Banks technically write off loans worth over Rs68,000 crore, Mehul Choksi among 50 top wilful defaulters: RTI
IANS 27 April 2020

Indian banks have technically written off a staggering amount of Rs 68,607 crore due from 50 top wilful defaulters, including absconding diamantaire Mehul Choksi, according to a reply under RTI from the Reserve Bank of India (RBI).

Prominent RTI activist Saket Gokhale had filed an RTI query with the RBI seeking details of the 50 top wilful defaulters and their current loan status till February 16.

"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, the RBI's Central Public Information Officer Abhay Kumar provided the replies on Saturday (April 24), with several startling revelations in the 'diamond-studded list', said Gokhale.

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

An inadvertent error had crept in a previous version of the report, which has now been now corrected.

"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.

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.

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

The second in the list is REI Agro Ltd., with an amount of Rs 4,314 crore, and its directors Sandip Jhujhunwala and Sanjay Jhunjhunwala who are already under the scanner of the Enforcement Directorate (ED) since over a year.

The next on the list in the Rs 4,000-crore bracket is absconding diamantaire Jatin Mehta's Winsome Diamonds & Jewellery owing Rs 4,076 crore and which is being probed by the Central Bureau of Investigation for various bank frands.

In the Rs 2,000-crore category, there is the Kanpur-based writing instruments giant, Rotomac Global Pvt. Ltd., part of the famed Kothari group, which owed Rs 2,850 crore.

The others in this category include: Kudos Chemie, Punjab (Rs.2,326 crore), Baba Ramdev and Balkrishna's group company Ruchi Soya Industries Ltd., Indore (Rs.2,212 crore), and Zoom Developers Pvt. Ltd., Gwalior (Rs.2,012 crore).

There are 18 companies in the Rs.1K-segment with some prominent names like Harish R. Mehta's Ahmedabad-based Forever Precious Jewellery & Diamonds Pvt. Ltd. (Rs.,1962 crore), and absconder liquor baron Vijay Mallya's defunct Kingfisher Airlines Ltd. (Rs 1,943 crore).

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 companies.

Six among the 50 top wilful defaulters are connected with the glittering diamond and/or gold jewellery industries.

"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 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.

Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
4 years ago
Writing off Bank Loans by the government is not a show off of magnanimity, but a transferring of or diverting of hard cash of the citizens who had deposited it in PSU Banks in good faith to the thieves in the business - the theft done in connivance with the political leadership from time to time. It is like the words of a sage, "Chor ko kehna chori kar, sadhu ko kehna hoshiar rahe." This is how the Political Democracy functions.

Time has come when citizens of India must think of changing the Political Democracy of India(Dictatorship) to simple democracy of the people, for the people, and by the people. It is not a difficult task, but needs the will and determination of us all.
4 years ago
Loan to ruchi soya was NPA way back, It was into NCLT from where Patanjali acquired this. Acquisition by patanjali was resolution to NPA and not the default by patanjali. I remember from 2013 itself Ruchi soya was stressed assets and later become NPA.
Replied to gouravguptac comment 4 years ago
Yeah! not good..this is very biased reporting..the debt was issued in Congress era itself and reporting as if Baba Ramdev siphoned off money...grow up, please
Replied to satishalive comment 4 years ago
How it is biased this is revealed by Mr. Gokhle they are putting the words of Gokhle now if you want to go in details you should do further research. Don't be a andhbhakt here
4 years ago
Lend loans to anyone with appropriate worth of properties as securities. That is how middle class and poor gets loans right. Why is it different for these corporate companies ?
Replied to m.prabhu.shankar comment 4 years ago
There is lot of difference between individual loans and a large chunk of loans as earnings from the interest on large loans are much larger, and the main objective of the advance is to use huge idle money with bank with one reputed borrower alone. There are different theories. Some think that instead of lending to a thousand individual borrowers, the paperwork, process for monitoring in one account is easy, whereas some other believes that we should not put all our eggs in one basket. Such large advances are mainly consortium advances where the risk is distributed between several banks and monitoring is done by one lead/primary lender bank. The theory then was banks earn 80% only from 20% and focus should be on that 20 % alone and use those resources of 80% in other productive activities. Further some activities require huge initial investment and returns through steady income will be spread to several years. Now there should not be a distraction from this topic and this is only for general discussions. Security is not the alone criterion for lending in modern banking, productivity, and repayment capacity (projected) are only looked into.
4 years ago
I am surprised as to how members can sidetrack the original issue relevant to the context by bringing those names that are never related to or concerned with those issues. Focus on the issue, the supervising and controlling authorities are experts and have the mechanism to fix up the culprits sooner or later.
4 years ago
Majority are all gujjus.... and what about loans taken by Adanis.... Modi and chamchas have stollen more in 5 yrs than congress in 70 yrs. Modi ko 70 yrs diyega, tho pura desh bhej diyega and bhakts will keep saying NaMo NaMo...
we as a nation deserve such assholess
4 years ago
We have heard of a Robin Hood who used to rob the rich to help the poor. Our banks are Dooh Nibor. Now figure that out.
Replied to raviforjustice comment 4 years ago
4 years ago
I may get default on PL. pls let me know how can I convince bank to mark it as write off.
4 years ago
I am surprised that a magazine of your standard comes out with such a wrong headline. RBI cannot write off because the loans were not given by them. RBI has just furnished information regarding loans written off by commercial banks as reported to them.
Replied to asokkumarrathnam comment 4 years ago
Where does the headline mention RBI has written off loans ,it says .
Replied to shreyas2791 comment 4 years ago
Headline before correction: RBI writes off loans worth over Rs68,000 crore, Mehul Choksi among 50 top wilful defaulters: RTI

Replied to shreyas2791 comment 4 years ago
That's what the online headline says (RBI writes off loans worth over Rs68,000 crore, ...) from where I got here.
I can't copy in the screen shot here. But it says above that "An inadvertent error had crept in a previous version of the report, which has now been now corrected."
4 years ago
I have two questions:
1. Will Baba Ramdev please raise his hand and explain what is happening at his end?
2. Will our FM please raise her hand and explain why the Nationalized Banks have to bear the brunt of these frauds?
Replied to ssk.pab comment 4 years ago
Baba Ramdev's group acquired Ruchi Soya last year in insolvency proceedings. He has nothing to do with the default.
Replied to ssk.pab comment 4 years ago
It is purely the discretion of individual banks that sanctioned the loans to those institutions. Neither BRD or PM was responsible for such defaults . When all those attempts to recover those amounts within stipulated time failed, the amounts are written off, and this should not mean that the amount was for ever lost. Banks should not show such amounts as assets in balance sheet. That is all.
Replied to glnprasad52 comment 4 years ago
Yeah ! PM / FM are not responsible for that. They Only know how to acquire funds from RBI and make a budget for Mandir and statue , and how to blame I opposition in everything . That's all they are doing ..
4 years ago
Replied to venugopal.harnoor comment 4 years ago
Why adjustment of books. What does it mean when loan is given and itbis NOT returned back. It is purely ROBBING BANK LEGALLY.

When Education loan is not written off why Business TYCOONS should not be spared.
4 years ago
No loan should be written off, but all companies including all other companies of that board members whether guaranteed or not, should be auctioned to recover the loan. Lenders should be on road like a common man. Amrapali CMD has sighoned public as well as bankers money, but staying in five stars hotels and enjoying like top business man. How...,. Further, banks should compensate such bad loans from their own sources like other PSU...,..becomes sick if bad loans are not recovered. Otherwise these banks will continue disbursing loan at public money, by shaking hands with companies... reason best known to all.
4 years ago
it is not writeoff only it is only provision made in books of accounts of babks revocery is pursued only after closure of the case the amount will be written off do not mislead
Nasreen Rustomfram
4 years ago
And people with hard earned money and life savings lost are suffering in the PMC Bank and other such financial disasters!!
Nasreen Rustomfram
4 years ago
And people with hard earned money and life savings lost are suffering in the PMC Bank and other such financial disasters!!
4 years ago
The report is misleading. RBI is not lender and at the maximum, RBI might have permitted for writing off the wilful defaulters and it need not be construed that it was a permanent loss and maybe accounting adjustment as loss asset and to clean up the balance sheet and at least 30% of the total sum can be recovered. The accountability factor of commercial banks and modus operandi of frauds, connivance of bankers etc., require a deeper probe. Without compromise at various levels, it is impossible to lend such huge amounts without adequate security. Some vital clues are missing.
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