That is the title of a Report by business-standard.com, April 29, 2020.

While the country is drowned in reports about Covid-19, this news did not so much attract the attention of people. We celebrate the World Press Freedom Day with a report on this issue.

The Indian media, known for its sensationalism did not somehow highlight it, nor gave it the coverage it deserved. Like so many events, Covid-19 came to the rescue of the government, in covering up the information. RTI helped in this case, but media minimized the damage to the Modi regime, as much as it could.          

Indian banks have written off Rs 68,607 crore of debt of top 50 willful defaulters till September 30, 2019, said the Reserve Bank of India (RBI) in response to a petition filed under the Right to Information (RTI) Act. The list of top 10 is given at the end of this report.

The RTI query was filed by Saket Gokhale (photo below), an activist, on March 19 this year, and he received the list on April 24. It lists defaulters till September 30 last year, which means either the RBI did not update the list, or further willful defaults above Rs. 5 crore did not happen in this period to update.

saket gokhale

The activist was seeking “details of the 50 top wilful defaulters and their current loan status till February 16.”

The RBI said the amount (Rs 68,607 crore) comprises outstanding and the amounts technically/prudentially written off till September 30, 2019.

The RBI reply thus lists defaulters till September 30 last year, which means either the RBI did not update the list, or further willful defaults above Rs 5 crore did not happen in this period to update, reported business-standard.com.

“The apex bank also declined to provide the relevant information on overseas borrowers citing a Supreme Court judgement of December 16, 2015,” Gokhale told IANS.

“I filed this RTI because Finance Minister Nirmala Sitharaman and Minister of State for Finance Anurag Thakur had refused to reply to this starred question asked in the Parliament by Congress MP Rahul Gandhi in the last Budget Session on February 16,” Gokhale told IANS.

Disclosing what the government didn”t reveal, the RBI”s Central Public Information Officer Abhay Kumar provided the replies on April 24, with several startling revelations in the ”diamond-studded list”, said Gokhale :

Six among the 50 top wilful defaulters are connected with the glittering diamond and/or gold jewellery industries, reported IANS. This sector is mostly concentrated in Gujarat, the home state of PM Modi and Home Minister Amit Shah, it may be noted.

Topping the list is Choksi”s scam-hit company, Gitanjali Gems Limited, which owed Rs.5,492 crore, besides other group companies, Gili India Ltd and Nakshatra Brands Ltd, which had taken loans of Rs 1,447 crore and Rs 1,109 crore, respectively. Thus this Group’s amount adds up to Rs 8048 cr.

Choksi is currently a citizen of Antigua & Barbados Isles, while his nephew and another absconder diamond trader Nirav Modi is in London.

Jatin Mehta’s Winsome Diamonds & Jewellery was owing Rs 4,076 crore. Harish R. Mehta’s Ahmedabad-based Forever Precious Jewellery & Diamonds Pvt. Ltd. owed Rs.,1962 crore.

Baba Ramdev is also on the list who owes Rs 2,212 crores. Absconder liquor baron Vijay Mallya’s dead Kingfisher Airlines Ltd. is also on the list owing Rs 1,943 crore.

Here’s the list of fugitive economic offenders who are residing abroad, according to thenews21.com : Pushpesh Baid, Ashish Jobanputra, Vijay Mallya, Sunny Kalra, Sanjay Kalra, SK Kalra, Aarti Kalra, Varsha Kalra, Jatin Mehta, Umesh Parekh, Kamlesh Parekh, Nilesh Parekh, Eklavya Garg, Vinay Mittal, Nirav Modi, Neeshal Modi, Mehul Choksi.

“I asked a straight question in Parliament – state the names of the 50 top bank loan defaulters in the country. The finance minister refused to answer the question. Now the RBI has given the names of Nirav Modi, Mehul Choksi and many of BJP’s ‘friends’ in the list of bank frauds. That is why this truth was held back from Parliament,” Rahul Gandhi said in a tweet in Hindi.

“A majority of them have defaulted prominent nationalist banks over the past several years and many of them are either absconding or facing action by various probe agencies and some are under litigation,” Gokhale said.

No industry however is sacrosanct as the top 50 willful defaulters are spread across various sectors of the economy including IT, infrastructure, power, gold-diamond jewellery, pharma, etc.

‘Tukde Tukde Gang’ :

It was the same activist, it may be recalled, who had asked, on December 26 , 2019, about the ‘Tukde Tukde Gang’.In a reply, dated January 20, 2020, The Ministry of Home Affairs (MHA) said that it has “no information” concerning the ‘Tukde Tukde Gang’ — a term that has been used a number of times by PM Narendra Modi and Home Minister Amit Shah to attack opponents.

In his RTI application, Saket Gokhle said Home Minister “Amit Shah addressed a public event in New Delhi, and in his address said, ‘The Tukde Tukde Gang of Delhi needs to be taught a lesson and punished’.” Gokhle’s RTI asked for details of the ‘Tukde Tukde Gang’. The home ministry, in its reply to Saket Gokhle’s RTI application, said, “Ministry of Home Affairs has no information concerning tukde-tukde gang.”

tukde tukde gang

Like Amit Shah who stuck to the epithet ‘Tukde Tukde Gang’, despite RTI reply above, Finance Minister Nirmala Sitharaman stuck to the policy of the Govt., and took shelter under a technical explanation, which the Govt should have given in parliament, but avoided.

business-standard.com reported her argument:

Stung by the Opposition’s attack on the issue, Nirmala Sitharaman said that the Modi government was cleaning up the financial system, going after wilful defaulters, and accused the Congress of ‘sensationalising’ and being ‘brazen’ in misleading people on the subject.

“Congress and Rahul Gandhi should introspect why they fail to play a constructive role in cleaning up the system. Neither while in power, nor while in the opposition has the Congress shown any commitment or inclination to stop corruption and cronyism,” Sitharaman tweeted late on April 28 Tuesday night.

“Rahul Gandhi and Randeep Surjewala (Congress spokesperson) have attempted to mislead people in a brazen manner. Today’s attempt of Congress leaders is to mislead on wilful defaulters, bad loans & write-offs,” Sitharaman said.

Both are adept in the blame game, people by now realized. They play their due roles depending on who is in power at the given time.

The technical answer for the cover up is as follows:

The write-offs are technical or prudential in nature, which means the banks have made 100 per cent provisions against the loans. However, this doesn’t mean the banks have given up the right to recover the loans. It also doesn’t mean that banks have written off the entire loan, as some loans have been taken against security, which either can be or already has been recovered.

As and when they recover the money, it directly adds up to banks’ profits, and the provisions also come down by that extent (business-standard.com).

RBI maintains records of loans above Rs 5 crore given by banks, both fund and non-fund based, in its Central Repository of Information on Large Credits (CRILC) database. If any entity defaults, the RBI captures it.

The definition of a willful default is lengthy and conditional, but it simply points to a default by anyone who has the means to pay but won’t.

Gitanjali Gems, owned by Mehul Choksi, was a darling of the stock markets. Soon after the Nirav Modi scam came out in the open, the Central Bureau of Investigation (CBI) found that Choksi and Modi used the same tactics to defraud banks. Choksi, Modi’s maternal uncle, used to open letters of credit in the name of foreign suppliers.

The duo were helped by a few Punjab National Bank employees. Both Modi and Choksi showed fake transactions among various offshore entities and took Indian banks for a ride. The CBI and Enforcement Directorate filed a chargesheet against Choksi and other top officials of Gitanjali Gems.

The List of top 10 is as below:

defaulters

The Report on RBI’s list of wilful defaulters contained Top 10. Even the smaller but big enough defaulters should not be missed to be recorded. Hence this more detailed list, given as an Annexure by RBI.

Out of 50 listed below, there are seven companies in the Rs 2,000 crore plus  segment; 18 companies in the Rs 1,000 crore plus segment. Another 25 companies fall in the sub-1K crore category with outstandings ranging from Rs 605 crore to Rs 984 crore, either individually or as group.

RIA

RIA1

 


SIGN UP FOR COUNTERCURRENTS DAILY NEWS LETTER


 


Countercurrents is answerable only to our readers. Support honest journalism because we have no PLANET B. Subscribe to our Telegram channel


GET COUNTERCURRENTS DAILY NEWSLETTER STRAIGHT TO YOUR INBOX


2 Comments

  1. Donations towards Covid19, anyone?

  2. samir sardana says:

    THE RBI DELIBERATELY HIDES THE NAMES OF NPA AND FRAUDS,SO THAT THESE CRMINAL BORROWERS GET A CHANCE TO LOOT OTHER BANKS AND NBFCs, AND SO THE CREDIT AND GDP KEEPS MOVING !

    THIS IS THE CORE OF THE BUSINESS MODEL OF THE RBI ! IF THESE NAMES ARE KNOWN – NO ONE WILL LEND TO THEM OR THEIR SUPPLY CHAIN – AND THAT WILL BE THE END OF BANKING ! dindooohindoo

    FACT IS – RBI AIDS CRMINALS
    FACT IS – W/O THESE CRIMINALS THERE IS NO INDIAN INDUSTRY AND NO INDIAN BANKING !

    Why can the RBI not disclose the names of the NPA and Fraud borrowers ? .Besides the fact that the data can be obtained from the FIR and Court Records (as any Court record can inspected and copied after paying a fees and giving an affidavit) and is also possibly available with CIBIL on the web

    • At this stage it is assumed that a Borrower identified for fraud AS AN NPA from A BANK in this nation and/or on whom a FIR is filed would NOT be able to avail of loans from any other FINANCIAL INSTITUTION in this nation OR WITH STRINGENT CONDITIONS AND SECURITIES ( by law and disclosure of data to all FINANCIAL INSTITUTION s) – this is the least that Indians can HOPE for.It is assumed that this honor would also extend to all Directors and Promoters of the borrower AND THE ASSOCIATE AND GROUP COMPANIES

    • WHY SHOULD THIS CAVEAT AND CAUTION NOT BE AVAILABLE TO ALL CITIZENS AND ENTITIES IN THIS NATION OR FOREIGNERS AND OVERSEAS ENTITIES OPERATING IN THIS NATION ?

    • THIS RIGHT TO HAVE THE LIST OF THE FRAUDULENT AND NPA BORROWERS IS SOUGHT BY EMPLOYEES,CREDITORS,CHIT FUNDS, DEPOSITORS, DEALERS, SUPPLIERS, SMALL FINANCIERS,MSME, NIDHIS,CO-OPERATIVES, FARMERS ,SPECIALISED REGULATORS ETC TO ENSURE THAT THEY ARE NOT DEPRIVED OF THEIR RIGHT TO PROPERTY,ASSETS AND PEACE OF MIND – AND ITS REFUSAL IS A VIOLATION OF ARTICLE 14 AND 21 OF PART 3 OF THE INDIAN CONSTITUTION

    • Is the aim of the RBI and the Banking system to shift these fraudulent /NPA borrowers to alternative financiers – and then use those collections to make a settlement and recovery from the borrower ? Is that in public interest ?

    • Is it the mandate of the RBI and the banks to protect financial criminals and inept managements and assists them in fund and income generation ?

    – Is a perception that the BANKERS are HIDING THEIR CORRUPTION, COLLUSION AND NEGLIGENCE IN THE BANK FRAUDS/NPAs – BY SUPPRESSING THE NAMES OF THE BORROWERS – IN PUBLIC INTEREST AND THE CREDIBILITY OF THE FINANCIAL INSTITUTION ING SYSTEM

    • Is it not in public interest to know IF THE FRAUDULENT /NPA BORROWERS HAVE A NEXUS OR CONNECTION WITH BANK STAFF OR THE BANK BOARD OR THE BANK STAFF AND BOARD OR THE POLITCAL APPOINTEES ON THE BANK BOARDS,AUDITORS , MINISTERS AND POLITICANS ?

    – Can a BANK fraud enquiry be concluded w/o a FIR ? If a Politician has to disclose all his Cases to the CEC and is placed in the public domain – why can the BANK borrowers on whom charge sheets are filed – NOT be in the public domain – due to their proximate of possible connections with Politicians, possibility of being in public positions (Hospitals,Schools, NGOs etc),operations in sensitive businesses (defense,pharma,anti-narcotics etc.) etc
    – Even if the NPA borrower is sustaining its operations by alternative financing and other unethical practices – it poses a big risk to its supply and value chain and also on matters of insurance, manufacturing risk, no R & M and matters of quality and adulteration and mislabelling on products of public import – such as food and pharma – Is this in public interest
    – By not placing the information in the public domain – the RBI and the Banking system is providing the impetus to the borrower to repeat the fraud/ineptitude with the supply chain and the Alt-Financiers – as the primary aim of the borrower is to warehouse and ring fence the funds in offshore jurisdictions, erase forensic trails and set the base for complex and protracted litigations
    – The Criminal action and Fraud by the RBI and the Banks is manifest in the secrecy of BANK Borrower fraud data (by a conspiracy of silence and obduracy of refusal),to provide a perfidious window of theft,to the said entities to raise credit from the unorganised sector, retail,Chit funds/ Nidhis/Societies – using a chain of brokers and front companies,to spread the virus of the credit default menace, across the nation in terms of geography, sector and most importantly, the ignorant classes and masses.This credit is at a high cost and will bankrupt the said entity and lead to massive financial fraud by the said entity and huge losses to the unorganised lenders and ignorant creditors.This is a form of fraudulent misallocation of capital to unviable and non-economic purposes by the fraudulent actions of the Banks,REC and the state.This is neither in public or national interest

    – Equity and other investors have a right to obtain BANK Fraud/NPA data for units, sectors, geographies, clusters and supply chain networks,as these pose an existential risk to the viability and business models of several entities.Hence the NPA data is sought in public interest

    – Disclosure of BANK/NPA and Corporate Fraud is also in public interest,as it might place the supply chain of Performing Assets at severe operational and credit risk,as a 5-10% credit default of 1 supplier in the supply chain of a Performing Asset (who is also a supplier to a BANK Fraud afflicted entity) can disrupt and destroy the entire supply chain and PPC of a Performing Asset.

    – Besides a BANK NPA or Corporate Fraud afflicted entity being a loss and destruction of an economic asset, it is also a huge loss to society and the welfare state,as the said entity is unable and unwilling to focus on R&D,Branding, Innovation,New Product Development etc.,and has no option but to default on regulatory compliances (such as pollution ,effluents, waste disposal, disposal of hazardous materials,worker safety,use of dangerous, unstable and hazardous materials etc.) – as it has a 18-24% margin disadvantage, just in terms of financing charges.This makes it critical to ensure that the information on BANK Fraud Borrowers is in the public domain and such a treatment is in public interest.

    – The argument that FINANCIAL INSTITUTIONs are allowing such assets to linger,as it is a form of mothballing or extinguishing surplus manufacturing capacity,is an act of unmitigated criminality – which makes it imperative that the borrower fraud data should be in the public domain

    – If fair arm length creditors refuse to finance BANK fraud/NPA assets,or are not hoodwinked into funding such assets, the economic capacity of the said asset will get a serious financial investor who is not motivated by fraud and theft – and this makes it imperative that the BANK borrower fraud data should be in the public domain

    – If a NPA is induced by state action such as PPA/Environmental issues for Power Plants or delayed land acquisitions or arbitration cases – then all this will be disclosed in the media and the directors and auditors reports, and so ,what is problem in disclosing this information.Should this information not be in the public domain to caution non bank creditors ,small suppliers and employees ? Is that not in Public Interest ?

    – If an NPA is induced by management incompetence and fraud,should this information not be in the public domain to caution non bank creditors ,small suppliers and employees ? Is that not in Public Interest ?