MUMBAI, June 14: The Economic Offences Wing (EOW) of the crime branch has completed its investigations in the multi-crore cobbler scam, the trial of which is scheduled to start soon.Eighty-six persons, including Saddrudin Daya, former sheriff of Mumbai and owner of Dawood Shoes, Rafique Tejani, owner of Metro Shoes, Kishore Signapurkar, proprietor of Milano Shoes, and Abu Asim Azmi, president of Samajwadi Party's Mumbai unit and partner in Citywalk Shoes, have been charged for allegedly siphoning off government funds to the tune of Rs 1000 crore. Various officials of banks and financial institutions have also been named in the chargesheets.In all, five chargesheets have been filed before the metropolitan magistrate. The first one, filed in July, named Daya and his associates. The second was filed in September, with Signapurkar and his associates as the accused; the third, filed in December, mentioned Tejani and his associates; the fourth one, file in February 1998, mentioned the involvement of theMeredia group and associates; and the fifth and final chargesheet filed on June 9, 1998, mentioned the role played by Abu Asim Azmi and his associates.Officials of the Maharashtra State Finance Corporation, Citibank, Bank of Oman, Dena Bank, Development Credit Bank, Saraswat Co-operative Bank, and Bank of Bahrain and Kuwait were also chargesheeted.The scam broke out in 1995, exposing the racket which had led to the siphoning of huge government funds. The modus operandi of the accused was to float a cooperative society of cobblers to avail of soft government loans through various schemes. One of the schemes was the refinance scheme of Khadi and Village Industries Commission (KVIC), which enabled a cobbler to avail a loan of Rs 25,000 per annum for three years at a low rate of interest, provided he was member of a cooperative society. The loans were issued by commercial banks refinanced by the Small Industries Development Bank of India. The products, manufactured by cobblers who availed of bank loans,were granted sales tax exemption on turnover up to Rs. 50 lakh. The KVIC was authorised to scrutinise loan applications of cobblers and recommend sanctioning of loans.Several bogus societies of cobblers were formed only for the purpose of availing loans. Investigations revealed that most shoe retailers and some construction companies like the Meredia group provided guarantees to individual cobblers for raising loans. Police alleged that most of the retail outlets in the city were instrumental in forming bogus societies of cobblers to avail loans. The scam came to light when Rauf Memon, an employee of Dawood shoes, lodged a complaint with the crime branch in 1995, alleging he was threatened by gangster Ejaz Pathan on behalf of Daya. During interrogation by the police, Memon revealed all he knew about the scam. Finally, the case was handed over to the EOW.
