The office of Madhya Pradesh official liquidator (OL) has told high court that Zoom Developers Pvt, which defrauded banks and other financial institutions to the tune of Rs 2,900 crore, has no assets which can be auctioned to recover bank dues.
The OL office filed this reply before Indore bench of MP High Court in response to the latter’s directive issued on April 27, 2016, in which it had asked OL to form an ‘asset sales committee’ to auction the company’s properties for recovery of dues.
While the court had passed company’s winding up order in November 2014 and appointed official liquidator, the asset sales committee was not formed. Meanwhile, the high court deferred the hearing in this case on Monday.
Zoom Developers is among the top 10 bank defaulters in the country whose business transactions are being investigated by the CBI and the Enforcement Directorate. Owned by accused Vijay Choudhary of Indore who is reportedly absconding, Zoom Developers was set up in 1991 to launch real estate projects in India and abroad, most of which remained on paper.
Besides filing the reply to court, the OL office which functions under union ministry of corporate affairs has directed banks which gave loans to Zoom Developers to inform it about the company’s immovable properties.
“Zoom Developers took loans from banks, invested in other companies which have created assets. Banks should explain as to how they lent handsome amounts to a company which had no assets,” a ministry official said seeking anonymity.
Records submitted before the high court reveal that the company took loan worth Rs 2,900 crore from 26 banks though it had assets worth Rs 74 crore. The company’s balance sheet, which is unavailable after 2007, shows liabilities of Rs179 crore. Of all the banks, Zoom Developers obtained the highest loan of Rs 450 crore from Punjab National Bank. State Bank of India granted the company a loan of Rs 28 crore.
Creditors including banks filed petitions to wind-up company two years back to recover their dues by selling its assets. In addition, Jonathen Allen, the company’s former asset manager in Singapore, also moved court in 2010 for recovery of his dues including his salary worth Singapore $ 879,211.67 (Rs 3.69 crore) in September that year.