Public sector banks settle minister’s Rs49.20-crore NPA loan
In what appears to be a largesse, two public sector banks, Union Bank of India and Bank of Maharashtra settled a Non Performance Asset (NPA) loan account of Rs49.20 crore associated with state’s labour minister Sambhaji Patil Nilangekar at Rs25.50 crore.
When the settlement was finalised in February this year, the loan taken in 2009 had already been classified as a NPA. The one-time settlement was finalised at Rs25.50 crore by waiving interest and slashing Rs7.50 crore from the principal amount for both the banks. This was confirmed by the Bank of Maharashtra. The accumulated interest was in the range of Rs21.75 crore (together for both the banks) but this could not be confirmed from the banks.
The one-time settlement comes even as the CBI probe in the NPA loan case worth Rs 49.20 crore in 2014 had charged the minister and other directors of this firm with criminal conspiracy. The CBI charge sheet points to tampering of mortgage deed of land, offered as a collateral for the loan and substituting it with property of a smaller size and lesser value.
Victoria Agro Food Processing Private Limited, a company incorporated in 2008 to set up a grain based distillery, had taken a loan of Rs20 crore each from both these banks in 2009, to which Patil-Nilangekar was a guarantor. The grain distillery never took off. When the company was incorporated, the minister’s sister and brother-in-law, Prajakta Marwah and Ashish Marwah were directors of this firm. The company stopped paying dues and interest back to the banks from 2011. In 2014 the banking securities and fraud cell of the CBI filed a case of criminal conspiracy against the company and also named Nilangekar in the charge sheet.
The Union Bank of India’s corporate communication department, in an emailed response, said : “It is a fact that both our bank and Bank of Maharashtra sanctioned OTS in the account of Victoria Agro and Food Industries.. The factory is closed since July 2011 and the entire plant and machinery was gathering junk and deteriorating day by day. Even attempts made by the bank to dispose off secured assets through auction failed multiple times for want of bids.’’
”Therefore in the changed circumstances, the lenders agreed to settle the account under OTS to recover maximum possible amount. The Bank followed set procedure as per RBI guidelines and board approved policy to settle the account.’’
Both the banks pointed out that this settlement will not have any bearing on the criminal case filed by the bank. “Post-settlement, criminal case will not be withdrawn by Bank. All assistance required or called by the investigating agency or court to take the case to its logical conclusion will be promptly provided,’’ said Union bank communication.
Bank of Maharashtra’s deputy general manager in Pune, N Waghchaure said, `”The settlement decision was taken by the bank’s managing committee after following all legal procedures and RBI norms. The settlement was finalized at Rs25.50 crore for both the banks.”
Sambhaji Patil Nilangekar said, “The one-time settlement was done after following all RBI norms. I am not directly associated with this company, I was only a guarantor for the loan.” The CMalso defended his minister in the Assembly, pointing out there was no favour or violation done in the OTS.