Lucknow, March 27: The Uttar Pradesh government has annulled its memorandum of understanding (MoU) with Punch AI, prioritizing transparency and good governance. The decision comes after a review of the MoU, signed on March 23, revealed significant compliance issues.
The investment promotion agency, Invest UP, announced on the social media platform X that the necessary documents and information requested from the investor were not provided in a timely manner. During the due diligence process, it was found that the company lacked a credible financial basis suitable for such a large project, raising concerns about its net worth.
Following these findings, the state government ordered the immediate cancellation of the MoU, clarifying that no rights or obligations related to the agreement remain. The MoU was initially aimed at establishing an AI Park in the state with an investment of approximately ₹25,000 crores.
Prior to this cancellation, questions had been raised regarding the financial and operational capabilities of the startup. Reports indicate that Punch AI is a relatively new company with an annual income of less than ₹50 lakh.
Chief Minister Yogi Adityanath had previously stated that the MoU signed through Invest UP is merely a preliminary step and does not guarantee final approval or implementation of any project. He emphasized that the MoU serves as an initial move to explore possibilities, followed by detailed investigations and evaluations.