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CBI raids Mallya, Kingfisher offices in Rs 900 crore loan default case

According to information, in connection with the case, CBI teams conducted searches at the offices and residences of the accused, three places in Mumbai and one each in Bangalore besides Candolim. Mr Mallya would soon be called for examination in connection with the case.

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The enquiry was to find “how IDBI Bank had sanctioned Rs 950 crore when Kingfisher Airline had a negative networth and negative credit rating”. Talking to reporters here a CBI spokesperson said that a case of criminal conspiracy under IPC section 120-B, along with criminal breach of trust provisions of the Prevention of Corruption Act, was filed in the matter.

The CBI has also searched premises of Kingfisher chief financial officer A. Raghunathan and unnamed officials of IDBI Bank on same charges.

The probing agency acccording to souces has registered a total of 27 cases and inquiries with regards to “bad loans” given by IDBI to various companies two years back.

The Kolkata headquartered United Bank of India (UBI), which was owed Rs. 400 crore by Kingfisher, first declared Mallya a wilful defaulter in May 2014.

“There was no need for the bank to take the exposure outside the consortium when already other loans were getting stressed” reported Times of India.

The FIR was registered after the bank officials failed to explain the rationale behind granting loan to the company, ignoring its own internal report which had warned against such a move.

The raids were made at five places, officials said.

A string of Indian banks have an exposure of almost Rs.7,000 crore in loans to the airline, with the State Bank of India leading with Rs.1,600 crore. “The company cooperated with the officials and provided the necessary documents and will continue to offer co-operation”, UB Group spokesperson Sumanto Bhattachrya said. The agency’s probe is part of the investigation into non-performing assets of various public sector banks. It is learnt that the villa was pledged as a collateral security to banks for raising loans to the now-defunct Kingfisher Airlines.

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Mallya’s airline has been grounded since October 2012.

Vijay Mallya’s allegedly debt-ridden Kingfisher Airlines stopped operations in October 2012