CBI raids offices, residence of Rotomac Pens owner Vikram Kothari for Rs 800 Cr. loan default
NEW DELHI/ LUCKNOW :A few hours after he denied reports of having fled the country, CBI started searching Rotomac Pens MD Vikram Kothari’s residence and offices in Kanpur from early in the morning, for the alleged Rs 800 crore bank loan fraud.
The banks impacted by his loan default include Allahabad Bank, Bank of India and Union Bank of India. Reports of his absconding act, much like billionaire diamantaire Nirav Modi, ran rife after his Mall Road office in Lucknow was found locked for a week.
There were no arrests in the case yet, CBI spokesperson Abhishek Dayal categorically said. He said Kothari, his wife and his son are being examined by the CBI, which is conducting the searches. CBI has registered an FIR against Kothari.
Following the rumours of fleeing the country, Kothari issued a statement saying, “First of all, it is not a scam. I am not going anywhere. I am an Indian citizen and am very much in my hometown. Though banks have declared my company as a non-performing asset (NPA), I am not a defaulter.
The matter is still sub judice with the National Company Law Tribunal (NCLT). I am regularly in touch with the banks and am constantly cooperating with them. I availed the loans and will repay them soon said Kothari.”
The Kanpur-based company’s owner had taken a loan of more than Rs 800 crore from over five state-owned banks. Allahabad Bank, Bank of India, Bank of Baroda, Indian Overseas Bank and Union Bank of India compromised their rules to sanction loans to Rotomac, sources said. Kothari took a loan of Rs 485 crore from Mumbai-based Union Bank of India and a loan of Rs 352 crore from Kolkata-based Allahabad Bank.
A year later, Kothari has reportedly not paid back either the interest or the loan. Last year, Bank of Baroda (BoB), a consortium partner declared pen manufacturer Rotomac Global Pvt. Ltd. as ‘wilful defaulter’. The company then moved the Allahabad High Co
A division bench comprising Chief Justice D B Bhosle and Justice Yashwant Verma had passed the order on a petition filed by the company, contending that it has been wrongly declared a wilful defaulter by BoB despite having “offered assets worth more than Rs 300 crore to the bank since the date of default”.
Rotomac was declared a wilful defaulter vide an order dated February 27, 2017 passed by an authorised committee, as per the procedure laid down by the Reserve Bank of India.
The CBI on Monday filed a case against Rotomac Pens owner Vikram Kothari and others, soon after there were reports that Kothari had fled India with Rs 800 crore, borrowed from at least five state-owned banks.In the early hours of Monday, the CBI initiated searches on three premises of the accused persons. Mr. Kothari, wife and son are also being questioned in Kanpur.
It has come to light that the investigative agency is carrying out raids at the residence and official premises of Kothari. However, soon after the report emerged, Kothari said he is currently in Kanpur and reports about him “fleeing” are misleading.
Kothari said, “First of all, it is not a scam. I am not going anywhere. I am an Indian citizen and am very much in my hometown. Though banks have declared my company as a non-performing asset (NPA), I am not a defaulter.
The matter is still sub judice with the National Company Law Tribunal (NCLT). I am regularly in touch with the banks and am constantly cooperating with them. I availed the loans and will repay them soon.”
According to report Union Bank of India and Allahabad Bank sources said Kothari has not paid back either the interest or the loaned amount.
The fresh jolt comes days after the revelation of the mega Rs 11,400 crore fraud at a Mumbai branch of Punjab National Bank, which allowed Nirav Modi Group to exploit the system and issued fake Letters of Undertaking (LoUs), helping it raise credit from overseas bank branches.
The CBI on Sunday also wrote to all banks and asked them to report any irregularities in Letters of Undertakings (LoUs), days after the PNB complained about the fraudulent issuance of LoUs and Letter of Credits (LCs) to companies of Nirav Modi and his uncle Mehul Choksi.(With Agency Inputs ).
