In the latest twist in the Reliance Capital saga, local media reports in India suggest that the company is about to sue its former auditor PwC for defamation, claiming INR 100bn ($1.4bn) in damages. It is also being suggested that shareholders in Reliance Capital may bring a class action suit against PwC citing the slump in their investment values since the auditor’s resignation.
PwC had informed the Ministry of Corporate Affairs citing the provisions of section 143 (12) of the Companies Act – this section deals with resignation of an auditor in cases where fraud is suspected. Reliance Capital fired back at PwC earlier this month, saying there were no such irregularities in its accounts. The company also sought legal opinion and, it would appear, has now taken matters a step further.
