Rs. 2,061-crore Maharashtra MSC Bank fraud: HC asks police to file FIR in five days

Most of the 48 directors of the Maharashtra State Cooperative Bank at the time when the alleged fraud was committed between 2001 and 2011 were elected representatives from various parties.

The Bombay high court (HC) on Thursday directed the Economic Offences Wing (EOW) of the Mumbai Police to register a first information report (FIR) in the alleged Maharashtra State Cooperative (MSC) Bank fraud case within the next five days.

Apart from politicians, senior officials of the MSC Bank, officials of district central co-operative banks across Maharashtra and officials of certain co-operative sugar factories, which purportedly availed fraudulent loans, are likely to be named as accused. (HT FILE)

The list of accused is likely to include political heavyweights from Maharashtra.

Most of the 48 directors of the Maharashtra State Cooperative Bank at the time when the alleged fraud was committed between 2001 and 2011 were elected representatives from various parties.

Some of the directors were Ajit Pawar, Vijaysinh Mohite-Patil, Anand Adsul, Dilip Deshmukh and Hasan Mushriff, among others.

Reacting to the court’s order, NCP leader Ajit Pawar said he can react only after receiving the court order. “I have done nothing wrong while working with MSC Bank. I have not received the court’s order. I will discuss the matter with my legal advisor and then decide the next move,” Pawar said.

Apart from politicians, senior officials of the MSC Bank, officials of district central co-operative banks across Maharashtra and officials of certain co-operative sugar factories, which purportedly availed fraudulent loans, are likely to be named as accused.

The 57-year-old Andheri resident sought action against the political leaders and bank officials on the basis of a 2011 National Bank for Agriculture and Rural Development (NABARD) inspection report and reports of inquiry under provisions of the Maharashtra Co-operative Societies Act, 1960. Both reports had disclosed rampant malpractices in loans disbursed by MSC Bank and consequent loss of crores of rupees.

The bench accepted Arora’s contention that the NABARD inspection report revealed the illegalities. “The inspection report not only points out the discrepancies and irregularities committed by the respondent bank and its officials, but also points out that the trust reposed in the bank and its officers has been brazenly breached,” said the bench. “The report prima facie discloses that the bank records were forged and profits were wrongly shown by abusing the income recognition and asset clarification norms.”

“The report also showed that the non-performing assets (NPA) accounts intentionally camouflaged in as much as the amounts sanctioned and disbursed to the units wherein the directors of the bank having interests were not included in periodic reports of the bank with a view to safeguard the interests of the directors.”

Observing that the reports in terms showed that illegal loans were sanctioned and secured assets were sold out at throwaway prices, contrary to norms, the judges said the reports prima facie constituted credible material disclosing the commission of cognisable offences and therefore it was necessary to order the registration of offence against the concerned.