A special Central Bureau of Investigation (CBI) court in Pune has convicted a businessman and a retired credit manager of a nationalised bank for carrying out a loan fraud that caused losses to the public sector lender.
The case, which dates back to transactions between 2010 and 2011 at the bank’s Pimpri branch, culminated after an eight-year-long trial. The court found that the accused conspired to cheat the bank by securing a cash credit facility using forged documents and misrepresentation.
According to the judgment by Special CBI-ACB judge Rajendra Mendhe on April 28, “The accused agreed to do or caused to be done an illegal act to prepare forged documents, used it as genuine and cheated the Central Bank of India.”
The court held that the conspiracy was partially proved, particularly establishing offences under criminal conspiracy and cheating.
The order said, “Accused on the basis of forged documents processed and sanctioned cash credit limit without authority and by disbursing cash credit facility caused wrongful loss to bank. It is argued that all the accused hatched conspiracy and committed the offence of cheating and forgery. It is also argued that though there is no direct evidence of criminal conspiracy, criminal conspiracy is always hatched in secrecy and it is impossible to deduce direct evidence of the same. It is argued that on the basis of testimony of the prosecution witnesses, the prosecution proved all the charges against accused and the accused are liable to be convicted for all the charges and they be punished as per law.”
Businessman Rajesh Panghal was convicted on multiple counts under the Indian Penal Code. The court sentenced him to rigorous imprisonment of three years each for offences under Sections 120B (criminal conspiracy), 420 (cheating), and 468 (forgery), along with fines. He was also awarded one year of rigorous imprisonment under Section 471 (using forged documents as genuine).
{{/usCountry}}Businessman Rajesh Panghal was convicted on multiple counts under the Indian Penal Code. The court sentenced him to rigorous imprisonment of three years each for offences under Sections 120B (criminal conspiracy), 420 (cheating), and 468 (forgery), along with fines. He was also awarded one year of rigorous imprisonment under Section 471 (using forged documents as genuine).
{{/usCountry}}Retired bank official Nandkishor Khairnar, who served as a credit manager at the bank, was found guilty of abusing his official position. The court observed that the prosecution successfully proved that he “dishonestly prepared and submitted a false inspection report” and facilitated the fraudulent loan process. He was sentenced to three years’ rigorous imprisonment under provisions of the Prevention of Corruption Act, along with a fine.
The prosecution case revealed that Panghal had applied for a cash credit limit of ₹50 lakh in the name of his firm, M/s Nitesh Pressing, by submitting forged documents including fabricated income tax returns, a false project report, and a forged agreement for a flat used as collateral. The court noted that forged documents were used to obtain the loan.
The investigation uncovered that Panghal was holding multiple PAN cards and had already mortgaged the same property with another bank. Despite this, the loan was processed and sanctioned at the bank.
It was established that the then branch head (since deceased) and Khairnar bypassed mandatory checks. The fraud came to light when a post-sanction inspection revealed that no business activity or stock existed at the borrower’s premises. The account subsequently turned into a non-performing asset (NPA), resulting in a loss of over ₹52 lakh to the bank.
During the trial, the prosecution examined 19 witnesses and presented documentary evidence. The defence argued that the case was of a civil nature involving loan default. However, the court rejected this argument, holding that the evidence clearly established criminal intent and conspiracy.
The case was investigated by the CBI’s anti-corruption branch, Pune, following a complaint filed by a bank official in 2016.