Rs 900-cr loan default case: CBI registers case against Mallya

CBI sources said searches were carried out at the offices and residence of Mallya in Mumbai, Goa, Bangalore and other places.

They said a case was registered by the agency against Mallya, the now defunct Kingfisher Airlines, and A Raghunathan, Chief Financial Officer of the Kingfisher, along with unknown officials of IDBI Bank. 

It is alleged that the loan was sanctioned in violation of norms regarding credit limits. No immediate reaction was available from the company.

“The raids are still on at five places of Mallya’s offices and residences in Mumbai, Bengaluru and in Goa in a case of allegedly violating banking norms in sanction and disbursement of Rs 900 crore to Kingfisher Airlines,” a CBI spokesperson said.

The CBI sources said that an FIR into the alleged violations was registered recently as part of its wide probe into criminal aspects of loans declared to be non-performing assets by public sector banks.

The sources said there was no need for the bank to take the exposure outside the consortium. 

Mallya would soon be called for examination in connection with the case.

The IDBI Bank came under the scanner in 2014 for granting an alleged bad loan to Kingfisher Airlines despite knowing its precarious financial position and negative credit ratings.

Mallya would soon be called for examination in connection with the case. The bank will have to explain reasons for extending the loan to the airlines, ignoring its own internal report which has warned against such a move. The debt-laden airlines stopped operations in October 2012.

The CBI sources said the agency has registered a total of 27 inquiries and cases with regards to “bad loans” given by public sector banks to various corporates in 2013.

A CBI spokesperson said in New Delhi that a case of criminal conspiracy under IPC Section 120-B, along with criminal breach of trust provisions of the Prevention of Corruption Act, was filed in the matter.