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Loan-default fraud: Winsome ex-staff sent to 14-day CBI custody

Court remands Hasmukh Shah in custody after CBI said they need “to understand the modus operandi of the case”

mumbai Updated: Mar 14, 2018 01:10 IST
Farhan Shaikh
Farhan Shaikh
Hindustan Times
Mumbai,loan-default case,fraud
Hasmukh Shah was arrested on Monday in a multi-crore default-cheating case.(HT FILE)

A special CBI court remanded the former director of Winsome Diamonds Group’s company Hasmukh Shah, and close confidante of the company’s promoter, in 14-day police custody on Tuesday. Shah had been arrested on Monday in a multi-crore loan default-cheating case. The defence, meanwhile, argued that Shah was not the director but head-clerk at the relevant time.

As per the CBI’s case, Shah is one of the authorised signatories for M/s Forever Precious Jewelry and Diamonds. The CBI submitted that Shah signed documents related to the opening of standby letter of credits (SBLCs). The CBI counsel said Shah instructed and pressured other employees for becoming authorised signatories of the company.

The CBI, while seeking Shah’s remand, said, the company has borrowed from a consortium of various banks including Canara Bank, led by Punjab National Bank. The management committee of Canara Bank sanctioned fund-based limit of Rs12 crore and non-fund based limit of Rs150 crore. Out of the sanctioned non-fund based limit the company opened various standby letter of credits (SBLCs) in favour of various bullion banks. The company then purchased gold from bullion banks abroad including The Bank of Nova Scotia, Standard Bank Ltd., and Standard Chartered Bank against these SBLCs.

“This gold was processed and exported to 13 buyers in the United Arab Emirates. It is also alleged that the company failed to make the payment for the gold imported against the SBLCs. The company pleaded not receiving the proceedings from foreign buyers resulting in invoking of the SBLC, which cost wrongful loss of Rs146.35 crore to Canara Bank,” CBI counsel A Limosin told the court.

Limosin further submitted before the court that a total 11 cases have been registered against M/s Winsome Diamonds and Jewelry Ltd and M/s Forever Precious Jewelry and Diamonds incurring a total loss of Rs4,625.43 crore.

M/s Forever Precious Jewelry and Diamond Ltd was engaged in production facilities for cutting and polishing of diamonds and for manufacture of plain and studded gold jewelry. The manufacturing units of the company are located at various cities including Ahmedabad, Cochin and Chennai.

CBI also alleged that Shah was coordinating all exports and imports being done from Chennai and Cochin units for the company and giving directions to the units’ heads.

The defence argued that Shah is not the beneficiary for the amount.

Additional sessions judge VV Kathare remanded Shah in police custody after CBI said they need “to understand the modus operandi of the case and to unearth the larger conspiracy and ascertain the exact magnitude of the scam.”

First Published: Mar 14, 2018 01:10 IST