Punjab CM’s son-in-law among 13 booked for bank fraud case against Simbhaoli Sugars Ltd

The bank had complained to the CBI on November 17, 2017 but the agency registered the case only on February 22 this year.

By: Express News Service | New Delhi | Updated: February 26, 2018 4:20 pm
Punjab CM's son-in-law among 13 booked for bank fraud case against Simbhaoli Sugars Ltd Besides Gurpal Singh, the CBI has booked 12 others in the bank fraud case (In picture:Punjab CM Captain Amarinder Singh)

The Central Bureau of Investigation (CBI) has registered a case against top officials of Simbhaoli Sugars Ltd — one of the largest sugar mills in the country — including its Deputy General Manager Gurpal Singh, who is the son-in-law of Punjab Chief Minister Captain Amarinder Singh, for alleged bank loan fraud of Rs 97.85 crore and default of Rs 110 crore.

According to the FIR filed by the CBI, there are two loans, both from the Oriental Bank of Commerce, under probe — a Rs 97.85 crore loan which was declared fraud in 2015, and a corporate loan of Rs 110 crore used to repay the previous loan. The second loan was declared NPA (non-performing asset) on November 29, 2016, nearly three weeks after demonetisation of Rs 1,000 and Rs 500 notes was announced.

The bank had complained to the CBI on November 17, 2017 but the agency registered the case only on February 22 this year.

Besides Gurpal Singh, the CBI has booked 12 others, including Simbhaoli Sugars’ Chairman Gurmit Singh Mann, CEO G S C Rao, CFO Sanjay Tapriya, Executive Director Gursimran Kaur Mann and other company officials as well as unknown bank officials.

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The agency also carried out searches at eight premises, including the residences of directors, factory, corporate office and registered office of the company in Delhi, Hapur and Noida on Sunday, said CBI spokesperson Abhishek Dayal.

According to the FIR, the Oriental Bank of Commerce sanctioned a loan of Rs.148.60 crore Simbhaoli Sugars in 2011. “The loan was sanctioned for financing individual/ joint liability groups / self help groups / sugarcane farmers, as per a tie-up arrangement under an RBI scheme, to 5,762 sugarcane farmers supplying sugar produce to the said private company during the period from January 25, 2012 to March 13, 2012, which was dishonestly and fraudulently diverted by said company for its own needs,” said Dayal.

As per the MoU, out of the sugarcane price to be paid by Simbhaoli Sugars to the farmers, loan liabilities were to be adjusted and the remaining amount was to be paid by the company to the farmers, said the FIR.

The account was declared NPA on March 31, 2015. On May 13, 2015, the bank declared it as loan fraud of Rs 97.85 crore to the Reserve Bank of India.

While the bank declared a fraud of Rs 97.85 crore, the actual loss incurred was Rs 109.08 crore, according to the FIR. The CBI has invoked sections dealing with criminal conspiracy, cheating and provisions of Prevention of Corruption Act against the accused.

According to the FIR, in addition to the existing NPA, the bank sanctioned another corporate loan of Rs 110 crore to the company on January 28, 2015, to pay its outstanding loan of Rs 97.85 crore, and adjusted the total liability of Rs 112.94 crore towards the company by way of deposit of this new corporate loan.

“The corporate loan, too, turned NPA on November 29, 2016, thus resulting in its first outstanding loan of Rs 97.85 crore (as alleged fraud) and the fresh corporate loan of Rs 109.08 crore (as fresh outstanding),” said Dayal.

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  1. A
    Adil Singh Akoi
    Feb 27, 2018 at 10:17 am
    Before we bring out our pitch forks let’s try to put things in perspective... I work in the sugar industry and the following is exactly what happened to Simbhaoli: the UP govt has been setting the worlds highest sugar cane price... this gets farmers votes... the center has been subduing the price of sugar by regularly allowing cheap imports... this too gets votes. Now a sugar mill does NOT have the option to shut down... sugar is covered under the essential commodities act and therefore the govt has the option of taking over your mill... running it on your behalf and the mill and it’s promoters will be liable for all losses. So the mills run with poor economics and cane arearrs to the farmers build up... the farmer not getting paid is BAD for vote getting.... so govt uses its vast coercive powers to make the mills take loans to pay the farmers and public banks to disburse said loans. Simbhaolis only fault here is it did right by its farmers by taking the loans to pay them.
    1. Paramjeet Singh Samra
      Feb 27, 2018 at 5:48 am
      Mostly business in India Run through Fraud not by hard work . Because mostly govt r corrupt and no law to protect tex payer hard earned money . With so much population poor Indian have no future sir .
      1. R
        Ravindender singh
        Feb 27, 2018 at 5:36 am
        When banks will write to CBI about biggest defaulters to register case against them ? Who have highest NPAs and not Paying back but irony is they are being taken to Davos. Hight of shameful ness.
        1. A
          Feb 26, 2018 at 7:06 pm
          All paid agents responding and always creating difficult environments even in comments by antinational comments in this publication.
          1. A
            Feb 26, 2018 at 7:05 pm
            Never trust IE for anything. Readership must already be down and hope it continues downward spiral for anti India news. Publishing only anti Modi news. Not giving space for anti congress news.
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