A Chennai court on February 2, 2024, closed a first investigation report (FIR) against some officials of the State Bank of India (SBI) and a private firm on charges of cheating the bank to the tune of ₹200 crore.
The XI additional city civil and sessions judge S. Isvarane, in his order, noted that the investigation could not establish the allegations levelled against all the accused. “On the basis of statement of witnesses and collected documents, there are no sufficient evidences to launch prosecution against the accused persons for the offences of Criminal Conspiracy, cheating, Criminal misconduct etc. As per the oral and documentary evidences collected during investigation, no criminal misconduct could be established against the public servant regarding the allegation of causing wrongful loss to the Government of India to the tune of Rs.200 Crore and corresponding wrongful gain to themselves. There was nothing incriminating surfaced on the part of accused persons as these loans are secured loans and the value of the property is sufficient to cover the loans,” the order stated.
Original article published in December 2017:The Central Bureau of Investigation (CBI) has registered a case against some officials of the State Bank of India (SBI) and a private firm on charges of cheating the bank to the tune of ₹200 crore.
Acting on specific information, the CBI’s Anti-Corruption Branch here booked N. Parthiban, Case Officer, S. Muralikumar, Case Lead Officer, Stressed Asset Management Branch, SBI, a few officials of the Overseas Branch, Chennai, and Quintegra Solutions Limited (QSL), Chennai, represented by V. Shankara Raman, Chairman & Managing Director, Melevettil Padmanabhan, Non-Executive Chairman, V. Sriraman, Whole Time Director, S. Kamakshi Shankara Raman, and G. Venkatarajulu and R. Kalyanaraman, both independent directors, on charges of cheating the bank by entering into a criminal conspiracy.
The CBI’s case is that the bank had sanctioned an initial loan of ₹7.87 crore which was incrementally enhanced over a period to some ₹114 crore.
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The bank officials subsequently facilitated a one-time settlement to a meagre amount of ₹14.5 crore with a condition to write off the assets mortgaged against the outstanding total dues of ₹214 crore by December 2013.
Initially, the loan account of QSL, a public limited company, was taken over by the SBI, Overseas branch, Chennai, from Andhra Bank on June 14, 2004, with a loan credit of ₹7.87 crore.
Over a period of time, the loan amount was enhanced with a subsequent sanction of ₹60 crore to enable the company acquire Pingho Associates Corporations (PAC), U.S. The loans were sanctioned with hardly any collateral security.
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Later, the account was classified as a non performing asset (NPA) and transferred to the Stressed Asset Management branch, Chennai, on April 30, 2010.
Principal waived
Despite huge and staggering outstanding dues, the Stressed Asset Management Branch officials proposed a one-time settlement of ₹14.5 crore, which was a meagre amount, by waiving off the principal component of ₹90.92 crore.
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The CBI said the huge waiver of the principal portion of a term loan running close to ₹90.92 crore was very unusual and a deviation from the laid down rules of the bank and the Reserve Bank of India.
The suspects also overlooked the recommendations of the internal audit report that recommended registration of a criminal case against QSL.
The officials of SBI and QSL caused a wrongful loss of more than ₹200 crore to the bank and corresponding gain to the company. The suspects were booked under Section 120 (B) (criminal conspiracy), 420 (Cheating) of IPC and provisions of the Prevention of Corruption Act, 1988.
This article was originally published on December 20, 2017. It was updated on February 16, 2024 after a Chennai court accepted the investigating officers’ closure report.