The Central Bureau of Investigation (CBI) Tuesday booked Deccan Chronicle Holdings Ltd (DCHL) chairman T. Venkatrami Reddy and two others for cheating and criminal conspiracy.
The investigating agency registered the case under Sections 120-B read with Section 420, 468 and 471 of the Indian Penal Code with the "fraud" perpetrated at Canara Bank's prime corporate branch, Secunderabad.
The CBI, in a release, said the case was also booked against DCHL vice-chairman, managing director and its auditors.
The agency took the action on a complaint by the Bangalore-based bank, which allegedly suffered a loss of Rs.357.77 crore due to the fraud. The CBI officers had Monday conducted searches at the DCHL office and the residential premises of the accused.
"It is alleged in the FIR that during the period 2009-2011, the accused persons entered into a criminal conspiracy to cheat Canara Bank, Secunderabad Branch.
In furtherance of the conspiracy, the accused had availed open cash credit limit with periodical enhancements and multiple short term corporate loans aggregating Rs.1,230 crore (approx) from Canara Bank, thereby availing excessive bank finance without adequate drawing power by allegedly submitting false and fabricated financial statements and by suppressing the borrowings taken from other banks," the release said.
"It is also alleged that the accused utilized the short term corporate loans for purposes other than for which it were sanctioned by fraudulently diverting the proceeds of various credit facilities. They did not repay the credit limits and also the investments aggregating Rs.20 crore made by the bank in non-convertible debentures of the company."
"It is further alleged that the company had submitted false and fabricated balance sheets concealing its actual borrowings from Canara Bank and other banks and had also alienated the security hypothecated/mortgaged to Canara Bank. The total loss allegedly caused to Canara Bank is to the extent of Rs.357.77 crore (approx) as on Sep 8, 2012," the agency added.