WEB DESK
The anti-fraud agency (SFIO) of the Ministry of Corporate Affairs on Tuesday summoned ICICI Bank chief Chanda Kochhar and Axis Bank’s managing director Shikha Sharma in the Punjab National Bank (PNB) fraud case.
BSE has also sought clarification from both Axis Bank and ICICI Bank on the news report. ICICI Bank led the 31-bank consortium that extended credit to the tune of Rs 5,280 crore to Mehul Choksi’s Gitanjali Group. ICICI Bank alone had given Rs 405 crore loan to Gitanjali Gems.
According to media reports, top bank executives are only being questioned for clarifications and not as accused in the loan fraud case. Meanwhile, the ICICI Bank has said its exposure to the Gitanjali Group is not the largest among the consortium lenders.
The CBI had earlier questioned ICICI Bank Executive Director NS Kanan as part of the investigation in India’s biggest banking fraud. The SFIO’s Mumbai head has
confirmed to India Today that both Kocchar and Sharma have been summoned. “They have been summoned for giving the loan facility to Gitanjali Group. Our intention is to get the information from these two banks. We would like to question both of them.”
ICICI Bank had earlier claimed it did not have any exposure to Nirav Modi group of companies but the bank was only lending working capital to the group along with several other banks.
“We have no exposure to the Nirav Modi group of companies. We have not issued any Letter of Undertaking (LOU) nor do we have any buyer’s credit exposure against LOUs with respect to the Nirav Modi group of companies as well as the Gitanjali group of companies…We are working capital lenders to the Gitanjali group of companies along with several other banks in the consortium…Our exposure to the Gitanjali group of companies is not the largest among lenders in the consortium,” the bank had said, adding that it was “fully co-operating with the investigating agencies in their efforts”.
Earlier, a senior official of the ICICI Bank was summoned to the CBI office in Mumbai. NS Kannan, executive director ICICI bank, was the leader of consortium of the bank that lent money to Gitanjali Group, it has been alleged.
This comes amid reports that the Central Bureau of Investigation (CBI) on Monday detained Vipul Chitalia, vice president (banking operations), Gitanjali Group, at Mumbai airport in the Punjab National Bank fraud case. He has been taken for questioning at the Bandra-Kurla Complex, an official said. He did not divulge any other details about Chitalia’s alleged role in the PNB fraud.
The Rs 12,636-crore fraud was allegedly perpetrated by billionaire jeweller Nirav Modi and his uncle Mehul Choksi, the promoter of Gitanjali Gems.
It is alleged that Choksi and Modi got Letters of Undertakings (LoUs) and Foreign Letters of Credit (FLCs) of Rs 12,636 crore issued in favour of foreign branches of Indian banks based on fraudulent claims.
The accused officials of PNB did not enter the instructions for these LoUs and in their internal software to avoid scrutiny.