In case alleging siphoning off of over Rs 12,000 crores of loans by office-bearers of Amtek Auto Ltd, the Supreme Court on Thursday sought reports from both the Central Bureau of Investigation (CBI) and Serious Fraud Investigation Office (SFIO) which are investigating the case.
The court has directed the investigating agencies to file the response before 9th December and directed the case to be listed on December 13.
A bench led by the Chief Justice of India UU Lalit has also asked CBI and SFIO to seek response from the banks involved in the case who haven’t responded and include their response in the said status report.
The court issued a direction noting that investigations into affairs of corporate entity are being undertaken by these agencies and while the investigation undertaken by SFIO is concerned is comparatively at an advanced stage, CBI’s investigation is yet to take off.
Advocate Jai Anant Dehadrai appearing for the petitioner argued that the magnitude of this bank scam is unprecedented going up to around Rs 23,000 crores and requires court’s monitoring.
He added that 19 banks are part of the consortium and only one has confirmed that the former promoters have been classified as fraud, and that too after the court issued notice in the case. He therefore urged the court to consider impleading these banks as parties and seek their response on affidavit
The Amicus Curiae appointed by the court today suggested that the case be simultaneously investigated by the Enforcement Directorate. He added that public money is involved in the case, and the idea is to get the money back. He added that SFIO is handling investigation for past two years but has only progressed a little.
The counsel appearing for the investigating agencies submitted that the SFIO is investigating into the aspect of corporate fraud. He added that forensic auditors have been appointed which will take another 6-8 months to file a report.
While noting that huge amounts of money is involved in the case, the bench noted that it has to be conscious of scope of the petition filed under Article 32 which has been filed alleging some mismanagement in structure of a corporate company.
The court further opined that before the court goes into the issues, it’s relevant for the court to understand the fate of the investigation and where it has led both the investing agencies.
It may be noted that CBI recently submitted before SC that IDBI Bank has declared as fraud the former promoters/directors of Amtek Auto Ltd, but has not declared the company a fraud.
According to CBI’s affidavit, IDBI Bank informed that it’s in the process of finalising and filing a complaint against former promoter/directors of the company.
The CBI stated that it approached 19 banks which extended credit facilities to Amtek, seeking the status of declaration of Amtek’s account as fraud and filing complaints with the central probe agency in case the firm’s account is declared as fraud.
Out of the 19 banks CBI approached, only five banks–IDBI Bank, Bank of Maharashtra, PNB, SBI and IFCI Ltd–responded. The four respondent banks, barring IDBI, did not declare Amtek’s account as fraudulent. Fourteen other banks are yet to respond.
The CBI had acted pursuant to a complaint which alleged Amtek Auto promoters fraudulently siphoned off crores, availed through credit facilities from a consortium of banks, by routing through 127 related companies/firms/parties.
