Corporate governance issue back to haunt DLF

The stock of DLF will come under some pressure this week as social activist-turned-politician Arvind Kejriwal has accused DLF of favouring Robert Vadra, son-in-law of Congress chief and the UPA Chairperson Sonia Gandhi, with easy loans for some undue gains. According to Kejriwal, DLF had sold prime land at throw-away prices and gave interest-free loans to Vadra. DLF, however, denied any undue gains for the company or that there was any quid pro quo with the Congress-run governments and clarified that it has only business relationships with Vadra. The issue will once again bring the corporate governance adopted by DLF to the fore. Earlier this year, Canadian-based research firm Veritas accused DLF of undertaking “questionable related-party transactions” to boost the value of DAL (DLF Assets) prior to its acquisition by the company. It also accused DLF of inflating sales by at least Rs 11,236 crore and profit before tax by Rs 7,233 crore through its dealings with DLF Assets, a firm floated by the company's promoters.