Arrested by CBI over Rs 280 crore SBI loan fraud, Rohan Developers’ Harresh Mehta files bail application

The bail application copy is with The Indian Express.

Mehta applied for bail on grounds that he is a law-abiding citizen with roots in society, and saying there is no possibility of him absconding. In his bail application, Mehta also called his arrest illegal, uncalled for, and without any legal and factual justification.

He claimed his company Mindset Estates Pvt Ltd is simply holding development rights for Ruby Mills and has constructed the building in its capacity as its real estate developer. He has no connection whatsoever in any transaction between Rajput Retails Ltd and SBI. Accordingly, SBI has not named him in the FIR. He also pointed out that CBI, after carrying out a detailed investigation from 2016 to 2018, has not found his role in the purported scam.

Mehta has also mentioned in his bail application he has been named as a witness in the charge sheet. In view of this, it is completely illegal on the part of CBI to arrest him based on information which was not available to them at the time of filing of the chargesheet, he added. Moreover, Mehta has claimed that Rs 50 crore by Ruby Mills Ltd is a separate Inter Corporate Deposit (ICD) and separate transaction.

The role against Mehta was disclosed for the first time by CBI.

Rohan Developers is one of the leading real estate companies in Mumbai, which has carried out various projects including redevelopment projects in South Mumbai. It is involved in both commercial and residential development.

What is the case all about?

State Bank of India sanctioned a term loan on three occasions to Rajput Retail Limited (RRL) and other co-accused persons—Bharat Shah of Ruby Mills and Mehta—on the basis of fabricated documents and, thereby, was allegedly cheated to the tune of Rs 280 crore.

CBI told the court while seeking custody of Harresh Mehta that after the completion of its investigation in 2018, it filed a chargesheet against Rajput Retail (now Shreem Corporation Ltd) managing director Vijay R Gupta and director Ajay R Gupta; V N Kadam, the then relationship manager, SBI, Thane; Chartered Accountant Vijay M Patil, and Archana Vishwas Kadam.

It said the investigation was kept open with regard to the role of bank officers and private persons and a supplementary chargesheet will be filed. Therefore, during the course of further investigation, CBI conducted searches at Mehta’s Rohan Developers and Shah’s Ruby Mills.

CBI has said SBI sanctioned a term loan of Rs 139 crore for the purchase of the 14th and 16th floors and a part of the 15th floor in a building, The Ruby, in Dadar and also gave a short-term loan of Rs 16 crore for six months to Rajput Retail in 2011 and the loan proceeds to the tune of Rs 155 crore was received in the account of Ruby Mills on February 10, 2012.

The agency said Ajay Gupta of Rajput Retail, Bharat Shah of Ruby Mills, and Hareesh Mehta of Rohan Developers had executed a letter of intent dated February 20, 2012, for the purchase of the 14th, 15th, and 16th floors of The Ruby. Any letter of intent for the purchase of any building has to be done prior to receipt of funds. Both seller as well as buyer has to execute the sale deed after receipt of full consideration. In the present case, the seller Ruby Mills had received the entire amount of sale consideration of Rs 155 crore on February 10, 2012, but the letter of intent was executed on February 20, 2012.

In its investigation, CBI found that on February 8, 2012, Rohan Developers through its director Mehta had taken his share of the crime proceeds by making a request to Ruby Mills joint director for an ICD loan of Rs 50 crore for a period of six months with an interest rate of 10 per cent. The loan amount is yet to be returned to Ruby Mills and even the interest for an aggregate amount of Rs 155 crore in favour of Rajput Retail for the purpose of purchasing the floors of The Ruby commercial building is pending.

The central agency has claimed Mehta used Rs 50 crore for his associate company in the form of loans and advances causing wrongful loss to the bank in collusion with Bharat Shah and Ajay Gupta and Vijay Gupta.