From Aircel to Jet: Canara Bank chases INR 2.49 lakh crore in corporate defaults
Canara Bank ranks fourth among public sector banks for defaults from large corporate, with dues of INR 2.49 lakh crore, according to data compiled by TransUnion CIBIL and examined by The Pioneer as part of its series on large defaulters of India’s PSU banks. Large defaults of 11 PSU banks exceed INR 29 lakh crore. Indian Bank has not yet submitted list of Large Defaulters for the past one year.
Canara Bank has filed 14,277 suits across the country to recover these loans.
Among the borrowers are several high-profile corporate groups. Companies linked to debt-ridden industrialist Anil Ambani owe INR 1,574 crore to the bank. In one case, Jindal Steel and Power, headed by Naveen Jindal, is listed as personal guarantor for dues of INR 1,487 crore related to Reliance Communications. Insolvent Bhushan Power and Steel owes INR 1,229 crore, while PEC India owes INR 1,227 crore. The defunct Jet Airways owes INR 1,972 crore, with the bank listing a company staff as personal guarantor instead of promoter Naresh Goyal.The largest defaulter is fugitive businessman C Sivasankaran’s telecom firm Aircel, which owes INR 4,508 crore
The Seychelles-based promoter of Aircel and Dishnet Wireless owes banks more than INR 20,000 crore. According to the data, one of his company directors, Sudhir Mathur, is listed as personal guarantor to Canara Bank.
Other major defaulters include Shri Lakshmi Cotsyn (INR 3,982 crore), the Lanco Group of former Congress MP L Rajagopal (INR 3,852 crore), Gammon Engineers (INR 3,425 crore), Odisha-based MS Gupta Power Infrastructure (INR 3,303 crore) and companies linked to IL&FS (INR 3,237 crore).
The data shows that in most of these cases the bank has no recoverable collateral apart from personal guarantees. Many loans were sanctioned against company shares whose valuations were later found to be inflated, while several of the companies have since entered insolvency or liquidation.
The records also indicate that several large loans were structured as multiple smaller loans. One example cited is Kolkata-based Nicco Corporation, which is now undergoing insolvency proceedings. The company received 168 separate loans of INR 16.75 crore each from the same Canara Bank branch, amounting to INR 2,815 crore in total.
Other large defaulters include Delhi-based Indure Pvt Ltd (INR 2,770 crore), Winsome Diamonds and Jewellery (INR 2,550 crore), Bengaluru-based Rajesh Exports (INR 2,285 crore), PSL Limited (INR 2,373 crore), Hyderabad-based Gayatri Projects (INR 2,342 crore) and Supreme Housing and Hospitality (INR 2,254 crore). Kolkata-based Rabirun Vinimay Pvt Ltd owes INR 2,024 crore; through the insolvency process, Jindal Steel acquired the company for INR 96 crore, leaving the bank to pursue civil recovery for the remaining dues.
Real estate firm Era Group, controlled by H.S. Bharana and owing more than INR 75,000 crore to Union Bank, also has dues of INR 1,544 crore to Canara Bank. Alok Industries, which owes more than INR 6,500 crore to SBI, borrowed INR 1,746 crore from the bank.
Other borrowers include Concast Steel & Power (INR 1,695 crore), Jay Polychem (INR 1,714 crore), Forever Precious Jewellery and Diamonds (INR 1,364 crore), and DHFL, whose promoters Kapil and Dheeraj Wadhawan face dues exceeding INR 50,000 crore across banks and owe INR 1,250 crore to Canara Bank.
Fugitives Mehul Choksi and Nirav Modi, accused of defrauding Punjab National Bank of over INR 25,000 crore, also borrowed INR 919 crore from Canara Bank. Real estate firm Unitech Ltd owes INR 937 crore, while Trimax IT Infrastructure and Services Ltd has dues of INR 937 crore.
Other defaulters include Mahendra Exports (INR 858 crore), Kolkata-based BBT Elev RD (INR 747 crore), Bibcol (INR 732 crore), Mumbai-based jewellery company Gili India (INR 700 crore), Hyderabad-based IVRCL (INR 790 crore) and Transstroy India Pvt Ltd (INR 653 crore).
