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The Central Bureau of Investigation (CBI), investigating the alleged loan fraud committed by Hyderabad-based Deccan Chronicle Holdings Limited (DCHL), has filed a chargesheet against company chairman T Venkattram Reddy and managing director Vinayak Ravi Reddy, who is his brother, in a local court on Wednesday.
The case pertains to a case filed in February, 2013, against the promoters of the media firm, which publishes English daily, Deccan Chronicle, for criminal conspiracy, cheating and forgery, based on a complaint filed by Canara Bank.
The investigative agency also named P K Iyer, then vice-chairman, besides the company’s auditor, C B Mouli and Associates, in the First Information Report (FIR) then.
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According to the FIR, during 2009-2011, the accused entered into a criminal conspiracy to cheat Canara Bank by availing of the open cash credit limit, with periodical enhancements and multiple short-term loans, aggregating Rs 1,230 crore from the bank. The promoters availed of excessive bank finance without adequate drawing power by allegedly giving false financial statements and suppressing the loans taken from other banks, according to the statement.
The investigative agency also alleged that the accused had utilised the short-term corporate loans for purposes other than those for which these were sanctioned. In the FIR, it was further alleged the company had filed fabricated balance sheets, concealing actual borrowings from Canara Bank and other lenders, besides alienating the property mortgaged to Canara Bank. The lender claimed a total loss of Rs 357.77 crore on account of the alleged fraud committed by the company. On February 14, 2015, nearly two years after filing the case, the CBI sleuths of the Banking Securities and Fraud Cell from Bengaluru had arrested the two brothers in connection with the alleged fraud involving Rs 358-crore loan extended by Canara Bank. The agency had named Venkattram Reddy and Vinayak Ravi Reddy as A1 and A2 in this case. While the court authorities have confirmed that the charge sheet was filed by the CBI, the officials of the investigative team, however, were not immediately available to comment on the development.
Earlier, the sessions court had rejected the bail plea of the two accused. High Court judge Justice U Durga Prasad Rao declared the dismissal of the bail petitions filed by the Reddy brothers just before breaking for lunch this afternoon. The court had heard the arguments of the petitioners and the CBI on the bail petitions last week.
The CBI counsel opposed the bail to DCHL promoters on the grounds that the accused would influence the ongoing investigation besides informing the court that the third promoter of the company, P K Iyer, was still at large.
The ongoing CBI case is one of the several loan default cases and the legal and criminal actions initiated by the lenders against the debt-ridden media company. It has total loan dues running into around Rs 4,000 crore as of 2012 according to the promoters' own admission in the year 2013.
In one of such cases, the Supreme Court last month asked the promoters to settle the loan dues with Indiabulls Housing Finance Company (IBHFL) by finding a buyer for the mortgaged residential properties in three weeks. The orders followed after the DCHL counsel informed the court that their client is ready to settle the matter, according to an IBHFL statement.
Since their arrest, the 14 th Additional Chief Metropolitan Magistrate court, which is the statutory court for this case, has been extending the judicial remand of the accused while initially allowing a 5-day custody to the CBI for the interrogation.
"Our clients have been in judicial remand for the past 61 days. As the FIR was filed under the criminal sections of cheating and forgery, our clients are entitled to approach the statutory court for bail after 60 days. Therefore we are now filing a petition before the additional chief metropolitan magistrate court seeking bail for our clients, " a lawyer representing the DCHL promoters told Business Standard after the rejection of their bail petition by the Hyderabad high court.
Later in the day the company promoters filed bail petitions on behalf of Venkattram Reddy and Vinayak Ravi Reddy before the 14th additional chief metropolitan magistrate.
