Former State Bank of India (SBI) chairman Rajnish Kumar termed Pratip Chaudhuri’s arrest on November 1 as a motivated action. Rajnish Kumar asked, “It seems a case of overly motivated, high level action. It looks like a mistake of judgment. There is a procedure and rules laid down by RBI for sale of assets to ARC. Where is the corruption here?”
On November 1, Jaisalmer police arrested former State Bank of India (SBI) chairman Pratip Choudhary in an alleged loan scam. The case pertains to properties of the Godawan Group, which had taken a loan of Rs 24 crore from SBI in 2008 to build a hotel.
According to a TOI report, there are allegations against Choudhary of selling properties worth Rs 200 crore for Rs 25 crore after the bank seized him for defaulting on a loan.
As per the dates in the clarification issued by SBI, after the arrest of Choudhary, approval for sale of Godawan properties to Alchemist Asset Reconstruction Company (ARC) was taken in January 2014 and the assignment to ARC was completed in March 2014. .
Choudhary retired from bank service in 2013 and joined the board of ARC in October 2014. The newspaper report said that in 2017 the market value of the property was estimated at Rs 160 crore. Godavan Group had approached the court after the properties were sold for low valuations.
Another top banker, who is in competition, also expressed surprise at the arrest. The banker, on condition of anonymity, said, “If a property is sold to ARC, there are many rules to be followed. Such acts are scary. If this is the case, how will the bankers do development work?”
While reacting to this news, the former deputy managing director of SBI said in a tweet, “Absolutely pathetic, defaulters are playing with the system again despite all the efforts of the Modi government. To improve transparency and introduce accountability. It is time for a major overhaul of judicial procedures.”
He further questioned Chowdhary’s arrest saying, “Without notice and without summons, how can the police of another state arrest someone in Delhi? Where there is due process of law.”
SBI, in its statement, clarified that all proper procedures were followed while making the said sale to ARC. The bank has already offered its cooperation to law enforcement and judicial authorities. Also, if any information is asked from him, he will also give it.
The bank said, “Now from the copy of the proceedings that we have received, it appears that the Hon’ble Court has not been properly informed on the sequence of events. SBI was not a party in this case, hence did not get an opportunity to hear SBI’s side.” “
Further, SBI clarified that “Garh Rajwada” was a hotel project in Jaisalmer, which was financed by the bank in 2007. The bank said the project remained unfinished for more than three years and the main promoter died in April 2010. The account went NPA in June 2010.
“The individual steps taken by the bank to complete the project as well as to recover the bank’s dues did not yield the desired results. Therefore, as part of the bank’s recovery process, the recovery in March 2014,” the bank said. Arrears were allotted to an ARC for
Facebook us for social media updates (https://www.facebook.com/moneycontrolhindi/) and Twitter (.) to follow.
.