Franchising in India has witnessed a four-fold growth since 2013 and is estimated at USD 50.4 billion currently. India has always remained as an emerging marketplace for franchise business and Covid 19 has added another feather in their cap, making money during this time had become an easiest job for the franchise’s ownership.
Trusting the ownership of Franchise, investing their hard-earned money with an expectation of getting a sustainable income for the months during the year had become a common thought of the people. Delhi NCR’s bustling markets greets you with the choicest of top brands. Many corporate professionals as well as an innocent salaried middle-class youth have been interestingly seen taking a plunge into this franchisee business.
The idea of franchising is to have an ownership of brand along with the superlative support from the team of experts. This takes your confidence of working in not so well-versed business to next level and positively uplift your understanding of the business indeed. One among the businesses who grew well from franchising was SGF (Spice, Grill and Flame).
The company was incorporated dated January 29th, 2019, with the main objective of providing food services and ancillary objective included the business activities related to this industry and having Liaison offices and services rendering. SGF’s Kewal Ahuja is one among those franchisee owners who had made money in this franchising business. Paid PR and advertisement clean his image on media and social media.
In front of the public, Kewal Ahuja has presented his business to the people in such a way that it had looked so appealing & profitable with high return value in minimum time frame. High returns & more than a sustainable revenue generation were offered by SGF Kewal Ahuja in his 2 modules of business FOFO & FOCO. The people who lost their jobs or others who were in need of some kind of income during the pandemic fell for this advertisement and invested lakhs of rupees in SGF franchises believing Kewal Ahuja. But he had not kept his word. The franchises were closed down and the investors were not given back their money.
A deep analysis has been done of SGF and its sister concern company Spice to bring out the truth and it highlight the facts as follows:
1. Both SGF and Spice are registered at same address.
2. Kewal Ahuja remains as Key management in both the company. Both are related parties; spice is a sister concern of SGF.
3. The sister concern- spice’s reported turnover for last 3 years is as follows:
It is clear from the reports that huge funds were abruptly collected from the franchisees and the fee collected by SGF, was not reported to regulators such as Income Tax Department and GST Council under regulatory filings. SGF is non-compliant in MCA filings as well. This report highlights the compliance irregularities and potential financial fraud. SGF in all these 3 years have reported NIL returns in GST and Income tax. However, the sister concern’s reported top line is mentioned above. This shows a potential angle of fund misappropriation by Kewal Ahuja.
SGF has a track record of statutory non-compliance as well. The details are as follows:
SGF was formed in year 2019 and first auditor was appointed on February 25th, 2019, however till march 2019, there was no available record with MCA for financial and annual filing.
Second auditor was appointed in SGF on 31/12/2020 for the period from 1st April 2019 till 31st March 2024, there is again no available record with MCA for financial and annual filing. The first auditor resigned in just few months and second auditor was appointed in extra ordinary general meeting, which raise an alarm.
SGF has not filed annual returns and financial statements with MCA for last 2 years which is a mandator exercise for every PVT. Ltd company in India. If there is a further non-compliance for third year, MCA may start the process of striking off suo moto. SGF has not initiated any e forms to correct the non-compliance which highlights the intent to no follow the going concern.
SGF has filed no returns the income tax returns for the last three years. If the company is collecting franchise fee, the company should be filing the profit and loss account with the income tax department even if the net profit is NIL. This may highlight malicious intent.
SGF has applied for 3 GST numbers. Out of these 3 GST numbers’ 2 are registered in Delhi and Haryana state and the status is INACTIVE. These GST numbers are cancelled by GST council suo moto. GST number of Mumbai is active however, there is no return filed by company since September 2021. SGF has inactive GST registration. So, the objective of collecting GST from franchisees indicates a malicious intent.
Kewal Ahuja is serving as Treasurer of BJYM Delhi Pradesh, and has a high hope of becoming a main lead politician. He uses his political power and influence to cover up his financial fraud and cheat money from innocent people. Therefore, be cautious and refrain from investing in this company to save your money.
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