Bain Capital Partners, along with 10 other subsidiaries, is suing EY, known as Ernst and Young until 2013, in the U.S. for recommending that the Boston-based company invest in an Indian kids-wear company, Reuters reported Friday.

Boston-based Bain claims that it invested nearly $60 million for a 30.99 percent non-controlling stake in Lilliput in 2010, based on false financial statements -- which were audited and certified by EY -- furnished by the apparel maker. TPG, a Texas-based private equity firm, also bought a 45 percent stake in Lilliput and had invested $26 million in New Delhi-based Lilliput, Reuters reported.

According to Reuters, which cited lawsuit documents filed in Massachusetts' Suffolk County Court, Bain claims that its investment has been “rendered worthless” adding that, “Lilliput's fraud grew with EY's active assistance.” Bain is suing EY on accounts of “fraud, aiding and abetting fraud, negligent misrepresentation, and unfair and deceptive trade practices based on EY's involvement in the scheme to defraud Bain.”

Bain reportedly had planned to help Lilliput expand its operations in the country and later guide it to an initial public offering, until a whistleblower came forward to disclose that Lilliput had inflated its numbers. Bain then followed up the claims with its own investigation before cancelling plans for an IPO.

EY has denied all of Bain's accusations and said in a statement: "These allegations of wrongdoing are baseless and EY will vigorously defend this matter," according to Reuters.

The lawsuit also reportedly claims that New York-based EY's long-standing relationship with Bain allowed it to specifically target Bain because it knew the latter could pay a better price for a stake in the Indian company.

“EY knew about the key aspects of the fraud, yet assured Bain about Lilliput's financial statements. In reliance on the false financial statements and EY's false audit opinions, Bain invested in Lilliput,” the Bain complaint said, according to Courthouse News, a Pasadena, Calif.-based news service.

“EY shared details of its planned audit procedures with Lilliput in advance and even allowed Lilliput to perform certain audit testing on itself. EY failed to conduct adequate procedures relating to the key components of the fraud including sales, inventory, cash, and loans,” the lawsuit reportedly claims, adding that Lilliput tried several times to obstruct Bain's investigation into the matter.