On October 25, the Mumbai Police had directed CCD to shut its doors to representatives of QNet, accused of involvement in Rs 425-crore fraud and its franchise.
One of the franchise of QNet, the Hong Kong-based multi-level marketing has challenged the ban of CCD in the Karnataka High Court, says a PTI report.
Two months before Mumbai Police ordered coffee chain Cafe Coffee Day (CCD) to shut doors to representatives of QNet.
"Vihaan Direct Selling (India) Pvt Ltd has moved the Karnataka High Court challenging the ban imposed by the Mumbai Police," said, Pradeep Gharat, Special Prosecutor. Vihaan, in its petition, has said their legal and constitutional rights were violated because of the ban.
"We will be filing a detailed reply in the Karnataka High Court stating that the Mumbai Police has not restricted any individual from entering the coffee shop. However, the ban is only for taking part in business activities and indulging in any further criminal activities," added Gharat.
The reply will be filed in the Karnataka High Court in due course of time, he said.
He also said that the issue of jurisdiction of the Karnataka High Court will also be raised before the court as the offence was registered in Mumbai.
On October 25, the Mumbai Police had directed CCD to shut its doors to representatives of QNet, accused of involvement in Rs 425-crore fraud, and its franchise after it discovered that representatives and employees of the beleaguered company and its associated firms often frequented the city-based outlets of CCD to lure prospective members.
The Economic Offences Wing (EOW) has so far arrested ten persons for allegedly duping investors by offering to sell products like magnetic disks, herbal products and holiday schemes through fraudulent practices.
Former billiard champion Michael Ferreira and Bollywood actor Boman Irani's son Danesh have been under scanner of the EOW as they were also found to be allegedly associated with the firm, according to sources.
QNet has also been accused of using the banned binary pyramid business model for their multi-level marketing schemes to entice investors.
An FIR in the case was registered in August last year. The accused have been charged with cheating and forgery under relevant sections of the Prize, Chits and Money Circulation Schemes (Banning) Act, 1978.
The EOW had issued look out notices against QNet founder Vijay Eswaran, Michael Ferreira and three business associates, the sources added.
Ferreira turned up before the investigators, who recorded his statement for his alleged role in the case.