New Delhi: CBI has arrested the Chairman and
two directors of a listed company in Ahmedabad for allegedly
defrauding Andhra Bank of around 21 crore by submitting fake
and forged documents.
The three -- Chairman and Managing Director Subash C
Mehta and his two sons and Directors of the company Pradeep
and Deepak -- were arrested by the agency.
CBI conducted searches at the premises of the accused
persons and the company -- Vishal Export Overseas Limited --
which resulted in recovery of various documents that were
being scrutinized for further investigation, CBI spokesperson
said in a release here.
The arrested were produced before the Additional Chief
Judicial Magistrate, Ahmedabad yesterday, which sent Subhash
to judicial custody till April 12 and his sons to two days of
The Bank Securities and Fraud Cell of CBI, Mumbai had
registered a case against the three on the complaint of Andhra
The company, listed in Ahmedabad exchange, is engaged in
the export of agricultural commodities and also claimed to
possess the status of Star Export House. The company had
availed funds like Packing Credit Facility, Foreign Bill
Discounting facility, Letter of Credit facility from a
consortium of about 23 banks to the tune of around Rs 500
crores between 2004 and 2006, it said.
The company allegedly cheated other banks of its funds
by adopting fraudulent means like furnishing bogus and forged
documents to the bank, by getting Letters of Credit opened in
favour of its own associate companies without underlying
genuine business transactions, CBI claimed.
Besides, the company also diverted the funds sanctioned
by banks for its own purpose and failed to utilise for the
purpose for which they were sanctioned.
CBI had earlier registered three cases against this
company and its Directors on the complaint filed by Punjab
National Bank, Vijaya Bank and UCO Bank alleging cheating of
its funds by the company to the tune of around Rs 190 crores.
The allegations were that the company claimed to have
exported diamonds to its associate companies in foreign
countries after availing funds from the bank for other
They also allegedly furnished the same set of documents
for availing different facilities from different banks and
thereby, cheated the financial institutions.