The Central Bureau of Investigation (CBI)’s probe into a bank fraud case, worth ₹409.26 crore, involving a Parbhani–based sugar-energy firm and others, revealed that a forensic audit of its financial transactions revealed several irregularities, including its grant of interest - free credit to another firm, which was allegedly meant to divert loan funds, agency source said.
A six-bank consortium, led by the public-sector UCO Bank, on whose complaint the CBI registered a case against the sugar – energy firm last week, had got the forensic audit conducted for the period during April 2011 to March 2017.
It was alleged that the accused firm had availed various credit facilities in the form of a term loan, working capital facility and other credit facilities from the bank consortium between 2008 and 2015.
Accused firm diverted funds via term loans
The audit alleged that the accused firm had potentially diverted funds obtained by way of term loans, availed excess drawing power in working capital by overstating net current assets in stock statement, which resulted in cash crunch for the firm and non-payment of dues to banks leading to its credit account turning into a Non –Performing Asset, a CBI source said.
“Abnormal financial activity of the accused firm was noticed with another firm. The accused company had not charged any interest on a firm, from which it had got receivable in the range of ₹80 crore to ₹125 crore during 2014-2015 to 2016-2017. It was an interest-free credit from the accused firm,” the source said.
“On the other hand, the company had paid interest at commercial rate to its banker for availing credit facilities. This was abnormal financial activity and it can be treated as diversion of funds to the other firm,” the source said.
“There were also alleged transactions with a ‘related party’, an engineering firm, which reflected purely money transactions not commensurate transactions of purchase and sales between them,” the source said.
Bank mis-utilised credit facilities
“The bank’s complaint to the CBI alleged that the accused firm mis-utilised the various credit facilities provided by the bank,” the source said. Five of the consortium member banks had classified the bank’s account with them as an alleged fraud. The agency's case was registered on last week on receipt of a written complaint, dated Nov 27, 2020, from an official of UCO Bank (Nagpur).
The CBI's First Information Report (FIR) invoked Indian Penal Code sections for alleged criminal conspiracy, read with common intention, and Prevention of Corruption Act sections for a public servant's criminal misconduct and obtaining, by corrupt or illegal means, for himself or for any other person any valuable thing or pecuniary advantage. “It was alleged that the accused have defrauded the bank, causing wrongful pecuniary loss of Rs409.26 crore to the complainant bank and other consortium banks,” the CBI source said.
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