Canara Bank leads the consortium of five banks that provided credit facilities to the company
Canara Bank leads the consortium of five banks that provided credit facilities to the company
The CBI has registered a case against Delhi-based Allied Strips Ltd and 11 others for allegedly defrauding a consortium of banks to the tune of Rs 1,392.86 crore.
The accused include the company’s directors Mohinder Agarwal, Gaurav Agarwal and Sunita Agarwal. The case was registered on a complaint by Canara Bank, which headed the consortium of five banks providing credit facilities to the company.
The company started delaying payment of interest and installments in November 2012. At the request of the company, the lenders restructured the loans in December 2013. However, the account later became a non-performing asset.
A forensic audit of the loan account allegedly revealed irregularities, fraud, fraud and misappropriation of funds, shortfall in stock, diversion of funds and criminal conspiracy.
As it turned out, the company had entered into an agreement with Power 2 SME Pvt Ltd in July 2017 to divert funds by handing over the entire operations of its plant to the latter to clear dues. “It appears that the liability of Rs 37 crore was financial transaction without the knowledge/prior permission of the lending banks,” the First Information Report said.