Mumbai: The Central Bureau Investigation's (CBI's) Economic Offence Branch Mumbai has registered a case against a private company and its directors for allegedly cheating Canara Bank to the tune of Rs 56.63 crores.
According to the CBI, a complaint was received from Amarjit Singh, deputy general manager, Canara Bank, Gandhinagar, alleging that the Ahmedabad-based borrower company through its directors and unknown persons conspired with each other and cheated Canara Bank, Ahmedabad to the tune of Rs. 56.63 crores by fraudulently availing credit facilities.
It is alleged that the company was engaged in manufacturing of aluminium shots, cubes and ingots, segregation of aluminum, copper, iron scrap and trading of all types of non-ferrous metal scrap. The said firm availed the credit in 2018 from Canara Bank, Ahmedabad.
"It is further alleged that for availing the drawing power the borrower had dishonestly & fraudulently submitted false and fabricated stock statements to the bank and availed the drawing power for which the borrower was not entitled and siphoned off the funds," said a CBI official.
As per the report dated September 26, 2022 of forensic auditor, the borrower had inflated the value of stock in the stock statements and drawn the excess banks finance.
"The borrower had also diverted the funds in violation of RBI circular. The borrower had utilized the funds for acquiring machinery during financial year 2018-2019 and 2019-2020. Thus utilized the funds for creation of assets/acquiring equities/debt instruments by violating the condition of sanction as the funds were not sanctioned for the sald purpose. The borrower also transferred the funds to group companies/subsidiaries by violating the terms of sanction. Thus the borrower has siphoned off the funds and utilized the funds for the purposes un-related to the operation of account," agency sources said.
"Thus, the accused directors dishonestly misappropriated the bank funds and thereby, cheated and caused wrongful loss to the tune of Rs. 56.63 crores to the Canara Bank and corresponding wrongful gain to themselves. The directors failed to service the installments and the interest of the loans and accordingly, the account turned NPA on March 31, 2021 and the same was reported to RBI on December 15, 2023," the official said.
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