Experts see lapses in CGM order

Mumbai: The order issued by Chief Judicial Magistrate, Jaisalmer against former chairman of SBI is full of holes and devoid of facts, says a banker, who has gone into the details of the case. He can't be quoted for the story as he is not an authorised spokesperson of the bank.

It is clear from the above that the entire process was transparent. The bank just sold its financial asset which has no relation with the value of security. The sale by RP was through public notice as per IBC. None of these facts are discussed in the order. The promoters have a track record of managing government officials, filing false cases and intimidating officials by filing FIRs. There is no scope of any wrongdoing by any bank official in the entire story leave apart Pratip Chaudhari who was no longer holding office when the loan was assigned to an ARC. The passing of order against former chairman of the biggest bank ex-party is the height of high-handedness, he alleged.

- The company or its properties were never sold by SBI. Therefore, the valuations mentioned in the order are irrelevant.

- A TL of 24 crore and a CC limit of Rs1 crore were sanctioned by SBI on 4.1.2008. Loan was restructured on 26.1.19. The loan became NPA on 28.6.10. A recall notice for Rs33.93 crore was issued on 1.11.12 and DRT suit filed on 21.7.13 for Rs39.69 crore.

- Sarfesi notice issued, but action could not be taken as CJM sat on the bank's application.

- Bank assigned the loan to ARC, Alchemist for a consideration of Rs25 crore on 20.3.14 thus recovering entire principal.

- Further actions for recovery have been taken by ARC. It took forward DRT case and also tried SARFESI action. The borrower litigated at every stage.

- Finally ARC invoked IBC. The application was admitted on 31.3.17 after a long period due to litigation at NCLT, NCLAT and upto supreme court.

- The promoters filed false FIR against the RP. The RP was arrested and had to seek protection from court. The court in this case gave a landmark order that criminal complaint can only be filed by IBBI against RP.

- Both NCLAT and Supreme Court have passed strictures against the promoters in their orders for filling applications to delay the process. The promoters did not hand over vehicles of the company to the RP, who had to go to the court.

- The RP invited resolution plans in public announcement. CoC found the plan submitted by JFC Finance most suitable. NCLT approved the plan. Promoters tried to delay by filing frivolous application.