Former Member of Parliament Rayapati Sambasiva Rao, 72, who was also director and founder-promoter of Transstroy India (Ltd), along with company’s managing director Cherukuri Sridhar and director Suryadevara Srinivas Babji, has been charged by the Central Bureau of Investigation (CBI) with criminal conspiracy, cheating, forgery and other multiple counts against Union Bank of India in one of the biggest banking scams in the country.
The CBI registered cases under Sections 120 B (r/w) , 420, 406, 468, 477 (B), Prevention of Corruption Act, 1988- sections 13 (2), r/w 13 (1) (d). Multiple CBI teams began searching the offices and residences of Mr. Sambasiva Rao in Guntur and Hyderabad offices. Mr. Rao was in the house at Guntur when the searches took place.
Based on a complaint by S.K Bhargava, Regional Head, Regional Office, Union Bank of India, Hyderabad, the CBI registered cases against Mr. Rao and two directors of the company.
Charges
Mr. Bhargava accused the company of cheating, criminal breach of trust involving an amount of ₹264.31 plus interest.
In his complaint, he stated that the company was classified as NPA in 2015 and the loan account was classified as sub-standard due to frequent devolvement of Letter of Credits and non-payment of interest on working Capital limits.
The audit report revealed that the company and its directors had diverted funds to the tune of ₹3,822 crore, in a route other than consortium of banks and written off ₹794 crore adjusting the same towards reserves and surplus. The stock statements were manipulated and showed a difference of ₹2,298.28 crore.
Further, the company had routed funds to the tune of ₹2,261.58 crore through non-consortium banks without the knowledge of existing consortium lenders amounting to a serious violation of trust placed in the company which is under legal obligation as well as the guidelines issued by the RBI.
An amount of ₹15.34 crore was transferred to Transstroy Singapore PTE Ltd., subsidiary of company, during 2013-14 from Bank of Baroda without permission of lenders.
Further, ₹36.50 crore was acquired as interest in Hydel Power Project from Sri Jayalakshmi Powercorp Ltd without the consortium of banks.
A six time MP from Guntur, Mr. Rao had been a senior Congress leader during 1985-2014 and was among the MPs who quit Congress protesting the bifurcation of Andhra Pradesh and fought elections in 2014. He was elected from Narsaraopet in 2014 on TDP ticket, but after losing the elections in 2019, kept a low profile.
