They have been accused of cheating Canara Bank of ₹198 cr.
The CBI has registered a case against Unitech Limited, its then managing director Ramesh Chandra, and his sons, Sanjay and Ajay, for allegedly cheating the Canara Bank of ₹198 crore. Mr. Chandra’s sons were directors in the company, which had been dealing with the bank since 1971 and had availed itself of various credit limits under multiple-banking arrangement.
In June 2015, the regular limits were renewed for a year and continuation of bank guarantee limit of ₹64.99 crore allowed till its expiry. However, the company did not submit the renewal papers. The bank permitted three months of temporary relaxation, restricting the non-fund-based working capital limit to ₹250 crore.
However, the company did not clear the outstanding. As on May 28 this year, the liability stood at ₹198.09 crore and the contractual liability was ₹95.88 crore. The bank moved the Debut Recovery Tribunal. The account was classified as non-performing asset in March 2017.
The same year, the Economic Offences Wing of the Delhi Police arrested the managing director and his son, Ajay, for allegedly failing to complete a housing project in Gurugram on time.
During an inquiry, the bank found that the mortgaged properties had already been disposed of by the developer. A forensic audit revealed that funds were allegedly diverted and misappropriated. Of the ₹14,270 crore collected from 29,800 home buyers, about ₹5,063.05 crore was apparently not used for the execution of 74 identified projects.
Unitech received ₹1,805.86 crore from six financial institutions, of which ₹763.06 crore was not used for the projects, as alleged. As it turned out, the FIR mentions, three subsidiaries of Unitech made investments of ₹1,745.81 crore in 10 Cyprus-based companies in 2007-10. Investments and advances to related parties were inexplicably written off.