The Central Bureau of Investigation (CBI) has registered an offence against officials of the Central Bank of India, Pune, and Sinhgad Technical Education Society (STES), Pune, for allegedly entering into a criminal conspiracy and causing a loss of approximately Rs 58.04 crore by misappropriating money received as loan from the bank.
The CBI has alleged that STES took a loan from the bank for various construction works, including the construction of the Dental College and Hospital Building at Narhe, Pune, but no such college was constructed. The STES had allegedly furnished fake documents showing expenditure of crores of rupees towards construction of the college.
The CBI has identified the accused as M N Navale, president and chief managing trustee of STES, A G Sawant, the then assistant general manager (AGM) and Vidyadhar Pednekar, then senior manager at the Mid-Corporate Branch, Central Bank of India, Pune, STES, Pune and other unknown persons. The CBI has booked the accused under sections 120 b, 420 of the Indian Penal Code and sections 13 (1), 13 (1) (d) of P C Act, 1988.
CBI officials also conducted searches at the residence of bank officers at Mumbai and Nashik, and the office and residential premises of Navale and STES in Pune. As per an FIR registered by the CBI, it is alleged that AGM A G Sawant and senior manager Vidyadhar Pednekar of Central Bank of India entered into a criminal conspiracy with Navale during the period 2011-12.
Navale applied for various financial facilities to the AGM, Central Bank of India, Mid-Corporate Branch, M G Road, Pune, to the tune of Rs 81.30 crore, including a fresh term loan of Rs 60 crore and taking over of existing term loans from the Punjab and Sind Bank and Canara Bank.
In the Project Report submitted with the application, Navale gave false information that the loan amount would be required for various construction works and supply of materials at different campuses of the STES, including the construction of Dental College & Hospital Building at Narhe, Pune.
It was alleged that AGM Sawant recommended the loan proposal of Navale without following due procedure.
According to the CBI, acting on the basis of a recommendation by Sawant, the Management Committee of the Board of Central Bank of India had sanctioned a loan amount of Rs 75.01 crore, which included Rs 60 crore as fresh term loan, Rs 13.01 crore as takeover of loan from Canara Bank and Rs 2 crore as takeover of loan from Punjab & Sind Bank.
“It was also alleged that the disbursement of the sanctioned facilities was made by then AGM to the borrower without following the procedure and without ensuring its end use. The borrower didn’t utilise the loan amount for the purpose for which it was sanctioned and diverted the same for the purpose other than the one for which it was sanctioned. It was also alleged that in respect of the utilisation of the disbursed amount, the STES furnished bogus documents to the bank, including a certificate of an architect, falsely showing expenditures of Rs 21.20 crore (approx) incurred towards construction of Dental College & Hospital Building at its Narhe campus, whereas no such Dental College & Hospital was constructed there. The bank officers have favoured the borrower by way of misrepresenting the facts that all the construction works, for which the financial facilities were given by the bank, had been completed by the said society. The bank officers also did not ensure that the securities were in place to guard the financial facilities provided by the Bank,” stated a press release by the CBI on Friday.
The CBI had alleged that M N Navale was a wilful defaulter and “in pursuance of the aforesaid criminal conspiracy”, he didn’t repay the loan amount to the Central Bank of India, resulting in the account becoming NPA. “An alleged loss to the extent of Rs 58.04 crore, plus interest thereon, was caused to the bank,” said the agency. CBI sources said that raids had also been conducted at Navale’s office and residence at Sinhgad Road, Hadapsar and Pune – Mumbai Road.