CBI books Simbhaoli Sugars for Rs 110-Crore loss to OBC

CBI books Simbhaoli Sugars for Rs 110-Crore loss to OBC

The Central Bureau of Investigation on Sunday filed a case of loan default against Simbhaoli Sugars Limited based in Ghaziabad in Uttar Pradesh for cheating the Oriental Bank of Commerce of Rs 109 crore, The Hindu reported.

Apart from Singh, Simbhaoli Sugar's Chairman and Managing Director Gurmit Singh Mann and 8 others including CFO, executive and non-executive directors of the company and unknown officials of the bank have been named in the FIR.

The stock of Simbhaoli Sugars reacted sharply to this news and at 12:55 hours was trading at Rs. 14.25 per share, down 15.43 per cent, while OBC was trading at Rs. 95.00 per share, down by 10.17 per cent on Monday.

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.

Once again, like Dwarka Das fraud, CBI did not act on OBC's complaint for three months in Simbhaoli's fraud even though the bank approached the central agency asking to register a case on November 17, 2017. As per media reports, CBI spokesperson quoted that searches are being conducted at eight premises including residences of Directors, factory, corporate office and registered office of the company in Delhi, Hapur, and Noida.

More news: Barclays numbs news of 2017 loss with dividend promise

The company submitted to the bank names and details of the farmers involved in the scheme after which the bank's Hapur branch disbursed loans to 5,762 farmers between January and March 2012 worth the total loan amount. As per the FIR, the bank sanctioned a loan Rs 148.60 crore Simbhaoli Sugars in 2011. This loan turned NPA in November 2016.

This is the 2nd FIR in 3 days signed up by CBI+ on the grievance of OBC relating to bank scams.

The OBC was hit by the disclosure of Rs 390-crore scam on Saturday involving a Delhi-based diamond jewellery exporter in bank loan fraud. The business moved diverted the funds from the Escrow account to other accounts preserved by it with SBI, Punjab National Bank and UCO Bank through RTGS.

While the bank declared a fraud of Rs. 97.85 crore, the actual loss had amounted to 109. In addition, the bank also sanctioned another corporate loan of Rs. 110 crore to the company on January 28, 2015 to pay off its outstanding loan of Rs. 97.85 crore.

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