CBI books Hyderabad-based company in Rs 1,700 crore bank fraud case

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NEW DELHI: The CBI has booked Hyderabad-based telecom equipment manufacturer VMC Systems and its promoters in an alleged bank fraud case of Rs 1,700 crore on the complaint of Punjab National BankNSE -6.79 %, which is reeling under the USD 2 billion fraud committed by jewellers Nirav Modi and Mehul Choksi.

 

The Central Bureau of Investigation (CBI) registered an FIR against the company and its promoters--Vuppalapati Hima Bindu, Vuppalapati Venkat Rama Rao and Bhagavatula Venkat Ramanna-- in a case of criminal conspiracy, cheating and forgery, officials said Thursday.

The agency carried out searches at three locations in Hyderabad i.e at the residence and office of the directors, they said.

According to the complaint by the PNB, the company defaulted on repayment of loans worth over Rs 1,700 crore to a consortium of banks.

It has alleged Rs 539 crore as outstanding dues towards itself, while remaining Rs 1,207 crore is pending towards the State Bank of India, Corporation BankNSE 0.00 %, Andhra BankNSE -8.10 % and JM Financial Assets Reconstruction Company.

The company, a manufacturer of equipment for telecom and power sector, had availed working capital credit facilities on August 12, 2009 to the tune of Rs 1,010.50 crore, the bank said. 

It alleged the company diverted the funds given as loan by the consortium of banks.

 

It said the company routed Rs 43.83 crore through current accounts outside the consortium without permission from the consortium between April 1, 2013 to April 30, 2014.

The company had claimed that it could not pay the loan amount because of pending dues from BSNL to which it was a major supplier, but the banks found that the dues of BSNL were only Rs 33.09 crore as against Rs 262 crore claimed by the company.

The company had also shown other receivables from ITI Ltd, Neutrino Power Systems and Vee Pee Systems, aggregating Rs 352.99 crore, but when the SBI took up the matter with them, they denied the same.