Diamond Power promoters, accused of Rs. 2,654cr-fraud, held in Rajasthan
In a joint operation, the CBI and the Gujarat Anti-Terrorist Squad (ATS) have arrested three promoters of Vadodara-based Diamond Power Infrastructure Ltd (DPIL), accused of defrauding a consortium of banks to the tune of Rs. 2,654cr, officials said today. The three promoters, SN Bhatnagar and his sons Amit and Sumit, were held at a hotel in Udaipur last night. DPIL manufactures electrical equipment.
DPIL fraudulently took money from 11 banks
DPIL had fraudulently availed credit facilities from a consortium of 11 banks (both public and private) from 2008, leading to the outstanding debt of Rs. 2,654.40cr as of June 29, 2016. It was declared a non-performing asset in 2016-17. The company allegedly submitted false stock statements to the lead bank to get more drawing power in the cash credit accounts.
DPIL utilized cash credit limits for obtaining letters of credit
CBI alleged that the DPIL extensively utilized cash credit limits for obtaining a large number of letters of credit, and many of them could not be honored by the company and were thus "forced charged" on the credit limit. Bank of India's exposure to the company is Rs. 670.51cr, Bank of Baroda's exposure is Rs. 348.99cr and that of ICICI Bank is Rs. 279.46cr.