CBI digs over 100 agro-products companies of defrauding banks for ₹1,400 crores.
Over the last five years, the Central Bureau of Investigation (CBI) has investigated over 100 agro-products companies on charges of defrauding banks of loans totaling thousands of crores of rupees. So far this year, more than two dozen enterprises ranging from rice crops and spices to oil have been accused of bank fraud totaling over ₹1,400 crores.
S.A. Rawther Spices Private Limited, which exports and imports spices and coffee, was the subject of one of the major complaints filed earlier this year. The company obtained finance from the Jammu and Kashmir Bank.
According to allegations, the company and its employees cost the bank 352.72 crores. It failed to make regular payments on the loan, and the account was deemed a non-performing asset in September 2017.
Among others, Shree Basant Oils Limited has been alleged of bank fraud totaling ₹124 crores, while Saurav (India) Private Limited has been accused of causing a ₹126 crore unlawful loss to its lenders.
Several lawsuits were filed against agro-product trading companies last year as well. One such instance was Shri Jalaram Rice Industries and a ₹114-crore bank fraud.
On December 31, 2021, the CBI charged Shakti Bhog Foods Limited and others with defrauding a consortium of ten banks to the tune of ₹3,269.42 crores. The FIR names the company’s managing director, Kewal Krishan Kumar, as well as directors Siddharth Kumar and Sunanda Kumar.
In the northern states, the company manufactures and sells wheat flour (under the well-known brand name Shakti Bhog), rice, biscuits, and cookies. It has third-party agreements with various entities in the other states.
‘In all of these situations, lending banks have claimed that monies were diverted through various means. Shell corporations are used to transport looted funds, which are frequently rerouted and invested in linked entities. In addition, the accused parties use the proceeds to purchase the property. Companies frequently misrepresent their net worth in order to obtain more credit,’ According to an agency representative.