NEW DELHI -- CBI has registered a case against electrical equipment manufacturer Best and Crompton Engineering Projects Limited for allegedly cheating Andhra Bank to the tune of ₹71 crore.
In its FIR against the Chennai-based company and its five directors including Managing Director Kakulamarri Srinivas Kalyan Rao, CBI has slapped charges under IPC sections pertaining to criminal conspiracy, cheating and forgery among others.
The FIR has been registered on the basis of a complaint from Andhra Bank which had extended working capital, bank guarantee and letters of credit worth ₹60 crore to the company.
Later, Central Bank of India which was the leader of the consortium funding the company decided to enhance these limits from ₹310 crore to ₹900 crore, the complaint alleged.
Anticipating increased credit from the consortium of banks comprising Central Bank of India, Corporation Bank and Andhra Bank, the company undertook new projects but could not complete them on time, it claimed.
The CBI has slapped charges under IPC sections pertaining to criminal conspiracy, cheating and forgery among others.
During investigations, banks found that the company indulged in fictitious sales which were merely book entries, was maintaining 24 accounts with all the banks and indulging in high value transactions on which consortium had no control, and indulged in diversion of funds, it alleged.
"A fraud involving an amount of ₹71.46 crore came to light at our T Nagar branch, Chennai, perpetrated in the account of M/s Best and Crompton Engineering Projects Limited by its Promoters/Directors and some others in the Working Capital (OCC), Bank Guarantee (BG) and ILC (LC) facilities sanctioned by the bank," the complaint, now part of the FIR, alleged.
The complaint from Zonal Manager of Andhra Bank W Ganapathi Rao alleged that the company and its Directors Meka Ramakrishna Varma, Ravinarayanasamy Balachandran, Kakulamarri Srinivas Kalyan Rao, Ippagunta Shesagiri Rao with an intention to defraud the bank availed OCC, LG and BG limits for working capital requirement.
It alleged that they committed the offences of cheating, criminal misappropriation by diversion of funds by showing fictitious purchases and sales by showing mere book entries, by opening LCs as friendly entities and transferring and misusing funds from the banking system fraudulently when the LCs devolved and defrauded the bank to the tune of ₹71.46 crore.
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