Geetanjali Group promotor Mehul Choksi who is the main accused in the alleged fraud of Rs 12, 700 crore Punjab National Bank had pledged same properties and brand as collateral to various banks to get loans. Surprisingly none of the bank officials even thought of verifying those property documents.
Sources in the investigating agencies stated that Choksi had pledged his “Sangini Diamond” jewellery as a collateral while collecting loans for his two different companies –Gili India limited and Gitanjali Gems limited–from ICICI Bank. The officials said that once the owner of the company is declared fraud the brand value becomes zero.
Choksi had pledged a residential property for two different sets of loans from Allahabad Bank in March 2013 and subsequently modified it in March 2016 and has an exposure of Rs 375 crore. The bank again gave another loan of Rs 750 crore to Choksi on the same flat. The total exposure to the Allahabad Bank is Rs 1125 crores. This much amount was lent to him for a 7510 square feet residential properties, comprising of flat number 101, 201, 203, 301 and 303, in Kalina in Mumbai. Shockingly, the flat number 203 measuring 940 square feet that was pledged to Allahabad Bank was also pledged to two other banks - PNB and Axis Bank. The PNB lent Rs 175 crore to while considering flat number 203 at Kalina as collateral which was already pledged to the subsidiary of Allahabad Bank. And the same flat has been pledged to Axis Bank.
Again for the same flat the PNB gave Rs 75 crore to Choksi’s on December 12, 2012. Interestingly, it accepted the same flat as collateral security.
This loan was approved from Brady House branch of PNB that is under the scanner of issuing letter of Undertakings (loUs) and Foreign letter of Credits (FlCs).
The approval was given despite the fact that PNB led consortium already had an exposure of Rs 225 crore against Choksi and he had defaulted in repayment in May 2011.
“Choksi also pledged flat number 201 at Kalina to PNB and Axis Bank when it was already pledged to Allahabad Bank. Again he did the same with flat number 303 and pledged to three banks - PNB, Axis and Allahabad Bank. Choksi also secured over Rs 440 crore from various public and private sector banks without pledging any collateral,” said sources adding that there are many such and are amazed to find why the banks regularly carried out such irregularities.
The probing agencies are recording the statements of these banks officials to find what such irregularities happened.