Insider
Attack
This Company, however, did not comply with the said order as it was already bankrupt and has preferred to go one step further and is now under liquidation.
Meanwhile, the Cosmos Bank had filed for modification of charges charge for Rs.97,30,89,000/- on 30/09/2014 that was originally created on 27/11/2009. This was because the bank re-phased an overdue loan of Rs.7.75 crore (A/c No. 01775180657) and Rs.2.64 crore (A/c. No. 01780180675). The overall facility as on 30/09/2014 was as follows:
Whereas three alert persons filed winding up petition against the Company for its default in payment of Rs.1.75 crore to them and ultimately got the winding up of the company in process, it is really shocking to note that the Bank reschedules the already dead account by technical manipulation of re-phasing the term loan so as to delay the eventual classification of this account as NPA and takes the hit of Rs.97.31 crore. I am sure even you would agree that I would not be wrong if I were to infer that Jains, the Petitioners, were more diligent and alert to protect their financial interest of Rs.1.75 crore than the collective diligence and alertness of the Board of Cosmos Bank for Rs.91.30 crore. Or was it a case of collusive or collaborative non-diligence or negligence? This case also needs a detailed investigation by appropriate law enforcement agencies.
Euro
DECOR PRIVATE Limited:
Term loans and cash
credit totaling to Rs. 82.63 crore to through Vile Parle East Branch, Mumbai
turning into NPA displaying complete connivance and camaraderie between both
sides.
The
borrower company Euro Decor Private Limited
was sanctioned term loan and cash credit facilities as follows:
Sr. No.
|
Type of Facility
|
Account Number
|
Amount of Loan
|
Date of sanction
|
1
|
Cash Credit
|
01760013629
|
55,00,00,000
|
24/09/2012
|
2
|
Term Loan
|
01775180657
|
18,63,00,000
|
24/09/2012
|
3
|
Term Loan
|
01775121591
|
5,00,00,000
|
24/09/2012
|
4
|
Term Loan
|
01780180675
|
4,00,00,000
|
24/09/2012
|
5
|
Letter of
Credit
|
|
18,50,00,000
|
24/09/2012
|
6
|
Bank
Guarantee
|
|
17,35,000
|
24/09/2012
|
7
|
Cheque
Purchase
|
|
15,00,000
|
24/09/2012
|
This
company has also given Bank Guarantee of Rs.16.20 crore for its other Group
Company, viz., Euro Merchandise (India) Limited, that is NPA. A company, whose net worth as on 31/03/3013
was not more than Rs.16.70 crore is giving the corporate guarantee of Rs.16.20
crore and the bank accepting such corporate guarantee remaining oblivious of
facts that are too visible to miss is a pointer to the goings on in the Cosmos
Bank. As on 31/03/2013, this Company had also given Bank Guarantees along
with other guarantors totaling to Rs.349,02,77,092/- for facilities extended to
its other group company Euro Ceramics Limited, which is also NPA.
All these loans became officially
NPA on 30/09/2014 and joined the ever expanding list of “quick
mortality’ borrowers of Cosmos Co-operative Bank Limited. However, the Company
was given a lease of life till next year by technical re-phasing of overdue
loans before they eventually became NPA and possibly a total write off.
Three
Company Petitions bearing Nos. 645/2013, 646/2013 and 669/2013 were filed in
the Hon’ble Bombay High Court by the creditors for the winding up of Euro Décor
Private Limited. Petition No. 645/2013 was filed by Vijay Jain for nonpayment
of Rs.65 lac by the Company. Petition No. 646/2013 was filed by Ajay Jain for nonpayment
of Rs.60 lac and Petition 669/2013 was filed by Sadilal & Sons for
nonpayment of Rs.50 lac by the Company. The Hon’ble Bombay High ordered the
Company to pay the Petitioner Creditors within a certain period and on terms
and conditioned laid down in the said order and further passed order on
17/10/2014 as follows:
“(v)
In the event of the Company committing any default (including grace period of
15 days) in payment of the agreed installments and interest hereinabove, the
Company Petition shall stand revived without reference to this Court and the
same shall stand allowed in terms of prayer clauses (a) and (b), which are
reproduced hereunder:
(a)That
the Company M/s. Euro Décor Pvt Ltd. be wound up by this Hon’ble Court under
the provisions of the Companies Act, 1956;
(b)
that the Official Liquidator be appointed as the liquidator of the Company with
all the powers under the Companies Act, to take charge of the assets of the
Company and to conduct its affairs in the course of winding up and to distribute
its assets in accordance with the law;…”
This Company, however, did not comply with the said order as it was already bankrupt and has preferred to go one step further and is now under liquidation.
Meanwhile, the Cosmos Bank had filed for modification of charges charge for Rs.97,30,89,000/- on 30/09/2014 that was originally created on 27/11/2009. This was because the bank re-phased an overdue loan of Rs.7.75 crore (A/c No. 01775180657) and Rs.2.64 crore (A/c. No. 01780180675). The overall facility as on 30/09/2014 was as follows:
- Cash credit: Rs.55,00,00,000/- crore (existing)
- Term loan: Rs.18,63,54,000/- is rephrased for balance outstanding Rs.7,73,00,000/-
- Letter of Credit: Rs.18,50,00,000/- (Existing)
- WCTL: Rs.5,00,00,000/- (existing)
- Bank Guarantee: Rs.17,35,000/-
- Cheque purchase: Rs.15,00,000/-
- Out of L/C limit of Rs.18.50 crore, Rs.5.00 crore was interchangeable with cash Credit limit.
Major
companies of this EURO group giving cross-corporate guarantees, The Board of
Cosmos Bank accepting such dud corporate
guarantees and these group companies simultaneously becoming NPAs speak
volumes about the ongoing in the affairs of the bank.
Whereas three alert persons filed winding up petition against the Company for its default in payment of Rs.1.75 crore to them and ultimately got the winding up of the company in process, it is really shocking to note that the Bank reschedules the already dead account by technical manipulation of re-phasing the term loan so as to delay the eventual classification of this account as NPA and takes the hit of Rs.97.31 crore. I am sure even you would agree that I would not be wrong if I were to infer that Jains, the Petitioners, were more diligent and alert to protect their financial interest of Rs.1.75 crore than the collective diligence and alertness of the Board of Cosmos Bank for Rs.91.30 crore. Or was it a case of collusive or collaborative non-diligence or negligence? This case also needs a detailed investigation by appropriate law enforcement agencies.
The
next review of this dead account was due on 24/09/2015.
The
moot question is what did the bank consider when they reviewed Company’s
position as on 30/09/2014 when the borrower company was already fighting
winding up petitions filed against it by the creditors? And this happens when
the then MD Vikrant Ponkshe was employed for his expertise in Risk Analysis and
Strategy, when majority of the Directors have LLB qualifications printed on
their forehead, when two Directors are practicing CAs and when Self-anointed Chairman
Emeritus Dr Mukund Abhyankar is PhD and LLB!!
The
Directors of the Bank have a fiduciary relation with the shareholders of the
Bank. The Directors are supposed to work within the framework of law and well
established prudent banking norms. Any deviation from these norms by the
Directors would constitute fraud and criminal breach of trust of the
shareholders of the bank. The Directors are liable to make good the loss
suffered by the Bank due to mala fide
and fraudulent acts from the personal assets of such delinquent directors and
employees.
About
Rs.97.31 crore odd plus unspecified
interest are locked as NPA in this one account where deviation from prudent
banking practices and absolute lack of due diligence is prima facie visible, giving rise to criminality. I am concerned how
many skeletons are going to tumble out of the closets of the Cosmos Bank.
Factors such as disbursement of huge amounts by violation of prudent banking
norms/practices and without taking adequate collateral security, questionable
guarantors’ gross negligence and total absence of due diligence and quick
mortality do point towards serious acts of omission and commission bordering on
fraud and criminal conspiracy. In my
sincere opinion, this is another fit case for an ‘in-custody’ police
investigation.
Since
MSM has not covered it, the gullible depositors are not aware about it and the
magnitude of Insider Attacks compared to recent Cyber Attack.
So,
the loot will continue.
No comments:
Post a Comment