CBI books Ahmedabad firm, directors for bank fraud

They have been charged with cheating Bank of India of ₹98.88 crore

The Central Bureau of Investigation has booked Ahmedabad-based Chem Edge International Private Limited (CEIPL) and its directors for allegedly cheating the Bank of India (BoI) of ₹98.88 crore.

This is the fourth case registered against the main accused persons in the past few days. In the latest case, among those named are Bharat R. Shah, Fenil B. Shah, Geetaben B. Shah, Ashish Tawalkey and Rajesh Sanghvi, besides unknown public servants.

According to the FIR, the company was sanctioned credit limits to the tune of ₹65 crore by a BoI-led consortium of three banks in 2010. Another consortium of seven banks led by the State Bank of India (SBI) had sanctioned ₹200 crore in 2011. Then, a consortium of seven lenders, headed by the BoI, sanctioned ₹300 crore, wherein the BoI’s share was ₹95 crore.

Turns NPA

The account turned non-performing asset (NPA) in December 2016 due to non-repayment of dues. A forensic audit allegedly flagged banking transactions between related parties and round-tripping of ₹4,131.49 crore.

The company had transferred ₹4,879.93 crore from April 2014 to December 2016 to some companies. They allegedly transferred the funds further to a few entities, which sent ₹4,131.49 crore back to CEIPL. The bank also alleged that the company’s stock records were forged.

The second case was instituted on a complaint from the Central Bank of India against Ardor Global Private Limited, Mr. Bharat R. Shah and Mr. Fenil B. Shah. In this case, in April 2013, a BoI-led consortium sanctioned ₹325-crore credit facilities, in which the complainant’s share was ₹47.50 crore. The account turned NPA in October 2016.

A forensic audit revealed 26 major debtors of the company had an outstanding of ₹928.29 crore. The resolution professional wrote to them. Ten letters returned undelivered as the addresses were incorrect or the office premises had been closed down. Only five companies responded, stating that there was no outstanding with them.

Third case

In the third case, CEIPL, formerly known as Ardor Enterprises Private Limited, was sanctioned credit facilities of ₹200 crore by the SBI-led consortium, wherein the Central Bank of India’s share was ₹40 crore. The account turned NPA in October 2016, as alleged.

Yet another case is against Andor Global Private Limited, Mr. Bharat R Shah, Mr. Fenil B. Shah, Ms. Geetaben B. Shah and unknown public servants, in which the BoI was allegedly cheated of ₹112.79 crore, according to the FIR.