Shareholders coming out of the Bank of Maharashtra head office in Shivajinagar after the annual general meeting on Thursday.(Pratham Gokhale/HT Photo)
Shareholders coming out of the Bank of Maharashtra head office in Shivajinagar after the annual general meeting on Thursday.(Pratham Gokhale/HT Photo)

Bank of Maharashtra arrests: Post arrest, MD complains of chest pain, reports normal

Sushil Muhnot, former CEO, also remanded in police custody on Thursday
Hindustan Times, Pune | By Nadeem Inamdar
UPDATED ON JUN 22, 2018 04:28 PM IST

Ravindra Prabhakar Marathe, managing director and chief executive officer (CEO), Bank of Maharashtra (BoM), who was arrested on Wednesday and remanded to police custody till June 27, was taken to Sassoon general hospital on Thursday after he complained of chest pain during his first night in police custody. However, he was discharged at around 7pm as all his reports were normal, said a doctor from the hospital.

Marathe was produced in court along with Rajendrakumar Vedprakash Gupta, executive director, BoM; Sunil Madhukar Ghatpande, chartered accountant working for DS Kulkarni developers limited; and Rajeev Dulabhdas Nevaskar, chief engineer and vice-president of DS Kulkarni developers limited.

They were remanded to police custody till June 27 after their arrests under various Sections of the Indian Penal Code (IPC), Section 3 and 4 of the Maharashtra Protection of Interest of Depositors (MPID), Sections 3, 4, 5 and 6 of the Prize Chit and Money Circulation (Banning) Act, 1978 and Sections 45(s), 45(i) and a/58 of the Indian Reserve Bank Act, 1934. The case in the matter was registered at Shivajinagar police station.

On Thursday, Sushil Muhnot, former managing direction (MD) and chief executive office (CEO) of Bank of Maharashtra (BoM) was remanded to police custody till June 27 by a Pune court on Thursday.

Sudhir Hiremath, deputy commissioner of police, economic offence wing (EOW) and cyber crime said Muhnot was arrested for colluding with DS Kulkarni, chairman and managing director of DSK Developers Ltd, who is in judicial custody at Yerwada central jail in a case of fraud worth Rs 2,043 crore.

Muhnot was arrested from Ahmedabad and produced in the court of special judge RN Sardesai. Another person, Nityanand Sadashiv Deshpande, zonal manager, BoM, was also arrested in the case from Jaipur.

“Deshpande will be produced in court on Friday,” said DCP Hiremath.

“Muhnot was brought from Ahmedabad on Thursday while Deshpande was in transit remand granted by a court in Jaipur. He will also be produced in court on Friday,” said Pravin Chavan, the public prosecutor in the case.

Shirish Kulkarni, DS Kulakrni’s son, whose anticipatory bail application was turned down by the Supreme Court, has been directed by the apex court to surrender before the police by June 25.

A chargesheet was filed in the matter against DS Kulkarni and Hemanti Kulkarni, his wife, on May 17. A supplementary chargesheet will be filed against the arrested people after due investigation and adequated proof is produced, according to a police statement.

Meanwhile, property and belongings of DS Kulkarni and related companies have been seized and are being auctioned.

Loans to DSK group fully secured, shareholders told at AGM

Six of the eight directors of Bank of Maharashtra kept away from the 15th annual general meeting of the bank on Thursday amidst sharp disappointment expressed by a number of shareholders who were present at the meeting.

About 200 shareholders were present at the meeting, many disappointed with the arrests of the top executives of the bank, and said that this had tarnished the image of the bank in the eyes of the public.

Addressing the shareholders, AC Rout, executive director, said, “Various initiatives taken up by the bank for a turnaround, such as a focus on non-performing asset recovery, credit expansion with diversified risk, controlling slippages and improving operational efficiency, are on track.”

Replying to concerns raised by a few shareholders with regards to the amount advanced to DS Kulkarni developers limited (DSKDL), Rout explained that the bank’s present outstanding exposure to the group stood at Rs 94.52 crore, which was fully secured. The bank has already declared DSKDL and its promoters as wilful defaulters and recovery processes have already been initiated, he added.

He assured shareholders that the bank was taking all efforts for a turnaround and added that the operating profit for the year (ended March 31), increased by about 20% year-over-year. During the meeting, shareholders approved raising of equity capital through follow-on public offer/rights issue/ qualified institutional placement / preferential share, aggregating to Rs 3,000 crore.

Bank of Maharashtra shares slump 7% after CEO’s arrest, hit fresh 52-week low

Shares of Bank of Maharashtra continued to fall for the second straight session on Thursday, dropping over 7% to hit a 52-week low, following the arrest of its chief executive officer in a cheating case. Bank of Maharashtra shares, after a weak opening, extended losses by falling 7.20% to Rs 12.50—its 52-week low—as the session progressed on BSE.

On NSE, stock of the company tumbled 7.11%to hit its one-year low of Rs 12.40. The Economic Offences Wing of Pune police on Wednesday arrested six people, including the serving and a former CMD of Bank of Maharashtra in a cheating case lodged against real estate developer D S Kulkarni and his wife, an official said.

The bank’s present CEO and managing director Ravindra Marathe, executive director Rajendra Gupta, zonal manager Nityanand Deshpande, and bank’s former CMD Sushil Muhnot, were arrested on Wednesday.

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