CBI books Mandhana Industries for defrauding BoB, others of Rs 975 cr

New Delhi: The Central Bureau of Investigation (CBI) has registered a Rs 975-crore bank fraud case against Mumbai-based Mandhana Industries (now GB Global Limited) and its promoters. The case has been filed for allegedly defrauding a consortium led by Bank of Baroda (BoB) of Rs 975.08 crore.

CBI registered fraud case based on complaint from BoB

Former Managing Director, Purushottam Chhaganlal Mandhana, former Executive Director Manish Biharilal Mandhana, and a few others have been named by the CBI in the case. The case was registered on the basis of a complaint received from the bank in which it alleged that the directors of the company defrauded the consortium in a well-knit criminal conspiracy to funnel funds.

The audit also indicated fraudulent transactions and dealings with related parties, showing circular trading and diversion of funds.

Mandhana Industries was declared NPA by BoB in 2016

The 39-year-old company controlled by the Mandhana family started availing credit facilities from the Bank of Baroda in 2008, but the account was declared a non-performing asset on December 31, 2016.

A forensic audit was ordered by the bank, which exposed a number of irregularities, including diversion of funds to settle inter-corporate debts, not using a Trust and Retention Account (TRA) to route Rs 420.39 crore during July 2016 to September 30, 2017.

Mandhana Industries Limited is a vertically integrated, multi-dimensional textile and garment manufacturing company spread over multiple locations and has presence across operations from yarn dyeing to garment manufacturing.

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