CBI books Manoj Jayaswal in Rs 4,000 crore loan fraud in Nagpur

NAGPUR: The Central Bureau of Investigation (CBI) has registered yet another offence against Manoj Jayaswal. Corporate Power Limited (CPL), the company promoted by him, has been charged with bank loan fraud of Rs4,000 crore. The amount was lent by a consortium of 20 banks, led by Union Bank of India. Twelve other persons have been booked along with Jayaswal.
The loan was declared NPA by the lead bank in 2013 with other banks following suit. The account was declared as fraud in October 2019. The offence has been registered based on a complaint filed by Union Bank of India. CPL is a company registered at Kolkata, however, Jayaswal’s businesses were run from Nagpur.
The FIR stated that the filing of complaint was delayed due to Covid pandemic. After Union Bank of India, which is the lead financier, declared the account as fraud in October 2019, it was decided that the banks would file a CBI complaint on behalf of the consortium of lenders. Later, mandates from all other banks were called. Due to Covid lockdown there was delay in getting information and filing a CBI complaint, the FIR states.
Jayaswal and others have been accused of submitting manipulated bank statements for availing the loans and diverting the funds to a web of companies through dummy accounts. The company’s name had surfaced in the coal block allocation scam during the UPA regime. The group was among the entities which had bagged the highest number of coal blocks through the allotment system, which was later scrapped.
CBI had conducted searches in Nagpur, Kolkata, Ranchi, Durgapur, Visakhapatnam, and Ghaziabad. Jayaswal is learnt to have shifted his base to Visakhapatnam these days. The company had plans to set up a 540MW power plant. According to the FIR, the fraud was declared after a forensic audit of the firm’s accounts.
An internal investigation into the account pointed out that the borrowers had manipulated project costs and diverted the banks’ funds. For example, as against the standard cost of Rs 5.09 crore for setting up a greenfield project of over 500MW, the actual cost incurred was shown at Rs 9.35 crore. The amounts were diverted to related parties who were shown as creditors of the company.
Finally, the case was referred to the National Company Law Tribunal (NCLT) and the corporate insolvency resolution process is still going on. The resolution plan was offered to Vedanta Group, however, it was decided to go for liquidation as the amount offered for was not sufficient the liquidation value. All the actions under SARFAESI Act have been completed. However, orders are still awaited, and the matter is not listed. A joint suit has been filed in the debt recovery tribunal and pleading has been completed.