A Special Court on Wednesday granted bail to Ravindra Marathe, managing director (MD) and chief executive officer (CEO) of Bank of Maharashtra (BoM). Last week, Marathe, along with five others were arrested by the Pune Police in the DS Kulkarni fraud and cheating case.
SN Sardesai, Special Judge for Maharashtra Protection of Interest of Depositors (MPID) Act, granted bail to Marathe on a surety of Rs50,000.
The arrest of Marathe and other top executives from Bank of Maharashtra had sparked a row with Bank employees and Indian Bank Association (IBA) accusing police of high handedness and overreach. However, According to the investigators, the bank executive and officials colluded with the DSK Group "with dishonest and fraudulent intentions to sanction and disburse the amount of the bank (BoM)" under the garb of loans and the money was later siphoned off.
Besides Marathe, those arrested include Sushil Muhnoot, the bank’s former chairman and MD; Rajendra Gupta, executive director, and Nityanand Deshpande, the bank’s zonal manager, who was taken into custody from Ahmedabad. Also arrested were Sunil Ghatpande, DSKDL’s chartered accountant, and Rajiv Newaskar, chief engineer of the company.
All India Bank of Maharashtra Employees Association and BoM Officers Association, both affiliated with All India Bank Employees Association (AIBEA), felt the police have been overzealous while arresting top executives of BoM. In a statement, they say, "As a union, we are for accountability of the top management including MD and Executive Directors, but here in this case, investigative agencies have overstepped looking to the way in which they (the top executives) were taken into possession and ultimately kept in custody. This has happened a day early to the annual general body meeting of Bank's shareholders. This coincidence is inexplicable."
All India Bank Officers' Confederation (AIBOC) also condemned arrest of senior management. In a statement, DT Franco, General Secretary of AIBOC says, "It is known that most of the loans which have become non-performing assets (NPAs) are large advances, sanctioned at board level of the Banks consisting of representatives from Reserve Bank of India (RBI) and members nominated by Government as well. Hence, it is not in order to punish the bank officials alone if at all the government thinks of such an action."
As per the statement issued by BoM, its exposure in the consortium lending to DS Kulkarni Developers Ltd (DSKDL) is only Rs94.50 core as against sanctioned amount of Rs139 crore. The Consortium is led by State Bank of India (SBI) with 33.33% of the lending, followed by Union Bank of India (UBI), Syndicate Bank and BoM, each with Rs100 crore or 16.67%, IDBI Bank Ltd with Rs75 crore or 12.50% and Vijaya Bank with Rs25 crore or 1.46% stake in the lending of Rs600 crore.
Bank of Maharashtra said its exposure to DSKDL is Rs94.52 crore and is fully secured by primary and collateral securities. It says, "Recovery process like action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act has already been initiated by the Bank and some the properties are due for auction. Bank has also declared DSKDL and its promoters as wilful defaulters."
Pune-based DSK Group's owners DS Kulkarni and his wife Hemanti were arrested in February on charges of cheating over 4,000 investors of over Rs1,150 crore and diverting bank loans of nearly Rs2,900 crore.