[Archived] 40 Venky's Premises raided by Indian Tax Officials

[Kamy100]

I talked to someone at the Pune mirror this morning. The raids on Venky's are the biggest in the city's history and involved the raiding of all Venky's properties. The investigation team will be at the locations for at least 4 days but possibly longer. Raids are in connection with none payment of taxes and investigation has been ongoing for six months. Venky's had no idea. No arrests yet.

The correspondent said this was highly unusual as he tax system in India was corrupt and the big companies usually paid officials off. His analysis is that Venky's thought they were untouchable and that irked some high ranking tax official who decided to do something about it. Now it will be almost impossible for them to pay someone off to make this go away was his opinion.

Finally said that this would take years to go through the indian legal system. So interns of Venky's being forced to sell the club due to not being fit and proper that is not a realistic possibility anytime soon. 

[jim mk2]

Seems to me that although we're all enjoying seeing this lot being potentially hit in the pocket and suffering embarrassment and loss of prestige in India, there's no reason why it should have any bearing on their ownership of Rovers. 

[tomphil]

The hope has to be they flog the club to pay their fine or the BOI takes complete hold of it and sells it to get some of their borrowings back. If Venkys have been using it as a tax dodge that's over now so either way there's a faint hope of a get out clause for us.

Forget the football authorities doing anything they'll not get involved unless something flags up involving VLL in this country.

[philipl]

OK This IS very big news.

Any business subject to a raid of this magnitude (according to the article, officers expect to be on site for at least four more days) is paralysed.

The first indication of the paralysis is the cancellation of the AGM. The fact that the family didn't think they could safely pretend it was business as usual at the show case annual event or provide any satisfactory sets of weasle words tells you that VENKY'S ARE AS GOOD AS SHUT DOWN FOR NOW.

The impact on Rovers is immediate and devastating:

- Venky's were incapable of decision making at the best of times. Just as we need a lot of decisions to prepare for our humiliating loss of league status, WE ARE GOING TO GET NONE

- there might be bank freezes and seizures. Don't expect a penny more to flow from Pune to Blackburn any time soon if ever

This is a tax evasion investigation. How do you evade domestic taxes most efficiently?  Well, I am certainly not saying Venky's have ever done any of these things but the famous text book with the bright yellow cover "Tax Evasion for Idiots" says:  

1) buy an overseas sports club, get rid of the legitimate management, then you can run up outrageous losses legitimately and recycle some of the cash back home dressed up as incompetence,

2) get involved with extremely dodgy agents and trade players at undisclosed prices, the more complicated the deal and obscure the clubs you deal with the better. Oh and leave the agents in charge together with appointing local morons who can take the flak to add to the smokescreen,

3) gamble/bet like there is no tomorrow and if you can avoid the house taking too big a cut by "fixing" things through having an inside position on key information, so much the better, (How DID Trump manage to go bust four times running casinos???) 

4) have a Swiss subsidiary which looks incredibly ethical for the Swiss bank account or three... 

No doubt there is an incredibly suspicious tax inspector in Pune reaching for his yellow-backed copy right now.

Expect to have an excrutiating summer caused by the added paralysis in Pune and an even more excrutiating years long wait (if ever) for the Raos to be forced out of Ewood because of this.

   

 

[Neal]

Surely this can only be a good thing? If there are no funds to pay the bills then the quicker admin becomes a real possibility?

[MCMC1875]

....yep Neal, that's my point, with Venkys paralysed, it's likely that BRFC will run out of cash in the near future.

[Stuart]

47 minutes ago, lraC said:

Around 3 weeks ago a poster on this site E Mailed and posted a letter and documents to David Newton the head of integrity at the FA. This letter and documents, was a thorough breakdown of all the wrong doing at BRFC. So far this has been met with a wall of silence. Can this be ignored for much longer?

I hope there was a cc to the Sports Minister.

[Roverall]

We've got to get this in the English nationals

Poor old Raos. It is indeed a very sad event.

[jim mk2]

5 minutes ago, philipl said:

 

The impact on Rovers is immediate and devastating:

 

   

 

Philip, there will be no impact on Rovers - none whatsoever.

As you say in your post, there will be the same inaction and lack of decision-making and money, so nothing will change. 

[Baz]

1 minute ago, MCMC1875 said:

....yep Neal, that's my point, with Venkys paralysed, it's likely that BRFC will run out of cash in the near future.

Which could be a good thing if it forces them into selling, or could be worse than usual. No one knows yet.

[jim mk2]

Just now, Baz said:

Which could be a good thing if it forces them into selling, or could be worse than usual. No one knows yet.

More likely we'll be stuck at the back of the proverbial drawer, unloved and forgotten about. I doubt the they're so cash-strapped they need to sell us anytime soon, let alone at fire-sale prices. We're not costing them much money at present so they have no need to act. 

[DE.]

17 minutes ago, philipl said:

The impact on Rovers is immediate and devastating:

- Venky's were incapable of decision making at the best of times. Just as we need a lot of decisions to prepare for our humiliating loss of league status, WE ARE GOING TO GET NONE

- there might be bank freezes and seizures. Don't expect a penny more to flow from Pune to Blackburn any time soon if ever

Business as usual then?

[Baz]

Just now, jim mk2 said:

More likely we'll be stuck at the back of the proverbial drawer, unloved and forgotten about. I doubt the they're so cash-strapped they need to sell us anytime soon, let alone at fire-sale prices. We're not costing them much money at present so they have no need to act. 

Is that not where we are already? 

[Neal]

Just now, Baz said:

Which could be a good thing if it forces them into selling, or could be worse than usual. No one knows yet.

 

IMV There is no bad outcome from this. If we're stuck them afterwards then we're no worse off. If we can get this into the UK press then it's further bad publicity for them. If they lose money, have assets frozen, making it difficult to pay the bills then thats great. 

 

Put simply, whatever is bad for them is positive for us. 

[philipl]

4 minutes ago, jim mk2 said:

Philip, there will be no impact on Rovers - none whatsoever.

As you say in your post, there will be the same inaction and lack of decision-making and money, so nothing will change. 

If you listened to the BBC Radio Lancs programme, you would know you would have been correct had we scored 3 more goals last season.

But we didn't and income and cash flow are going over another cliff. There are no Henley or Duffy we can sell and league money disappears to virtually nothing. 

The impact of indecision and inaction now is certain relegation to League 2 next season.

 

[Sparks Rover]

The EFL has to take a good hard look at this and how the club is being destroyed.  What is the point of a points deduction? The owners dont care, so its punishing all the innocent parties.  They should force a sale of the club, or at least make a exception to some rules due to thefact that this is unprecedented and totally out of the control of anyone in Blackburn.  

 

 

[MCMC1875]

Where is the cash going to come from to pay the bills next season?

Without it, the club will go bust.

[philipl]

Just now, MCMC1875 said:

Where is the cash going to come from to pay the bills next season?

Without it, the club will go bust.

Sack everybody and play with kids. That is what we are facing without any strategic decision making and at least some pump priming cash.

We won't go bust but equally we will be lucky to get to 30 points in a league 1 season. 

[Dunnfc]

Just now, MCMC1875 said:

Where is the cash going to come from to pay the bills next season?

Without it, the club will go bust.

Needs 8 million extra income just to survive this year.

Expect to see some bridging 5 million loan @20% from a third tier lender such as Nucleas, Close, Blumarble etc types in exchange granting them a fixed charge on Ewood etc.

[tomphil]

Just now, MCMC1875 said:

Where is the cash going to come from to pay the bills next season?

Without it, the club will go bust.

Everyone through the door and youth team in with one coach probably. I think Plymouth years ago ended up in that kind of situation.

[JonnyP]

Obviously it's great to hear they're  in the @#/? with the Indian authorities but it also means they will be caught up dealing with that. We have 12 players to replace next season if not more depending on who we decide to flog. Trying to get any authority to do any deals will be a nightmare as no one at the club is allowed do anything without their say so. And I can't see them running to pick up the phone to deal with our mess while this is going on.

I wonder how TM's meeting in India is going to go now. The whole thing is a absolute shambles. you couldn't make it up

[47er]

Just now, philipl said:

If you listened to the BBC Radio Lancs programme, you would know you would have been correct had we scored 3 more goals last season.

But we didn't and income and cash flow are going over another cliff. There are no Henley or Duffy we can sell and league money disappears to virtually nothing. 

The impact of indecision and inaction now is certain relegation to League 2 next season.

 

There's certainly no Henley we can sell!

[gumboots]

2 hours ago, lraC said:

It may well affect Rovers all this. It was reported last week that Tony Mowbray was due to fly over to India, to meet with them and discuss the plan for next season. With the historic reluctance to even acknowledge anyone connected with Rovers, they are hardly going to suddenly want to discuss us, with all this going on? Given the £10m black hole for next season, this may well mean the rumoured none payments, may become more than just rumours and ,at well filter down to staff an players not being paid. If that does happen, I would hope the football authorities step in. If this turns out to be as big as it looks initially, how will the FA, football league ETC look, when we press home, how they chose to ignore the fans concerns.

Around 3 weeks ago a poster on this site E Mailed and posted a letter and documents to David Newton the head of integrity at the FA. This letter and documents, was a thorough breakdown of all the wrong doing at BRFC. So far this has been met with a wall of silence. Can this be ignored for much longer?

In answer to your final question, they'll ignore it for as long as they can regardless of evidence if their previous record is anything to go by

[philipl]

Just now, Dunnfc said:

Needs 8 million extra income just to survive this year.

Expect to see some bridging 5 million loan @20% from a third tier lender such as Nucleas, Close, Blumarble etc types in exchange granting them a fixed charge on Ewood etc.

There is a covenant prevent a lien over Ewood.

[perthblue02]

Fingers crossed Balaji's new husband in the Arthur Road Jail has an aversion to using lubricant