Mumbai: CBI books private company, directors in Rs 631 cr Bank of India fraud case

Mumbai: CBI books private company, directors in Rs 631 cr Bank of India fraud case

According to the CBI, the company is engaged in manufacturing of industrial induction furnaces, induction heating equipment, transformers and metal refining converts.

Somendra SharmaUpdated: Wednesday, January 05, 2022, 05:45 PM IST
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CBI | Photo: Representative Image

The Mumbai Branch of Central Bureau of Investigation (CBI) has registered a criminal offence against a private company, its four directors and unknown public servants for allegedly causing wrongful loss of Rs 631.97 crores to the Bank of India.

The bank in it's complaint to the CBI had alleged that the accused persons in pursuance of a well-knitted criminal conspiracy and with dishonest intention of causing wrongful loss to the bank and wrongful gain to themselves, diverted, siphoned off the funds amounting to Rs 631.97 crores from the credit facilities disbursed to them and thereby dishonestly misappropriated the loan amount.

According to the CBI, the company is engaged in manufacturing of industrial induction furnaces, induction heating equipment, transformers and metal refining converts. A written complaint was received by the CBI from the deputy general manager of the Bank of India against the company and other accused persons, alleging wrongful loss of Rs 631.97 crore to the bank. "The gist of allegations made in the complaint is that the accused entered into a criminal conspiracy during the period from 2007 to 2013 to defraud/cheat the bank in the matter of various credit facilities extended by it," the CBI's FIR stated.

"The company was enjoying Fund and Non Fund based credit facilities aggregating to Rs 703.89 crores exclusively from the bank as per last sanction in October 2011. The company started facing liquidity problems in April 2011 and the company failed to pay its dues despite restructuring of the account. Subsequently, the account of the company was classified as NPA by the bank in December 2012. As per the forensic audit of the company conducted by the bank, the company was involved in diversion, siphoning off funds through its subsidiary, associate companies having common directors," the FIR further stated.

The bank also alleged in their complaint that the company also indulged in transactions with suspicious dealers who were involved in issuing fake bills without delivery of goods. The CBI has registered a case under sections 120B (criminal conspiracy) and 420 (cheating) of the Indian Penal Code and relevant sections of The Prevention of Corruption Act.

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