The Central Bureau of Investigation (CBI) on Wednesday searched the premises of Chennai-based Kanishk Gold Private Limited (KGPL) and its directors in Chennai and Kancheepuram, including that of KGPL promoter-director Bhoopesh Kumar Jain.
The agency action followed complaints by a consortium of 14 banks, led by State Bank of India (SBI), of having been cheated to the tune of ₹824.15 crore by KGPL. Statutory auditors and stock auditors have also been accused of having failed to report the irregularities.
The SBI has alleged that it had an exposure of ₹240.46 crore to Kanishk Gold as on December 31, 2017. While the Punjab National Bank (PNB) had to recover ₹128 crore, Syndicate Bank had an exposure of about ₹55 crore, the Union Bank of India around ₹54 crore and the IDBI Bank at ₹49 crore.
The company’s loan amounts were taken over by the SBI from ICICI Bank in 2008. In March 2011, it became a multiple banking arrangement and the next year, a consortium was formed.
“The company’s banking exposure was periodically increased and the enhancement of working capital limits was based on reported growth of current assets and sales of the company. As on March 31, 2008, the company’s current assets stood at ₹24 crore, which was reportedly increased to ₹980.08 crore as on March 31, 2016,” alleged the complaint. The first sign of KGPL’s financial problems were noticed when it allegedly delayed servicing interest for March 2017 to eight member banks. Interests were also not paid to all the member banks for the next month, as alleged.
