21st May, 2023:
In a major development, Union Bank of India has lodged an FIR against M/s. RVM Steels India Pvt. Ltd., Mrs. Ridhima Beswal, Mr. Sameer Agrawal, and several unidentified individuals for their alleged involvement in criminal conspiracy, cheating, and abuse of official position. The complaint, filed by Mr. Debraj Bag, Deputy General Manager of Union Bank of India’s SAMB Mumbai Branch, accuses the accused of causing a wrongful loss amounting to Rs.34.28 crores to the bank between 2013 and 2015. The Central Bureau of Investigation – CBI STB in Mumbai has received the complaint and initiated an investigation into the matter.
Additional details have emerged regarding the activities of RMW Steel India Pvt Ltd. The company was incorporated in 2004 by Mr. Jiwan Kumar and Mr. Gurinder Kumar with the objective of establishing a steel ingot manufacturing unit in Jaipur. In 2013, Mrs. Ridhima Beswal, the wife of Gaurav Kumar, and Mr. Sameer Agrawal assumed management control of the company by acquiring 100% shareholding. The new promoters had prior experience in the steel industry, with Mrs. Ridhima Beswal previously involved in business activities alongside her father, Mr. Arun Beswal, who was a promoter of M/s Pushpak Marktrade Pvt. Ltd.
To support its operations, the company applied to Union Bank of India’s Nariman Point Branch for a credit facility, including a Letter of Credit (LC) and Cash Credit (CC) limit. Following due processing, the bank sanctioned an LC limit of Rs. 15 crores and cash credit limits of Rs. 20 crores on November 1, 2013. Subsequently, an ad hoc limit of Rs. 5 crores was also sanctioned on September 15, 2014.
The account’s non-performing asset (NPA) status can be traced back to several factors. The branch allowed an excess of Rs. 2.60 crores in the account on April 2, 2014, which was later adjusted on April 11, 2014, with the approval of the authorities. Furthermore, an ad hoc limit of Rs. 5 crores, which was disbursed on October 4, 2014, and due for repayment on January 2, 2015, remained unpaid.
Despite the company’s proposal to set up a rolling mill and its request for an enhanced fund-based limit, the term sheet for the enhancement and term loan was declined on November 11, 2014. Renewal of the account was also pending since 2014 due to the non-submission of required information by the company. The CC limit had been overdue since October 22, 2014, and the ad hoc limit of Rs. 5 crores expired on January 2, 2015, without being adjusted. Additionally, all LCs issued to the company devolved, resulting in a loss of Rs. 15.04 crores in January 2015.
The borrower’s non-compliance with submitting regular operational information and failure to cooperate in branch inspections and renewal processes contributed to the account’s deteriorating status. Moreover, the company was found to be routing transactions through Bank of Baroda, despite holding an account with Union Bank of India. This diversion of funds raised concerns about the company’s intentions and its ability to fulfill its payment obligations.
Based on the irregularities uncovered in the account’s operation and the misuse of financial facilities availed from the bank, serious allegations have been made against the borrower company, its directors, and associates. These allegations include criminal misappropriation of public money through diversion and falsification of documents, a criminal conspiracy to cheat the public exchequer by siphoning funds, and committing fraud and criminal breach of trust through related-party transactions.
The FIR reflects the bank’s determination to address the alleged fraud and hold the responsible parties accountable. The investigation, led by Gulshan Rathi, Deputy Superintendent of Police (STB Mumbai), in collaboration with CBI STB investigators, will gather evidence and scrutinize financial records to build a strong case against the accused.
Union Bank of India has pledged its full cooperation in the investigation and is committed to uncovering the truth behind the alleged fraud. The bank emphasizes the importance of safeguarding public funds and preserving the integrity of the banking system.
As the case progresses, further updates regarding the investigation and any subsequent legal proceedings will be made available. The nation awaits the outcome of this investigation, hoping for justice to be served and stringent measures to be implemented to prevent such financial frauds in the future.
