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Gandhi reiterates STI is defaulter

GUJARAT MERCANTILE Credit Sahkarita Limited (GMCSL) has reiterated that Steel Tubes of India (STI) has taken a direct loan from the cooperative and is a defaulter.

india Updated: Jan 12, 2006 01:04 IST

GUJARAT MERCANTILE Credit Sahkarita Limited (GMCSL) has reiterated that Steel Tubes of India (STI) has taken a direct loan from the cooperative and is a defaulter.

Denying STI’s claim that its group of companies have not taken loans from the Cooperative, GMCSL Managing Director Janak Gandhi said that there were several meetings between STI and the cooperative for settlement of loan accounts.

“We have documentary evidence to prove that we have given swap loan to STI and its group,” Gandhi said in a statement issued here today.

He also dismissed the STI claim that GMCSL approached STI and requested to help Lloyds Finance. On the contrary, Lloyds Managing Director G C Garg asked credit cooperative in September 1999 to sanction Rs 5.73 crore as they owed more than this amount to the financing agency.

Thus a three-party agreement was made between Lloyds Finance, Gujarat Mercantile Credit Cooperative (GMCC) and STI in 1999. STI accepted liability of Lloyds Finance towards GMCC to be Rs 5.73 crore against its overdue outstanding amount with the financing agency.

STI, Gandhi said, has confirmed in its letter dated March 31, 2002 that they owe GMCC Rs 8.87 crore and apart from that they requested GMCC to divide liabilities among its other companies.

As per their request, a sum of Rs 8.87 crore was distributed among STI Limited (Rs 3.87 crore), STI Products Ltd (Rs 2 crore), STI International Ltd (Rs 1 crore) and STI Finance Ltd (Rs 2 crore), Janak added.

He added that there are documentary proofs that cheques issued by STI bounced. “The STI group owes us Rs 14.86 crore till date,” Gandhi said in the press release.

First Published: Jan 12, 2006 01:04 IST