VIJAYAWADA: The Central Bureau of Investigation (CBI) on Thursday conducted searches on the premises of YSRC rebel MP K Raghurama Krishna Raju and other directors of M/s Ind-Barath Thermal Power Limited in a case related to a Rs 826-crore fraud involving a consortium of banks led by the Punjab National Bank (PNB).
The CBI, in an official note, said that the case was registered based on a complaint from Punjab National Bank against M/s Ind-Barath Thermal Power Ltd (based in Secunderabad) and others alleging the accused cheated the PNB-led consortium by diversion/siphoning off bank funds.
Searches were conducted at 11 locations in Hyderabad, Mumbai and Narasapur in West Godavari district of Andhra Pradesh, at the office and residential premises of the firm and the other accused, the CBI said.
The FIR was registered on October 6 following a complaint by Saurabh Malhotra, chief manager, PNB Large Corporate Branch in New Delhi, alleging criminal conspiracy, cheating and criminal misconduct by the firm and its directors to cheat the bank to the tune of Rs 826.17 crore. The complaint was made in March.
According to the FIR, Ind-Barath initially proposed to set up a 300 MW coal-based group captive power plant at Honkan village in Uttara Kannada district of Karnataka. However, due to environmental clearance issues, it was shifted to Tuticorin district in Tamil Nadu. The consortium of banks sanctioned a loan of Rs 941.80 crore and sub-ordinate loan of Rs 62.80 crore to partly finance the project in 2008.
After completing the project, it asked the consortium to allow Working Capital facilities in order to run its plant efficiently and to secure the working capital limit of Rs 300 crore. The documents were executed in 2014.The FIR said there were persistent irregularities in the company’s accounts that were brought to the notice of the company through letters as well as orally. “Despite regular follow ups with the company and its directors, there was no positive response from the company, which resulted in irregularities in the accounts. Due to this, the accounts of the company were declared Non-Performing Assets by the lenders as per the guidelines of the RBI,” the FIR said.
The CBI said the company, instead of repaying the debt, paid Rs 267 crore to other parties between April 1, 2014 and August 31, 2018 through bank accounts. In addition, Rs 41 crore recoverable from other non-related parties was transferred to others through book entries.
Further, the CBI said impairment of coal was deliberated with the lenders since 2017 in various meeting and stock audits. “The company impaired the value of stocks up to 95 per cent in account books as on March 2018. However, during the discussion of the forensic audit, it transpired that the company destroyed the coal physically and was not able to produce evidence,” the CBI said.
Based on this, the CBI said the company indulged in diversion and siphoning of funds to the detriment of the bank with a view to commit criminal misappropriation or fraud against the bank. Further, the FIR said the transactions were found to be done at the behest of and with the knowledge of the directors, causing wrongful loss to the lenders. “It was apparent that the intent of the directors of the company right from the inception was to deceit the lenders,” the FIR said. The CBI registered cases under Sections 120-B (criminal conspiracy) and 420 (cheating) of the IPC and Section 13(2) read with 13(1)(d) of the Prevention of Corruption Act, 1988.
Apart from M/s Ind-Barath Thermal Power Limited, the CBI named MP Raghurama Krishna Raju, his wife Kanumuru Rama Devi and other directors of the company, and unknown public servants and private persons.Incidentally, the CBI raids came close on the heels of PNB CEO and MD Mallikarjuna Rao meeting Chief Minister YS Jagan Mohan Reddy during the latter’s recent visit to Delhi.