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6. M/s. Pacific Convergence Corporation Ltd. had filed winding up petition no. 292/2004 against M/s. Data Access India Ltd. (hereinafter referred to as DAIL, for short) under Section 433(e) read with 434 of the Companies Act, 1956 (hereinafter referred to as Act, for short). The allegation was that DAIL had neglected and failed to pay the debt due. The Company Petition was admitted vide Order/Judgment dated 18th November, 2005 and the Official Liquidator attached to this Court was appointed as the Provisional Liquidator. It was recorded that the company- DAIL had lost its substratum and it would be just and equitable to wind up the company as there was no business activity and there was no prospect of revival.

10. The company-DAIL was granted permission to open an account with ABN Amro Bank, Chennai for the limited purpose of receiving investors C.P.No.292/2004 Page 5 money. Account No. 1130826 was opened and an amount of US $ 17 million was received on 18th August, 2004 in the said account from Data Access America Inc. (hereinafter referred to as DAAI, for short) which is a 100% subsidiary of DAIL. The case made out by Canara Bank is that this amount was paid by DAAI on account of debt due to DAIL which is charged/hypothecated with the said Bank and was contrary to the understanding permitting opening of a bank account with ABN Amro Bank with limited purpose of receiving investors‟ money. There is no dispute that DAAI was liable to pay and indebted to DAIL on account of services rendered.

„„The Company officials shall arrange for infusion of Rs. 75 crore by the investors money to set right the irregularities.‟„
65. As a follow up of the consortium meeting of 7th September, 2004, Canara Bank received letters dated 16th September, 2004, 17th September, 2004 and 21st September, 2004 and in the said letters also there is no mention of the receipt of any loan amount of Rs. 75 crore from the investors. Infact, in para 2 of the letter dated 21/7/2004, the Bank was informed that a sum of Rs. 83.81 crore is due from Data Access America to the Respondent Company as on 31/8/2004, which was not correct and was contrary to remittance of 17 Millions USD by Data Access America to Data Access India Ltd. on 19/8/2004 along with a swift message that the said payment was on account of the outstanding liability towards services rendered. It is relevant to mention that during this period i.e. in November, 2004, the Bank received copies of the letters addressed by the Chairman of the Respondent Company to Enforcement Directorate and to the Revenue Authorities, stating therein that the new management had fraudulently transferred funds of 'DAIL' to their own Companies. The said letter also mentioned that the amount of 17 Million US Dollars received in the account of „„DAIL' with ABN AMRO C.P.No.292/2004 Page 10 Bank, Chennai were receivables to be deposited with Canara Bank. In fact, after receiving the amount of 17 Million US Dollars on 19.8.2004, ABN AMRO Bank filed the Inward Remittance Certificate with the Reserve Bank of India the same day, i.e. on 19.8.2004, declaring that the remittance was received on the account of the respondent Company against outstanding bills of services rendered. It is further submitted that under the provisions of Section 6 read with Section 47(2) of FEMA, read with Foreign Exchange Management (Borrowing or Lending in Foreign Exchange) Regulations 2000, there is a prohibition to borrow or lend any foreign exchange. The Relevant Regulation 3 framed under the said Act reads as under:-

(a) The amount was received in the account of the company maintained with ABN AMRO Bank.

(b) The amount was received through its subsidiary Data Access America Inc. Whether it was a loan given by Odyssey Re, that too with conditions, is a matter which needs a thorough probe. It is also possible that as Data Access America has to make substantial payments to the company, it borrowed the money from the said parties for making payment to the company.