CBI searches Bhushan Power and Steel premises in Rs 2,348 cr bank fraud case
New Delhi: The CBI on Saturday conducted country-wide searches at official and residential premises of debt-ridden Bhushan Power and Steel Limited (BPSL) in connection with a bank fraud case that cost banks and the government a whopping Rs 2,348 crore, sources here said.
The federal agency registered a case on Friday against the company, naming its Chairman and Managing Director Sanjay Singal along with promoters and associates of the company.
An official source here added that the case is registered under Bank Security and Fraud by the Economic Offences Division of CBI.
Speaking to the Millennium Post, agency sleuths said that searches were conducted in Delhi, Chandigarh, Kolkata, and Odisha, which resulted in the seizure of various documents pertaining to the case.
The CBI alleged that top-level officials of BPSL hatched a criminal conspiracy with unknown public officials to divert funds from loan accounts in a Chandigarh branch of Punjab National Bank and Kolkata branches of Oriental Bank of Commerce, IDBI Bank, and UCO Bank through several shell companies "without any obvious purpose".
The CBI has charged the accused in the case with using forged documents and falsifying accounts, thereby causing a loss of more than Rs 2,300 crore to the concerned banks, financial institutions, and government exchequers.
Furthermore, sources added that the company also claimed inadmissible CENVAT credit for themselves.
In addition to what has been alleged by CBI, the Delhi-based steel manufacturer has defaulted on loans of up to Rs 47, 204 crore, borrowed from 33 banks and financial institutions between 2007 and 2014.
In order to recover the defaulting loans, the PNB-led consortium of lenders had initially chosen to go to the National Company Law Tribunal (NCLT), after PNB had declared BPSL accounts as a Non-Performing Asset.
The CBI searches come in the backdrop of BPSL's apparent insolvency troubles as a Delhi bench of NCLT is trying to facilitate a buyout, for which both Tata Steel and JSW-Steel have made their bids, with the Sajjan Jindal-led company leading at the last count.
The Delhi bench was suppose to make a decision on the Rs 19,650 crore offer from JSW by March 31.