The CBI has booked Delhi-based Shakti Bhog Foods Limited and others for allegedly cheating a consortium of 10 banks to the tune of ₹3,269.42 crore.
Among those named in the FIR are the company’s managing director, Kewal Krishan Kumar, and directors Siddharth Kumar and Sunanda Kumar.
The 24-year-old company is into manufacture and sale of food items like wheat flour (under the well-known brand name Shakti Bhog), rice, biscuits and cookies in northern India. In other regions, it has third party tie-ups.
Forensic auditors’ report
According to the FIR, the fraud came to light when forensic auditors submitted their final report in June 2019 on the transactions from April 2013 to March 2017. The account with an outstanding of ₹2,016 crore had turned non-performing asset in March 2015, it said.
The forensic report disclosed alleged manipulation of the account statements and stock status. In the audited financial statement for 2015-16, the account mentioned that inventory costing ₹3,035.52 crore was damaged due to pest and, therefore, had to be sold at substantially low rates.
However, it is alleged that in the stock and receivable audit conducted for January-February 2016, it was noted that the stock in September 2015 was worth ₹3,537.55 crore. The stock auditor stated that the company’s warehouses were fully stocked and none of the inventory was identified as slow moving or obsolete.
The stock auditor also pointed that the company had taken an insurance policy to cover the risk of fire, earthquake and special perils to the extent of ₹3,335.10 crore.
As it turned out, two of the five vendors shown to have been paid money by the company did not exist. The vehicle numbers mentioned on transport challans were not found to of goods carriers, but of two wheelers and other classes of vehicles, raising suspicion of sham transactions, the FIR alleged.