Charge sheet filed in IDBI loan case involving Mallya, KFA

The CBI today filed a charge sheet in connection with the IDBI loan default case involving the defunct Kingfisher Airlines in which its promoter Vijay Mallya, who has been declared a proclaimed offender by a court, is a wanted accused.
The agency has named nine people whom it arrested yesterday in the case-- former chairman of IDBI Yogesh Aggarwal, former CFO of the Kingfisher Airlines A Raghunathan, IDBI executives O V Bundellu, S K V Srinivasan, R S Sridhar, B K Batra, and Kingfisher executives Shailesh Borke, A C Shah and Amit Nadkarni--in the charge sheet, leaving out Mallya, as he is yet to be arrested.

A CBI source said the charge sheet mentioned that its special investigation team found there were many commissions and omissions on the part of IDBI officials in the process of sanctioning and disbursement of loan of Rs 1,300 crore to KFA.
According to the probe so far, about Rs 260 crore was diverted by KFA, while Rs 263 crore was used to pay salaries, tax deducted at source, income tax and loan instalments.
A part of the loan amount was also allegedly diverted by Mallya for his "personal expenses".
The CBI source said all the IDBI officials who have been arrested were instrumental in sanctioning and facilitating disbursement of the loan. The entire team of officials from IDBI, from the proposer to the verifier, was arrested yesterday.

According to CBI, a Letters Rogatory (request for legal assistance) has been sent to authorities in British Virgin Islands and Singapore seeking details of use of money lying in Kingfisher's accounts in these tax havens, and the agency is awaiting their reply.

IDBI allegedly showed "undue favour" to KFA in the matter of sanction and disbursement of short-term loans of Rs 150 crore in October 2009 and Rs 200 crore in November 2009, and another corporate loan of Rs 750 crore in November 2009.
"It is further alleged (in the charge sheet) that
significant portion of the disbursed facility (loan) was diverted by Kingfisher to service their existing debt with other banks, and was also diverted to settle the documentary bills discounted by Bank of Baroda," the CBI source said.

Significant amounts were also allegedly remitted out of India on the pretext of payment of lease rental and purchase of aircraft parts, while Rs 3.45 crore was paid into the bank account of Kingfisher in London.
The applications for availing of short term loans were submitted by A Raghunathan wherein he gave reference of meetings between Mallya and then CMD of IDBI, Yogesh Aggarwal. This loan later became a Non-Performing Asset, resulting in loss of over Rs 900 crore to IDBI, the CBI source said.
Meanwhile, the special judge for CBI cases H S Mahajan today remanded all the arrested accused in judicial custody, till February 7, as requested by CBI. Their bail applications will be heard on January 30.