CBI Books Pvt Company, Directors In ₹30 Crore Indian Bank Fraud Case

Mumbai, April 29: The Central Bureau of Investigation (CBI) has registered a case against a private company and its directors for allegedly causing loss of around Rs 30 crore to the Indian Bank.

According to the CBI, a complaint was sent on March 30 by N.C. Nehra, Deputy General Manager, Indian Bank, stressed assets management branch, Mumbai, alleging that the Pune-based borrower company that was involved in providing high-quality engineering, procurement, instalment and commissioning services to India's power sector, both in the public and private domain, and its directors and unknown others entered into a criminal conspiracy during the period 2017 to 2018, to cheat the Indian Bank with dishonest and fraudulent intentions.

Alleged false statements submitted

The borrower company submitted incorrect stock and book debt statements as trade receivables, presented by the borrower to the bank, which were not commensurate with the cumulative turnover reflected in GST returns of the company.

The borrower company, dishonestly and fraudulently, inflated receivable figures in its stock and book debt statements that were submitted to the bank in order to avail more drawing power.

Furthermore, the borrower company continued to show transactions with entities from which it was not receiving any payment.

Funds allegedly diverted

“The borrower company did not submit the stock statements after March 2018. The borrower company maintained banking relationship with several other banks without any intimation to the Indian Bank. The borrower company routed business transactions through bank accounts maintained with other banks without prior permission of the lending bank and also applied for credit facilities after availing loan from Indian Bank. In pursuance of the said criminal conspiracy, the borrower company and its directors with dishonest and fraudulent intentions diverted and utilised the disbursed funds for purposes other than for which funds were sanctioned,” said a CBI official.

Borrower company and its directors intentionally and dishonestly deceived the Indian Bank to make it believe that the borrower company had genuine businesses and it had means to repay the loan amount. Thereby the borrower company induced the Indian Bank to sanction and disburse loan to itself without any intention to repay the loan amount.

Account declared NPA

Thus, the borrower company represented by its directors cheated the Indian Bank and misappropriated bank funds causing wrongful loss to the tune of Rs 29.97 crore to the bank and corresponding wrongful gain to themselves.

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The directors of the borrowing company failed to service the instalments and interest of loans and accordingly, the account of the company was classified as NPA in May 2018 by Indian Bank. The account was reported as fraud by Indian Bank to RBI in March 2020.

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