The Central Bureau of Investigation (CBI) has registered a case against GTL Infrastructure and unknown officials of 13 banks for allegedly “causing losses running into hundreds of crores”.
The case is based on a preliminary inquiry initiated last year to verify the allegation of financial impropriety and irregularities in the matter of credit facilities extended by a consortium of 19 banks/financial institutions to GTL Infrastructure, which belongs to Global Group Enterprise promoted by Manoj Tirodkar, as per the First Information Report (FIR).
It is into the business of building, operating and maintaining passive telecom infrastructure sites capable of hosting multiple service providers.
According to the CBI, in 2011, the company had expressed its inability to service interest or instalments on the credit facilities. It was referred for Corporate Debt Restructuring (CDR). The CDR empowered group approved the package for restructuring on December 23, 2011. However, the move failed and thereafter, the lenders decided to invoke Strategic Debt Restructuring (SDR) in 2016.
During CDR and SDR, out of the total outstanding of ₹11,263 crore, debt to the tune of about ₹7,200 crore was converted into equity shares, thereby leaving an outstanding amounting to ₹4,063 crore.
It is alleged that the company had diverted a substantial amount of the loans through related parties having common directors and addresses. The funds were invested in European Projects and Aviation Limited or GTL or its sister concern Chennai Network Infrastructure Limited from 2011-12 to 2013-14. In 2018, GTL had an outstanding of ₹4,063.31 crore towards the lenders.
The FIR alleged that a proposal for the sale of the company’s debts to Edelweiss Asset Reconstruction Company (EARC) was discussed by the consortium. However, Canara Bank dissented on the grounds that no fresh valuation of hypothecated/mortgaged assets was done to justify the offer of ₹2,354 crore, when the total depreciated value of the plant and equipment of GTL as on March 31, 2018, was about ₹7,944.50 crore.
Going by the company’s audited balance sheet, it had 27,729 telecom towers with useful life of 35 years and value of about ₹10,330 crore as per a similar deal between ATC Telecom Infrastructure and Vodafone India Limited. As alleged, despite the objections of some members, 79.3% of the outstanding dues amounting to ₹3,224 crore were assigned to EARC by 13 banks for a consideration of about ₹1,867 crore, causing huge wrongful losses to the lenders.
At the time of assignment of debt to EARC, as on March 31, 2018, the banks were holding 64.97% equity of GTL comprising of 1212.17 crore shares. The promoters were holding 19.52% equity. However, the banks in question did not opt for sale of their equity in block deal or action under the SARFAESI Act to secure their loan from the collateral securities, including the company’s plant and machinery, and instead, “with mala fide intention” adopted the asset reconstruction route, alleged the FIR.
