The Central Bureau of Investigation has registered a case against REI Agro Ltd., said to be the largest basmati rice processing and marketing company in the world, and its directors for allegedly causing a loss of Rs. 3,814.39 crore to a consortium of 15 nationalised banks led by UCO Bank.
“The case of alleged conspiracy, cheating and forgery has been registered against the company and its directors, Sanjay and Sandeep Jhunjhunwala, N.K. Gupta and K.D. Ghosh. It is alleged that the firm operated through a web of shell companies for conducting fraudulent transactions in rice trade. Suspected diversion of funds raised through bank loans is being probed,” said a CBI official.
On Tuesday, CBI teams conducted searches on the premises of the company and its directors in Kolkata and Delhi, and also at its three rice processing units at Rewari in Haryana.
The action has been taken on the basis of a complaint lodged by UCO Bank alleging that 2013 onwards, the company had taken loans to the tune of Rs. 3,814.39 crore from the consortium of nationalised banks through fraudulent means.
Set up in 1994, the company was a co-sponsor of Delhi Daredevils cricket team in the Indian Premier League-2013 tournament.
Once listed in the London and the Singapore stock exchanges, the firm ran about 400 super stores under the brand 6TEN in India, said the official, adding: “It allegedly defrauded banks in India and abroad. The company was also sued by Singapore-based leading global financial services company Credit Suisse for recovery of $80 million,” said the official.
The case is understood to be part of the CBI’s action against private firms which allegedly duped nationalised banks.
The agency had recently registered a corruption and criminal conspiracy case against liquor baron Vijay Mallya and the chief financial officer of Kingfisher Airlines for alleged default of Rs. 900-crore loan in connivance with unknown officials of IDBI Bank.
Another such case was filed against Surat-based fleet operator firm Siddhi Vinayak Logistics Ltd. and Bank of Maharashtra for alleged default of Rs. 800 crore.
