the bank about the pending EMI payments. Concerned for her property, she attempted to contact Jaipal Reddy but received no response.

Brother-in-law became mediator

After two weeks, Jaipal informed her that his brother-in-law would attend a meeting on February 21 to address the issues. During this meeting, Jaipal Reddy admitted the company’s poor state and agreed to share the accounts over email, which he repeatedly postponed. Eventually, he provided an incomplete hard copy and insisted she visit the office for the soft copy.

Upon reviewing the accounts, Vatsala Reddy discovered that Jaipal Reddy had fraudulently diverted Rs 1,05,46,128 to his company Sri Laxmi Enterprises and his wife’s company Bomax Enterprises. When confronted, he angrily asserted his majority stake and ownership rights, claiming she had no authority to question him. She informed the mediator about the fund diversion.

A meeting was scheduled on April 14 where they discussed selling the company’s machinery to repay the loans and winding up the company. Both Jaipal Reddy and Vatsala Reddy agreed to this plan. However, Jaipal ceased responding to her calls, and the mediator repeatedly postponed further action. Under intense pressure from the bank and to protect her property, she had to sell her land and borrow from relatives to repay the loan.

Despite her desperate situation, both Jaipal and the mediator evaded responsibility and stopped responding to her calls. Feeling helpless, she visited the company to meet Jaipal, who reacted aggressively and threatened her for involving his brother-in-law as the mediator. He further asserted his societal influence leaving her stunned and intimidated. With no option left, Vatsala Reddy approached Uppal police and requested necessary action against Jaipal Reddy and his wife Chaitanya (his wife), and Raja Prathap Reddy (his brother-in-law) for cheating, diverting funds, and threatening her with dire consequences.