The CBI on Saturday filed a case against ABG Shipyard and its Directors Rishi Agarwal, Santhanam Muthuswamy, and Ashwini Kumar for allegedly cheating 28 banks of a whopping Rs 22,842 crore.
The shipyards of the company are located in Dahej and Surat in Gujarat.
According to a complaint by the State Bank of India, the company owes Rs 2,925 crore to the bank, Rs 7,089 crore to ICICI Bank, Rs 3,634 crore to IDBI Bank, Rs 1,614 crore to Bank of Baroda, Rs 1,244 to PNB and Rs 1,228 crore to IOB. Funds were used for purposes other than for which they were released by banks, the CBI said.
The bank had first filed a complaint on November 8, 2019, on which the CBI had sought some clarifications on March 12, 2020.
The bank filed a fresh complaint in August that year. After scrutinising the documents for over one and a half years, the CBI acted on the complaint filing an FIR on February 7, 2022.
The central investigation agency stated that the fraud took place between 2012 and 2017 through the diversion of funds, misappropriation, and criminal breach of trust with an objective to gain unlawfully at the cost of the banks.
"The Forensic Audit report dated 18.01.2019 submitted by M/s. Ernst & Young LP for the period April 2012 to July 2017 revealed that the accused have colluded together and committed illegal activities including diversion of funds, misappropriation, and criminal breach of trust and for purposes other than for the purpose for which the funds are released by the Bank", the CBI alleged in its FIR.
"The global crisis has impacted the shipping industry…. The cancellation of contracts for a few ships resulted in the piling up of inventory. This has resulted in a paucity of working capital and caused a significant increase in the operating cycle, thereby aggravating the financial problem. There was no demand for commercial vessels as the industry was going through a downturn even in 2015. Further, there were no fresh defence orders released in 2015. Thus, the company was unable to service the interest and instalments on the due date," the CBI has also stated in the FIR.
