Case registered against J&K Bank officials, Rawther Spices director in Rs 350 cr bank loan fraud

Bengaluru (Karnataka) [India], Aug 16 (ANI): The Anti-Corruption Bureau (ACB) on Friday registered a case against officials of Jammu and Kashmir (J&K) Bank and Director of SA Rawther Spices Private Limited Anish Mohd Rawther in a Rs 350 crore loan fraud.
The ACB sleuths had conducted raids at Rawther's residence and office in Bengaluru. During the searches, various incriminating documents and electronic evidence were recovered.
"During verifications, it came to fore that the management at the corporate headquarters/zonal office in Bengaluru and officials of J&K Bank's Infantry Road branch in Bengaluru, has given loans worth crores of rupees to one firm, namely, SA Rawther Spices Private Limited by bypassing all norms and procedures," an official statement from J&K government said.
"During the course of verification, it came to fore that the company was established by one Syed Mohd Rawther in 1985 and was dealing in import and export of spices and coffee," it said.
In 2002, the said company approached the J&K Bank for the loan and the bank initially sanctioned a loan amount of Rs 2 crore against collateral security of three properties valued at Rs 10 crore.
"In the subsequent years that is from 2012 onwards, the bank increased limits of different types of loans enormously which arose up to Rs 308.13 crore in 2015 against increased mortgage or security value to Rs 147.43 crore only. One Shamim Ahmed Haji, a resident of Sopore in Kashmir, who was then branch head of J&K Bank in Bengaluru, processed and facilitated approval by J&K Bank headquarters against collateral property highly disproportionate to the loan amount," the statement said.
The statement further said that the loan amount of Rs 308.13 crore was increased by bypassing all norms or safeguards laid down by the J&K Bank. The company failed to repay the loan on a regular interval and when the account of the said firm was declared a non-performing asset (NPA) in September 2017.
A net amount of Rs 285.81 crore is outstanding with the company besides the unapplied interest of Rs 66.91 crore against mortgaged collateral property valued at Rs 171 crore.
"During his period of posting as branch head, Shamim Ahmed Haji has also processed the file for withdrawal of three prime properties -- Shopping complex at Yashwantpora, industrial property at Gorur and four acres of land adjacent to Hindpur. He exchanged these properties with the new properties such as village Sagu land and abandoned coffee estate located at village Virajpet having less market value," the statement said.
"But then branch manager in connivance with MD of the company Anish Mohd Rawther managed to valuate these exchanged properties at higher price justifying the release of prime properties," it added.
Though the J&K Bank took action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest (SARFAESI) Act and had tried to auction the two properties, the bank has not recovered a single penny so far.
"By this way, officers and officials of J&K Bank in connivance with promoter or director of SA Rawther Spices Private Limited has caused loss to the state exchequer to the tune of Rs 352.72 crore," the statement said.
During investigations, the ACB team obtained search warrants from the Anti-Corruption Court in Srinagar, which got endorsed by the concerned courts in North Bengaluru and thereafter extensive searches were conducted at the residential premises and office of Rawther. (ANI)