Exclusive: Doodhwala Vendors File FIR Against ‘Absconding’ Founders For Unpaid Dues

Exclusive: Doodhwala Vendors File FIR Against ‘Absconding’ Founders For Unpaid Dues

SUMMARY

Doodhwala had shuttered its operations in October

The company has sold customer deliveries and wallet balance to FreshToHome

Sources told Inc42 Doodhwala employees haven’t been paid salaries since August 2019

At a time of widespread distress for milktech startups in the country, VC-funded milk delivery startup Doodhwala had to shut down its operations last month. However, the company allegedly owes crores to employees and vendors after selling off its customer debt and orders to FreshToHome.

People familiar with the development told Inc42 that the company couldn’t raise fresh funds and hence faced issues in daily operations. Sources told us a group of vendors has taken the matter to the police and filed a first information report at the Ulsoor Police Station in Bengaluru against Doodhwala founders Aakash Agarwal and Ebrahim Akbari. Inc42 has reviewed the copy of FIR and email correspondence.

More Than INR 6 Cr Unpaid To Vendors

One vendor told Inc42 that Doodhwala allegedly owes INR 6-7 Cr to around 30-35 vendors, which includes 10 milk delivery vendors and other grocery and logistics vendors. Some vendors stopped supplying products to the company in September due to unpaid dues. However, vendors claim that they haven’t heard anything positive on the payments front from Doodhwala, ever since FreshToHome took over responsibility of Doodhwala customers.

Vendors allege that Agarwal and Akbari have absconded as their phones are off and they are not available at their residential address in Bengaluru. They also claim that Doodhwala shut its call centre down in October and there’s no way to reach company representatives. Another vendor said cheque payments of INR 9.6 Lakh have already bounced twice.

Unpaid Salaries Of Over 100 Employees

Other Inc42 sources said that Doodhwala employees were told about a delay in salaries in May 2019, which continued into June and salaries were finally paid in July.

But since then employees haven’t received any salaries. Some employees were laid off on August 27 with assurances that dues will be cleared soon.

Leaked internal emails accessed by Inc42 show that CEO Akbari promised to compensate employees for their work and also emphasises with promises to pay back dues and saying that they haven’t sold off the company to FreshToHome and hence, have no money to pay the dues.

Most recently, on November 12, Akbari told employees in another email that FreshToHome has only signed a non-exclusive licensing agreement under which amounts in Doodhwala customer’s digital wallets were shifted to FreshToHome. “Thereby, FTH has not paid for buying the business but have taken over customer liabilities ONLY,” the email said.

Other sources told Inc42 that since April, the company hasn’t made its employee provident fund contributions or income tax payments.

Sources added that despite issues in terms of management and overall operations on a company level, there had been no issues with day-to-day deliveries to customers. After the transition to FreshToHome, some customers claimed to be unable to withdraw wallet balance.

Inc42 reached out to Doodhwala CEO Akbari for his comments on the allegations and the FIR in Bengaluru. However, we didn’t receive a response till the time of publishing. We will update the article as and when the response comes.

You have reached your limit of free stories
Become An Inc42 Plus Member

Become a Startup Insider in 2024 with Inc42 Plus. Join our exclusive community of 10,000+ founders, investors & operators and stay ahead in India’s startup & business economy.

2 YEAR PLAN
₹19999
₹7999
₹333/Month
Unlock 60% OFF
Cancel Anytime
1 YEAR PLAN
₹9999
₹4999
₹416/Month
Unlock 50% OFF
Cancel Anytime
Already A Member?
Discover Startups & Business Models

Unleash your potential by exploring unlimited articles, trackers, and playbooks. Identify the hottest startup deals, supercharge your innovation projects, and stay updated with expert curation.

Exclusive: Doodhwala Vendors File FIR Against ‘Absconding’ Founders For Unpaid Dues-Inc42 Media
How-To’s on Starting & Scaling Up

Empower yourself with comprehensive playbooks, expert analysis, and invaluable insights. Learn to validate ideas, acquire customers, secure funding, and navigate the journey to startup success.

Exclusive: Doodhwala Vendors File FIR Against ‘Absconding’ Founders For Unpaid Dues-Inc42 Media
Identify Trends & New Markets

Access 75+ in-depth reports on frontier industries. Gain exclusive market intelligence, understand market landscapes, and decode emerging trends to make informed decisions.

Exclusive: Doodhwala Vendors File FIR Against ‘Absconding’ Founders For Unpaid Dues-Inc42 Media
Track & Decode the Investment Landscape

Stay ahead with startup and funding trackers. Analyse investment strategies, profile successful investors, and keep track of upcoming funds, accelerators, and more.

Exclusive: Doodhwala Vendors File FIR Against ‘Absconding’ Founders For Unpaid Dues-Inc42 Media
Exclusive: Doodhwala Vendors File FIR Against ‘Absconding’ Founders For Unpaid Dues-Inc42 Media
You’re in Good company