Central Bureau of Investigation (CBI) has booked Delhi-based private sector dairy company Kwality Ltd for defrauding a consortium of 10 banks led by Bank of India for more than Rs 1,400 crore. The case is registered following the complaint from Bank of India.
The company’s directors Sanjay Dhingra, Siddhant Gupta, and Arun Srivastava and few others are also charged under cheating, forgery, criminal conspiracy, and corruption.
The investigation agency has conducted raids on the eight different locations in four states Delhi, Saharanpur, Bulandshahr, Ajmer, Palwal. The raid was conducted on the premises of the ice cream maker company’s senior executives and other accused.
It is alleged that the bank has taken the credit in the year 2010 and at the beginning of the year 2018, the dairy maker company started defaulting the payments. Ultimately the account was declared a non-performing asset in August 2018.
“The forensic audit of the accounts showed that out of the total sale of ₹ 13,147.25 crore made by the company, only 7,107.23 crore were routed through the consortium of banks. (Kwality) overstated its financial statements by bloating its business operations and indulged in manipulation of accounts by making reverse entries,” said the complaint filed by Bank of India.
The central investigation agency CBI has stated that Kwalty is accused of cheating the banks by the diversion of bank funds, sham transactions with related parties, fabricated documents or receipts and falsified books of accounts and creating false assets and liabilities.
CBI also stated, “It was alleged in the complaint that the said accused had cheated the Bank of India-led consortium comprising Bank of India, Canara Bank, Bank of Baroda, Andhra Bank, Corporation Bank, IDBI, Central Bank of India, Dhanalaxmi Bank, Syndicate Bank to the tune of Rs.1400.62 core.”
The company has been facing insolvency proceedings since 2018. Kwalty Ltd owes Rs 1,900 crore to creditors. Global equity giant KKR had dragged this oldest ice cream maker to the bankruptcy court. In 2016, the company had raised an amount worth ₹ 520 crore from KKR India Financial Services through a structured finance transaction.