CBI registers case against Ahmedabad based private company and others for allegedly causing loss to Central Bank of India

New Delhi, August 26, 2014: The Central Bureau of Investigation has registered a case U/s 120-B r/w 420 of IPC and Section 13(2) r/w 13(1)(d) of P.C. Act, 1988 against Ahmedabad based private company (represented by its Director) and other unknown persons on the basis of a complaint received from Central Bank of India alleging that the said firm & its Directors and other unknown public servants of Central Bank of India entered into a criminal conspiracy and cheated Central Bank of India to the tune of Rs.436.74 crores(approx.).

It is further alleged in the complaint that the company requested for credit to enable them to supply steel and iron to one other firm in Tanzania.  One of the Directors of the said Ahmedabad based company was also the Director of the latter company. The said company of Ahmedabad did not submit any proof of delivery of the material & defaulted on the loans taken.  Also, standby Letters of Credit opened by the bank to facilitate trade in machinery and coal devolved. The bank had to make payment when the company failed to pay the counterparty. The private company had allegedly made false representations to induce the bank to extend credit facilities to them.

Searches were conducted today at 9 places in Ahmedabad, Gandhinagar, Vadodara and Kutch (Gujarat).

Further investigation is continuing.

(SK Vyas/Jalandhar)